1612 A

THE SUPREME COURT OF EBONY

15TH AMITY NATIONAL MOOT COURT COMPETITION, 2016

CIVIL APPEAL NO. ____ /2015

(Under Article 136 of the Constitution of India, 1950; read with Order XXI, Rule 1, Supreme
Court Rules, 2013)

KING DUMAS………………………………………………………………………….………APPELLANT 1

KING DRAGO…………………………………………………………………………………APPELLANT 2

KING DRAKSHIN…………………… ……………………………………………………...APPELLANT 3

v.

PRINCE WILD BILZERIAN………………………………...………………………….RESPONDENT

1

PRINCESS NORTH BILZERIAN………………………………………………………..RESPONDENT

2

i
MEMORIAL FOR THE APPELLANTS

ii
 TABLE OF CONTENTS

Table of Authorities......................................................................................................................iv

Statement of Jurisdiction...........................................................................................................viii

Statement of Facts........................................................................................................................ix

Issues Involved............................................................................................................................xiii

Summary of Arguments.............................................................................................................xiv

Body of Arguments........................................................................................................................1
[I.] The High Court has exceeded its jurisdiction under Section 10F while hearing an
appeal against Section 111.........................................................................................................1
[A.] The High Court has jurisdiction to decide a question of law............................................1
[B.] However, such jurisdiction is limited only to the questions of law arising out of the
order..........................................................................................................................................2
[C.]The refusal of the Company to transfer the share is arbitrary............................................3
[D.] The High Court has exceeded its jurisdiction in the present case....................................4
[II.] High Court could not have decided the dispute because § 10 of CPC applies..............6
[A.] The previously instituted suits are still pending...............................................................6
[B.] The matter in issue in the present suit and the pending suits is directly and substantially
the same....................................................................................................................................8
[C.] Parties to the suits are the same........................................................................................9
[D.] All these suits have been filed before courts of competence............................................9
[III.] The High Court could not have interpreted the will of King Ray under Section 10F.
....................................................................................................................................................10
[A.] Interpretation of will is not a question of law.................................................................10
[B.] Even if it is a question of law, it does not arise out of the order of Company Law Board.
................................................................................................................................................11
[C.] The power of the Court under Section 111 is summary and limited..............................11

iii
 [IV.] The Succession Certificate, By Virtue Of Queen Kim’s Death, Became Inoperative
And Could Not Be Relied Upon..............................................................................................16
[A.] The authority vested in joint-holders can only be exercised jointly...............................16
[B.] Section 383 allows for revocation of certificate upon death of a joint-holder................18
[V.] Probate proceedings instituted by Queen Kim cannot be said to lapse on the basis of
the Settlement deed..................................................................................................................19
[A.] Probate proceedings result in a judgment in rem and cannot lapse because of a private
agreement...............................................................................................................................19
[B.] The order granting succession certificate based upon the Settlement Deed does not
operate as res judicata upon the probate proceedings............................................................21
[VI.] The High Court has erred in directing the Company to transfer the shares in favour
of the respondents....................................................................................................................22

Prayer............................................................................................................................................24

iv
 TABLE OF AUTHORITIES
CASES

1. Ammonia Supplies Corporation (P.) Ltd. v. Modern Plastic Containers Pvt. Ltd., (1998) 7
SCC 105.
2. Aspi Jal and Anr. v. Khushroo Rustom Dadyburjor, AIR 2013 SC 1712.
3. Bajaj Auto Ltd. v. N.K. Firodia, (1971) 41 Comp Cas 1.
4. Bal Gangadhar Tilak v. Sahwarbau, 1926 Bom. 792.
5. Balbhadra v. Board of Revenue, 1981 AWC 525.
6. Bhura v. Kashi Ram, (1994) 2 SCC 111.
7. Bipin K. Jain v. Savik Vijay Engg P Ltd. (1998) 91 Comp Cas 835.
8. Bishunath Rai v. Sarju Rai, AIR 1931 All 745.
9. Boiron v. SBL Pvt. Ltd., 1999 (48) DRJ 31.
10. Commisioner of Income Tax v. Scindia Steam Navigation Co. Ltd., AIR 1961 SC 1633.
11. Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan and Ors., (2004) 122 CompCas 161
(SC).
12. Dayagen Pvt. Ltd. v.
13. .

STATUTES

1. Code of Civil Procedure, 1908.

2. Hindu Adoptions and Maintenance Act, 1956.
3. Hindu Succession Act, 1956.
4. Sale of Goods Act, 1930.
5. The Companies Act, 1956.
6. The Indian Succession Act, 1925.

BOOKS

1. A.RAMAIYA, GUIDE TO THE COMPANIES ACT (17th edn., 2011).

2. GOPALAKRISHNAN, LAW OF WILLS (7th edn., 2009).
3. LEXIS-NEXIS: THE COMPANY LAW MANUAL, 1927-2012 (2012).
4. MAYNE, HINDU LAW AND USAGE (16th edn., 2012).

v
 5. MULLA, THE CODE OF CIVIL PROCEDURE (15th edn., 2012).
6. N.D. BASU, LAW OF SUCCESSION (10th edn., 2009).
7. P.L. PARUCK, THE INDIAN SUCCESSION ACT (10th edn., 2011).
8. S.C. SARKAR, THE LAW OF CIVIL PROCEDURE (11th edn., 2006).
9. PARAS DIWAN, INDIAN PERSONAL LAWS-2: LAW OF ADOPTION, MINORITY,
GUARDIANSHIP AND CUSTODY (5TH edn., 2012).
10. PARAS DIWAN, MODERN HINDU LAW (20TH edn., 2009).

MISCELLANEOUS

1. BRYAN A. GARNER, BLACK’S LAW DICTIONARY (10th edn., 2014).

vi
 STATEMENT OF JURISDICTION

CIVIL APPEAL NO. _____ / 2015

The Appellant has approached this Honourable Court under Article 136 of the Constitution of
India, 1950. Subsequently, the leave has been granted by the Court.

vii
 STATEMENT OF FACTS
The Betrothals
The Democratic Republic of Ebony is a fully democratic State with twenty different provinces.
One of the provinces of Republic was Scion headed by King Igusthus. He had three daughters,
the eldest being Princess Khloe, followed by Princess Kourtney and then Princess Kim. All three
sisters were married one after another to King Big Bilzerian, head of the royal family of the
province of Thelesalonica. Consequently, they had four children. From Queen Khloe were born
Prince Dumas and Princess Dumagoli. From Queen Kourtney were born Prince Drago and
Prince Drakshin. Marriage with Queen Kim resulted in the birth of Prince Ray. Prince Ray was
given up on adoption to King Dueta of the royal family of Thalai who was issueless himself.
Princess Dumagoli was married into the Royal Family of Dakshin and gave birth to Princess
Duma. Prince Ray married Princess Carlen of the Province of Malay, who gave birth to Prince
Wild Bilzerian and Princess North Bilzerian.

The Formation of the Company

After the demise of King Big Bilzerian, the management and administration of the estate of the
Royal Family of Thelesalonica came under the control of King Dumas, King Drago and King
Drakshin. In the year 1981, all the brothers decided to bring up a business by establishing a
Company to which their former residence would be leased and would be converted into a
Heritage Hotel wherein the general public would be allowed to visit the Royal Fort and stay as
their guest. Thus, the family property was leased to the Company which was named “Royal
Retreat Group of Hotels Resorts and Palaces Pvt. Ltd.”

In 1983, the brothers, on the request of Queen Kim, added another promoter by amending the
Articles of Association of the company. This new promoter was King Ray. The amended
Articles of Association stated that in the event of death or legal disability of a promoter, the
shares of this promoter director shall be transferred to the company in the interim and eventually
transferred to the legal representatives of such promoter director. In the year 1986, a Partition
Suit was filed amongst the family members of the Royal Family of Thelesalonica seeking a
partition by metes and bounds. During the course of the Suit, the validity of the adoption of
Prince Ray and his right of inheritance also came under dispute.
viii
 Will and Succession Disputes
Amidst all this, owing to serious differences arising between King Ray and Queen Carlen, the
marriage ended in an irretrievable breakdown. In the year 1997, King Ray succumbed to ill-
health. After his death, Prince Wild Bilzerian and Princess North Bilzerian filed a case for
succession before the District Court seeking one-third share in the estate of King Ray along with
Queen Kim. In the same year, King Dumas filed an Impleadment Application and objected to
the succession certificate.

In December 2005, Queen Kim found a Will dated June 23, 1996 wherein King Ray had stated
that upon his demise, since he did not want his former wife to grab the property, both his
children would be disinherited and all his property would go to his mother.

In the Month of May 2006, the company received a letter from Queen Kim requesting
transmission of all the shares standing in the name of late King Ray in her favour in view of the
Will dated June 23, 1996 and she further filed an Application for Probate before the District
Judge of Thelesalonica on the basis of the aforesaid Will. However, the Company decided that in
light of the dispute and the civil cases pending before the courts, any person requesting for the
transmission of shares would be required to produce the evidence by way of appropriate title
through a Probate, failing which the Company would not transfer the shares in dispute to any
individual. On May 8, 2009, the grandchildren of Queen Kim entered into a Settlement Deed
with her before the District Court with regards to the share in the property of King Ray, wherein
it was agreed that the assets would be divided equally in a one-third share amongst themselves.
They obtained a succession certificate for the same.

Queen Kim expired in late 2009. Upon her death, Prince Wild Bilzerian moved an Application
before all the Courts wherein a dispute was pending an Application for Substitution as her Legal
Heir along with his sister Princess North. Similar applications were filed by the rest of the
family.

Prince Wild and Princess North also claimed that Queen Kim vide her Will dated 10.05.2009 had
bequeathed all her properties in favour of her two grandchildren and to no one else. Thus, on the

ix
basis of the said Will a Probate Petition was filed before the District Court wherein all the other
members of the family raised objections, challenging the authenticity of the said Will.

In the interim, all the above parties wrote to the Company seeking transfer of the shares of the
late King Ray in their own name. The Company, pointing to the various disputes pending
between the parties herein again declined to transfer any shares unless conclusive proof or
evidence by way of a Probate from a Court of competent jurisdiction was brought before it.

Orders of the Court and Appeals thereof

The High Court of Thelesalonica gave an Interim Order that both the groups before the Court i.e.
her grandchildren as well as her step sons were her legal heirs. Aggrieved by the same both the
grandchildren filed a Review Petition.

The Company yet again refused to transfer the shares in favour of any party. As a result, the
parties, dividing themselves into two groups, one comprising of the step sons and the other
comprising of the grandchildren, moved Applications before the Company Law Board under
Section 111 of the Companies Act, 1956 praying for the transfer of shares in favour of the
respective Applicants. Subsequently, in the year 2011 a Civil Suit was filed against Prince Wild
and Princess North, being a Suit for Declaration and Permanent Injunction, praying for a
declaration that the alleged Will of the Late Queen Kim dated 10.05.2009 was forged and
fabricated.

The Company Law Board held that it cannot, while exercising summary jurisdiction, decide
complicated questions of fact and law which arise before it. The parties then approached the
Hon’ble High Court wherein the Court held that succession certificate was prima facie proof of
title of the Prince and Princess and accordingly ordered for transfer of the assets and shares of
late King Ray in their favor.

The Hon’ble High Court also interpreted the will of late King Ray to mean that the concern of
the testator was that his estranged wife should not grab his property through his children. The

x
court further held that there appeared to be no fraud or forgery of the will and thus a Petition
under Section 111 was very much maintainable.

Aggrieved by the above findings and Judgement and Order of the Hon’ble High Court of
Thelesalonica, the aggrieved group filed Special Leave Petitions before the Hon’ble Supreme
Court of Ebony where leave was granted.

xi
 ISSUES INVOLVED
I.

WHETHER THE HIGH COURT HAD RIGHTLY EXERCISED ITS JURISDICTION UNDER SECTION 10F
WHILE HEARING AN APPEAL AGAINST SECTION 111 OF THE COMPANIES ACT?

II.

WHETHER THE HIGH COURT COULD HAVE HEARD AND DECIDED VARIOUS ASPECTS AND
DISPUTES PENDING ADJUDICATION IN THE COURTS BELOW WHICH WERE IN THE NATURE OF CIVIL

DISPUTES?

III.

WHETHER THE HIGH COURT COULD HAVE INTERPRETED A WILL WHILE EXERCISING
JURISDICTION UNDER SECTION 10F?

IV.

CAN A JOINT SUCCESSION CERTIFICATE BE RELIED UPON WHEREIN ONE OF THE MEMBERS TO THE
VERY SAME CERTIFICATE HAD EXPIRED?

V.

CAN PROBATE PROCEEDINGS BE TERMED AS LAPSED ON THE BASIS OF SETTLEMENT ENTERED

INTO BETWEEN SOME OF THE PARTIES?

VI.

WHETHER THE HIGH COURT WAS RIGHT IN DIRECTING THE COMPANY TO TRANSFER THE
SHARES OF KING RAY IN FAVOUR OF THE RESPONDENTS?

xii
 SUMMARY OF ARGUMENTS
I. The High Court has exceeded its jurisdiction under Section 10F while hearing an appeal
against Section 111

It is submitted the High Court had not exercised the jurisdiction conferred on it under Section
10F rightly. Section 10F envisages an appeal to the High Court only on a question of law that
arises out of the order of the Company Law Board. In the present case, the Company Law Board
has exercised its discretionary powers given to it under Section 111 of the Act to reject a petition
as it is convinced that it involves complicated questions of fact and law. However, such exercise
of discretion is appealable to the High Court as the non-maintainability itself is a question of law.

The appeal to the High Court has been made on this very issue. Moreover, since the Company
Law Board has not recorded any findings with regards to the facts or merits of the case, no other
questions arise out of its order. Therefore, the High Court has exceeded its jurisdiction while
deciding the appeal. Furthermore, the correct course of action in such a situation is to remand the
matter back to the Company Law Board after deciding the issue of maintainability positively.

II. The High Court could not have heard and decided various aspects and disputes pending
adjudication in the courts below which were in the nature of civil disputes

Section 10 of the Civil Procedure Code, 1908 says that a court shall not proceed with the trial of
a suit to which the Code applies when all of the following conditions are fulfilled: one, there is a
previously instituted suit which is still pending adjudication; two, the matter in issue in the
subsequent suit is directly and substantially the same as in the previously instituted suit; three,
both suits are either between the same parties or their privies; and four, the courts before which
suits have been filed are of competent jurisdiction.
First, there are three previously instituted suits, which are still pending and relevant for this case,
namely, probate for King Ray’s Will along with the Application for Substitution as Legal Heir,
probate for Queen Kim’s Will and Review Petition in High Court (2010). Secondly, there is
similarity of subject matter between the pending suits and the subsequent suits because the test of
res judicata is applicable. Thirdly, both in the previously pending suits and the present suit,
Princess North Bilzerian and Prince Wild Bilzerian are parties on one side and the stepsons of

xiii
Queen Kim are parties on the other side. Lastly, the courts before which suits have been filed are
courts of competence by virtue of Section 264 of the Indian Succession Act, 1925.

III. The High Court could not have interpreted the will of King Ray under Section 10F.

It is submitted that the High Court could not have interpreted a will while exercising its
jurisdiction under Section 10F. The jurisdiction under Section 10F is limited to questions of law
only. Moreover, it is limited to only those questions of law that arise out of the order of the
Company Law Board. A will is not a question of law. Since the interpretation of a will is done
through inferences drawn from the facts present, it is a question of fact and not law. Neither has
the question of interpretation of this will arisen out of the order of the Company Law Board as it
was never raised or dealt with by it. Therefore, the High Court could not have interpreted the will
of King Ray. Furthermore, the jurisdiction under Section 111 being summary in nature,
interpretation of will which requires investigation into facts, cannot be undertaken by the High
Court.

Even if the interpretation of will could have been done, the High Court has erred in the
interpretation of will of King Ray. The intent of the testator was to disinherit is children since
their actions, whatever may be the cause, had ultimately led the King to dislike them. Moreover,
the words in the will being clear and unambiguous, do not need the supply of intent that has been
given to it by the High Court.

IV. The Succession Certificate, by virtue of Queen Kim’s death, became inoperative and
could not be relied upon.

A succession certificate does not confer any title upon the grantee as an heir to the deceased. Its
purpose is limited to facilitation of collection of debts. In a grant of a joint succession certificate,
the authority vested in the multiple holders of the certificate can only be exercised jointly. The
certificate loses validity upon the death of one of the joint-holders, as illustrated in the case of
Sukumar Deb Roy v. Parbati Bala. Further, Section 383(d) of the Indian Succession Act
provides for revocation of certificate when it becomes “useless and inoperative through
circumstances” which would include the event of death of a joint-holder. Thus, the death of a
holder necessitates revocation and a new certificate must be applied for. Therefore, by virtue of

xiv
Queen Kim’s death the succession certificate inoperative and ceased to be in force. It could not
have been relied upon by the High Court.

V. Probate proceedings instituted by Queen Kim cannot be said to lapse on the basis of the
Settlement deed.

Probate proceedings cannot be said to lapse because of a private agreement between the parties.
First, the judgment produced through the course of a probate petition is a judgment in rem. The
issue for enquiry before a Probate Court is limited to the valid execution and genuineness of the
will. The fact of a settlement entered into by the consent of the parties is immaterial and falls
outside the scope of enquiry. Neither the provisions nor the prescribed form of probate under the
Indian Succession Act makes any allowance for a private compromise to affect the probate
proceedings. Withdrawal of the petition without the decision upon the grant of probate amounts
to improper withdrawal. Secondly, the order granting succession certificate based upon the
Settlement Deed does not operate as res judicata upon the probate proceedings. The grant of the
succession certificate does not bar the institution or continuance of a suit to determine the
heirship to debts and property of King Ray, like the probate petition. Therefore, the pendency of
the probate petition is not affected. The proceedings did not lapse and continue to be pending till
date.

VI. By virtue of being the legal heirs, the transfer of shares should be ordered in favour of
the appellants.

Queen Kim is the sole heir of King Ray by virtue of his Will. Moreover, the succession
certificate is inoperative, thus, divesting any interest that King Ray’s children could have had in
in his property. Also, the children of King Ray are not the heirs of Queen Kim due to the
presumption of validity of the adoption. Therefore, it is the appellants who are entitled to get the
shares transferred in their favour by virtue of being the legal heirs of Queen Kim.

xv
 BODY OF ARGUMENTS

[I.] THE HIGH COURT HAS EXCEEDED ITS JURISDICTION UNDER SECTION 10F WHILE
HEARING AN APPEAL AGAINST SECTION 111
1. An appeal was made against the order of the Company Law Board to exercise jurisdiction
in the matter before it stating that there were complicated questions of fact and law involved. The
decision of the High Court in favour of the children of King Ray was rendered in an appeal made
to the Court under Section 10F of the Companies Act, 1956.
2. It is submitted that the High Court has jurisdiction to decide a question of law [A.].
However, such jurisdiction is limited only to the questions of law arising out of the order of the
Company Law Board [B.]; The High Court has exceeded its jurisdiction in the present case [C.].

[A.] The High Court has jurisdiction to decide a question of law

3. An appeal to the High Court under Section 10F lies on a question of law that arises out of
the order of the Company Law Board. 1 In the present case, there is a question of law that has
been appealed to the High Court.
4. Section 111 of the Companies Act, 1956 provides discretionary powers to the Company
Law Board.2 The Board, on examination of the facts may refuse to adjudicate upon certain
matters. However, such discretion to refuse relief by denying exercise of powers under the
aforesaid section cannot be exercised by the Board arbitrarily. 3 In the present case, the Board has
passed the order stating that it does not have jurisdiction since there are disputed questions of
title.4 The Company Law Board cannot refuse to exercise jurisdiction merely by stating that the

1
The Companies Act, No. 1 of 1956, §10F (1956) (“Appeals against the orders of the Company Law Board- Any
person aggrieved by any decision or order of the Company Law Board 2 [made before the commencement of the
Companies (Second Amendment) Act, 2002] may file an appeal to the High Court within sixty days from the date of
communication of the decision or order of the Company Law Board to him on any question of law arising out of
such order:
Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing
the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.”).
2
V.L. Pahade (Dr.) v. Vinay L. Deshpande, 1999 SCC OnLine AP 187; S. Bhagat Singh v. Piar Bus Service Ltd.,
[1960] 30 Comp Cas 300; Ammonia Supplies Corporation (P.) Ltd. v. Modern Plastic Containers Pvt. Ltd., (1998) 7
SCC 105.
3
Public Passenger Service Ltd. v. M.A Khadar, AIR 1966 SC 489; Indian Chemical Products Ltd. v. State of Orissa,
(1966) 36 Com. Cases 592 (SC).
4
Factsheet ¶ 24.

1
matter involves complicated questions of law and fact. 5 The Board has to examine whether the
complicated questions are in fact present, or prima facie appear to be.6 The mere presence of a
dispute regarding title of the shares does not always mean that the Company Law Board will not
have jurisdiction to deal with it. If that is the case then any dispute that is present would be
presented as a complicated question to oust the jurisdiction of the Company Law Board.7
5. The order of the Company Law Board holding that it does not have jurisdiction to decide
the present matter is an exercise of the discretion conferred upon it by Section 111. The question
whether the discretionary power of the Board is rightly exercised is, therefore, a question of law.

[B.] However, such jurisdiction is limited only to the questions of law arising out of the
order.
6. An appeal lies to the High Court only on a question of law arising out of the order of
CLB.8 The jurisdiction of the High Court under Section 10F is limited to the questions of law
that arise out of the order of the Company Law Board. A question of law arises out of the order
of the Board in three instances: first, the question has been raised before the board, and dealt
with by it; secondly, the question is raised before the board, but not dealt with by it in its order,
and; thirdly, the question is not raised before the tribunal, but is dealt with by it.9
7. In the present case, the only question of law that arises out of the order given by the
Company Law Board is the scope and exercise of the jurisdiction of the Company Law Board. 10
Therefore, the High Court has jurisdiction under Section 10F to decide whether the Company
Law Board was correct in holding that it does not have jurisdiction due to the presence of
complicated questions. The jurisdiction of the High Court, however, is limited to this question
only.11

5
Muniyamma v. Arathi Cine Enterprises (P) Ltd., (1993) Com. L.J 327; E.V Swaminathan v. KMMA Industries &
Roadways (P) Ltd., (1993) 1 Com. L.J 291 (Mad.); Kothari Industrial Corporation Ltd. v. Lazor
Detergents Pvt. Ltd., (1994) Com. Law 617.
6
Ammonia Supplies Corporation (P.) Ltd. v. Modern Plastic Containers Pvt. Ltd., (1998) 7 SCC 105; Boiron v. SBL
Pvt. Ltd., 1999 (48) DRJ 31.
7
Kothari Industrial Corpn. Ltd. v. Lazor Detergents Pvt. Ltd., 1994 Com. Law 617
8
The Companies Act, No. 1 of 1956, § 10F.
9
Commissioner of Income Tax v. Scindia Steam Navigation Co. Ltd., AIR 1961 SC 1633; Ammonia Supplies
Corporation (P.) Ltd. v. Modern Plastic Containers Pvt. Ltd., (1998) 7 SCC 105; Manoj Kumar Kanuga v. Marudhar
Power Pvt. Ltd., [(2013) 179 CompCas 504(AP); M/s Micromeritics Engineers Pvt. Ltd. v. S. Munusamy, (2002) 3
CTC 661.
10
Argued Above.
11
LEXIS-NEXIS: THE COMPANY LAW MANUAL 1927-2012, 145 (2012).

2
 [C.]The refusal of the Company to transfer the share is arbitrary.
8. It is submitted that the Company has refused the transfer of shares in the favour of the
step-sons of Queen Kim without reasonable justification for the same as: (i.) The power to refuse
is not present in the Articles of Association; (ii.) Even if it is present in the Articles of
Association, it has been exercised arbitrarily.

[i.] The power to refuse is not present in the Articles of Association.

9. A private company has power to restrict the transfer of shares in accordance with its
Articles of Association.12 In cases where the Articles of Association of the company confer
powers on the directors to refuse registration of the shares, the court has held that such a power
should be exercised reasonably.13 However, the directors have no inherent power to refuse the
transfer of shares or the registration thereof.14 Such a power has to flow from a source and is
exercisable only when it is either specified or traceable in the Articles of Association of the
Company.15
10. In the present case, Clause 11, which deals with the transfer of shares of a promoter
director in case of death or resignation, does not provide for any powers to the directors to refuse
the transfer of shares.16 Hence, the Company has exceeded the scope of the powers given to it
under the Articles of Association while refusing the transfer of the shares to the applicants.
Therefore, a petition under Section 111 was rightly maintainable before the Company Law
Board, where clearly, on the face of it, the Company has declined registration without any power
in this regard.17

[ii.] Even if it is present, it has been arbitrary.

11. Even if it is assumed that the Company did have the power to refuse the transfer, the
power has been exercised by it arbitrarily. The Company was not justified in insisting on a
Probate when the High Court has, through an Interim Order, declared the heirs of Queen Kim. 18

12
V.B. Rangaraj v. V.B. Gopalakrishnan, (1992) 73 Comp Cas 201.
13
Bajaj Auto Ltd. v. N.K. Firodia, (1971) 41 Comp Cas 1.
14
A. RAMAIYA, GUIDE TO THE COMPANIES ACT, 1580 (17th edn., 2011).
15
Luxmi Tea Co. Ltd. v. P.K. Sarkar, (1990) 67 Comp Cas 518; V.B. Rangaraj v. V. B. Gopalakrishnan, (1992) 73
Comp Cas 201.
16
Factsheet ¶ 12.
17
RAMAIYA, supra note 14, at 1581.
18
Factsheet ¶ 22.

3
When an order regarding the heirs has been given, and there is no stay granted by any Court, the
Company is not justified in refusing the transfer of shares despite of the Interim Order.19
12. Admittedly, the transfer on the basis of the Interim Order will divide the shares of King
Ray, willed in favour of Queen Kim, between both the parties. However, the fact that Company
has refused to give effect to the transfer even then, and has insisted on a probate which is not
required as the will of King Ray was never under challenge and the High Court has, in the
interim, ordered both the parties to be legal heirs, is an arbitrary restriction on the transfer of
shares.
13. Therefore, where the refusal to transfer the shares by the Company, and to register the
transfer, is arbitrary, a petition to the Company Law Board was maintainable. 20 There were no
complicated questions involved. However, the Board failed to see the arbitrary exercise of the
power of refusal by the Company. The Company Law Board did not take into account the
Interim Order of the High Court. The Company Law Board had the jurisdiction to decide the
issues and ought to have exercised the same.

[D.] The High Court has exceeded its jurisdiction in the present case
14. The matters that are presented before the High Court in an appeal under Section 10F
against an order of the Company Law Board is to be limited to the questions of law that have
been either raised before the Company Law Board or have been dealt with by it in its order.
15. In the present case, the Company Law Board concluded that it did not have jurisdiction to
decide the matter.21 Since, the order of the Company Law Board was limited to the non-
maintainability of petition due to the want of jurisdiction to decide complicated matters; the
question of law that arises out of the order is limited to this issue of non-maintainability. 22 The
arbitrary exercise of the power to refuse the transfer is not a question of law, but an analysis
based on the facts. The High Court did not have jurisdiction to venture beyond the issue of the
scope of jurisdiction of the Company Law Board and the correctness of the exercise of such
jurisdiction in the present case.
16. In case the High Court came to the conclusion that there were no complicated questions
of fact and law involved, the High Court is empowered to set aside the order of Company Law

19
RAMAIYA, supra note 14, at 1581.
20
Luxmi Tea Co. Ltd. v. P.K. Sarkar, (1990) 67 Comp Cas 518.
21
Factsheet ¶ 24.
22
K. Muthusamy v. S. Balasubramaniam, 2011 (2) TMI 1279.

4
Board.23 However, the jurisdiction of the High Court is limited to this order. The High Court
could not have examined the facts and rendered a decision on the matter itself. The High Court
does not have the power to decide the disputes regarding the facts. 24 In the present case, the High
Court has gone into the depth of the matter and has dealt with the facts of the case, recording its
own findings in the process.25 The High Court, instead of going into an analysis of the facts,
ought to have remanded the matter back to the Company Law Board and directed it to re-
examine the matter.26
17. Furthermore, the Company Law Board had not gone into the merits of the case and had
not recorded any finding of facts.27 The High Court can deal with the facts only when the finding
by the Company Law Board is perverse.28 In the instant case, the Company Law Board has
rejected the petition at the threshold of admission. Hence, it has not recorded any finding of fact
for it to be hit by perversity. Therefore, the High Court cannot decide based upon the facts of the
case.29 The High Court cannot embark upon consideration of evidence with reference to shares
and their title. It is outside the purview of its jurisdiction.30
18. In addition, the power of the High Court to hear an appeal under Section 10F is
analogous to the power of High Court under Section 100 of Civil Procedure Code. 31 Therefore, it
would also be subject to the same limitations. The High Court is not competent to deal with the
facts and record its findings. The correct course of action was for the court to relegate the matter
so that the Company Law Board could have exercised its power under Section 111 to determine
the disputed facts.32
19. It is therefore, submitted that the High Court had not exercised its power rightly while
deciding the appeal presented before it and has exceeded the jurisdiction conferred upon it by the
law. It did not have the jurisdiction to go beyond the questions of law that arose out of the order
of the Company Law Board.
23
Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan & Ors., (2004) 122 CompCas 161 (SC).
24
Nupur Mitra v. Basubani Pvt. Ltd., (1999) 35 CLA 97.
25
Factsheet ¶ 25.
26
Dayagen Pvt. Ltd. v. Rajendra Dorian Punj, (2009) 151 CompCas 92 (Del); K.S.Narayana Iyer v.Talayar Tea Co.
Ltd., (1995) 83 CompCas 743 (CLB).; RAMAIYA, supra note 14, at 1623.
27
Factsheet ¶ 24.
28
Sree Meenakshi Mills Co. Ltd. v. Commissioner of Income Tax, AIR 1957 SC 49; M/s Micromeritics Engineers
Pvt. Ltd. v. S. Munusamy, (2002) 3 CTC 661.
29
V.S. Krishnan v. Wertfort Hi-Tech Hospital Ltd., (2008) 83 CLA 371.
30
Mattulal v. Radhey Lal, AIR 1974 SC 1596.
31
Lohia Properties (P.) Ltd. v. Atmaram Kumar, (1993) 4 SCC 6.
32
Lohia Properties (P.) Ltd. v. Atmaram Kumar, (1993) 4 SCC 6; Nupur Mitra v. Basubani Pvt. Ltd., (1999) 35
CLA 97.

5
 [II.] HIGH COURT COULD NOT HAVE DECIDED THE DISPUTE BECAUSE § 10 OF CPC APPLIES.
20. It is submitted that the High Court could not have heard and decided various aspects and
disputes pending adjudication in the courts below because bar on trial of suit as given in Section
1033 of Civil Procedure Code, 1908 applies. All the four elements of Section 1034 are fulfilled-
first, the previously instituted suits are still pending [A.]; secondly, the matter in issue in the
present suit and the pending suits is directly and substantially the same [B.]; thirdly, parties to the
suits are the same[C.]; and fourthly, the suits have been filed before courts of competence [D.].

[A.] The previously instituted suits are still pending.

21. The previously instituted suits include Partition Suit of 1986,35 Succession Case No. 413
of 1998,36 Probate Petition No. 72 of 200637 (for King Ray’s Will), Applications for Substitution
as Legal Heirs of Queen Kim (2009),38 Probate Petition No. 3983 of 2010 39 (for Queen Kim’s
Will), Review Petition No. 76347 of 2010 40 and Civil Suit for Declaration and Permanent
Injunction (2011)41. Except the Succession Case of 1998, all other above mentioned suits are
pending in nature.
22. The Succession Case No. 413 of 199842 can be said to have been concluded on the
issuance of the Succession Certificate by the District Court of Thelesalonica to Princess North
Bilzerian, Prince Wild Bilzerian and Queen Kim.43
23. Now five other suits are pending which include Probate Petition for Queen Kim’s Will in
the District Court, Partition Suit of 1986, Review Petition against the Interim Order of the High
Court and Civil Suit for Declaration and Permanent Injunction (2011) are also clearly pending

33
Code of Civil Procedure, Act No. 5 of 1908, § 10 (1908) (“Where a question arises as to whether any person is or
is not the legal representative of a deceased plaintiff or a deceased defendant, such question shall be determined by
the Court: Provided that where such question arises before an Appellate Court, that Court may, before determining
the question, direct any subordinate Court to try the question and to return the records together with evidence, if any,
recorded at such trial, its findings and reasons therefor, and the Appellate Court may take the same into
consideration in determining the question.”).
34
See also Swagath Marine Products Pvt. Ltd. v. K. Muthuswamy, (2006) 134 Comp Cas 182 (CLB) (elements of §
10 have been enlisted).
35
Factsheet ¶ 13.
36
Factsheet ¶ 15.
37
Factsheet ¶ 17.
38
Factsheet ¶ 19 (filed before all the courts wherein a dispute was pending).
39
Factsheet ¶ 20.
40
Factsheet ¶ 22.
41
Factsheet ¶ 23.
42
Factsheet ¶ 15.
43
Factsheet ¶ 18.

6
adjudication.44 The probate proceedings for King Ray’s Will continue to exist and do not lapse as
a result of the issuance of the succession certificate to Princess North and Prince Wild along with
Queen Kim because the judgment produced as a result of a probate petition is a judgment in rem
and the fact of a settlement entered into by the consent of the parties is immaterial and falls
outside the scope of enquiry. From amongst these, there are only three suits relevant for Section
10, viz., both the probate proceedings and the Review petition in the High Court.
24. Applications for Substitution as Legal Heirs of Queen Kim were filed in all those courts
wherein a dispute was pending adjudication. 45 At the time these applications were filed, the
pending suits included the Succession Case No. 413 of 1998, 46 Probate Petition for King Ray’s
Will47 and the Partition suit of 198648. Thus, the courts before which these Applications were
filed include the District Court of Thelesalonica and the High Court. Order 22, Rule 5 of the
Code of Civil Procedure, 190849 empowers the Court to decide questions as to who the legal
representatives of a deceased plaintiff or a deceased defendant are. 50 The objective of this
provision is the sustenance of suits to which the deceased was a party. Therefore, these
applications also lapse when the corresponding proceedings come to an end. As has been argued
above, only the Succession case has come to an end while the probate for King Ray’s Will and
Partition suit are still pending. Thus, Applications for Substitution as Legal Heirs now exist
corresponding to these two suits but of these only the one related to probate for King Ray’s Will
is relevant.
25. Therefore, the previously instituted suits, which are still pending and relevant for this
case are probate for King Ray’s Will along with the Application for Substitution as Legal Heir,
probate for Queen Kim’s Will and Review Petition in High Court (2010).
44
Factsheet ¶¶ 13, 20, 22, 23.
45
Factsheet ¶ 19.
46
Factsheet ¶ 15.
47
Factsheet ¶ 17.
48
Factsheet ¶ 13. See also factsheet ¶¶ 19,20 (Probate petition for Queen Kim’s Will was filed after the Applications
for Substitution as Legal Heirs were filed).
49
Code of Civil Procedure, Act No. 5 of 1908, Order 22, Rule 5 (1908) (“Where a question arises as to whether any
person is or is not the legal representative of a deceased plaintiff or a deceased defendant, such question shall be
determined by the Court: Provided that where such question arises before an Appellate Court, that Court may, before
determining the question, direct any subordinate Court to try the question and to return the records together with
evidence, if any, recorded at such trial, its findings and reasons therefor, and the Appellate Court may take the same
into consideration in determining the question.”)
50
Code of Civil Procedure, Act No. 5 of 1908, Order 22, Rule 5 (1908). Gurcharan Singh v. Surjit Singh & Anr.
[I.A. No. 2 to 6, in Special Leave Petition (C) No. 7735 of 2010, application decided on 2nd Nov. 2012];
Kurappaswamy & Ors. v. C. Ramamurthy, AIR 1993 SC 2324; Ram Kala v. Deputy Director (Consolidation) &
Ors., (1997) 7 SCC 498.

7
 [B.] The matter in issue in the present suit and the pending suits is directly and
substantially the same.
26. Subject matter refers to a “bundle of facts”51 that are required to be proved to “entitle the
plaintiff to the relief claimed by him”52. The issue in the current suit revolves around the dispute
between the parties regarding transfer of shares of King Ray. For these shares to be transferred,
the parties are required to show the existence of a proof entitling them to such transfer. 53 A
probate54 or a succession certificate55 can be considered to be sufficient proof for such transfer.
Therefore, proof of entitlement to shares and consequently, succession certificate obtained by
Princess North Bilzerian and Prince Wild Bilzerian along with Queen Kim, can be said to be the
subject-matter in this case. In other words, it is imperative as per the Articles of Association of
the Company to prove who the legal representatives of King Ray are.56
27. An important test to determine the applicability of Section 10 is the test of res judicata
according to which if the decision in the previous suit would act as res judicata57 on the
subsequent suit, then the latter is bound to be stayed. 58 The “matter in controversy” 59 should be
the same in both suits and not the relief claimed.60 Complete identity of prayers is not essential.
The subject matter should be directly and substantially the same to the extent of affecting the
decision in the subsequent case.61 Decisions in all the pending cases were bound to have an
impact on the decision of the High Court in the present case. Completion of trial in any of the
three pending cases would conclusively determine who the heirs of King Ray are and
consequently who is entitled to get the shares transferred. There could also have been a conflict
of decisions which goes against the object of Section 10 which is to avoid parallel adjudication
and prevent conflicting decisions.62
51
Vallabh Das v. Madan Lal, AIR 1970 SC 987.
52
Vallabh Das v. Madan Lal, AIR 1970 SC 987.
53
Factsheet ¶¶ 17, 21.
54
See factsheet ¶ 17 (Company itself asks for a Probate in its Annual General Meeting).
55
See generally Thenappa Chettiar v. Indian Overseas Bank Ltd., (1943) 13 Com Cases 202 (Mad).
56
Factsheet ¶ 12.
57
See generally BRYAN A. GARNER, BLACK’S LAW DICTIONARY, 1470 (10th edn., 2014) (“Rule that final judgment
or decree on merits by court of competent jurisdiction is conclusive of rights of parties or their privies in all later
suits on points and matters determined in former suit”).
58
National Institute of M.H. & N.S. v. C Parameshwara, AIR 2005 SC 242.
59
Aspi Jal and Anr. v. Khushroo Rustom Dadyburjor, AIR 2013 SC 1712.
60
Aspi Jal and Anr. v. Khushroo Rustom Dadyburjor, AIR 2013 SC 1712.
61
Swagath Marine Products Pvt. Ltd. v. K. Muthuswamy, (2006) 134 Comp Cas 182 (CLB).
62
National Institute of M H & NS v. C Parameshwara, AIR 2005 SC 242.

8
28. Therefore, there is similarity of subject matter between the pending suits and the
subsequent suits.

[C.] Parties to the suits are the same.

29. Parties to the suits are same. Both in the previously pending suits and the present suit,
Princess North Bilzerian and Prince Wild Bilzerian are parties on one side and the stepsons of
Queen Kim are parties on the other side, contesting under the same title in all these suits.63

[D.] All these suits have been filed before courts of competence.
30. The previous suits are before courts of competence. A court is said to be one of
competence when it has the power to grant a relief claimed in a particular suit. 64 A District Court
has the power to grant probate because of two main reasons. Firstly, it is the ‘District Court’
which is competent to grant probate according to Section 264 of Indian Succession Act, 1925. 65
Secondly, in order for such District Court to have territorial jurisdiction, the deceased should
either have place of abode or property (whether movable or immovable) within its jurisdiction. 66
Shares are movable property according to Section 82 of the Companies Act, 1956 and Section
2(7) of the Sale of Gods Act, 1930. 67 In this case, the property under consideration in the probate
proceedings includes the shares of King Ray in the Company registered in Thelesalonica. 68
Therefore, the District Court of Thelesalonica is a court of competence for the purposes of
Section 10.
31. In case of the Review Petition of 2010, the High Court has the power to declare who the
legal heirs of a deceased person are.69 Therefore, it is a court of competence.

63
Factsheet ¶¶ 15, 20, 22.
64
Nirmal Singh v. Om Prakash, AIR 1965 J&K 99; JT Republike v. Rungta & Sons, AIR 1966 Cal 382;
Somasundaram v. Venkata Subbayya, AIR 1938 Mad 602.
65
The Indian Succession Act, No. 39 of 1925, §264 (1925).
66
The Indian Succession Act, No. 39 of 1925, §270 (1925).
67
Companies Act, No. 1 of 1956, § 82 (1956); Sale of Goods Act, No. 3 of 1930, § 2(7). Smt. Kanta v. State 1985
SCC OnLine Del 160; N. S. Chopra v. State of Delhi, 2014 Indlaw DEL 1916.
68
Factsheet ¶ 9.
69
M/s Kalinga Mining Corporation v. Union of India, Civil Appeal No. 1013 of 2013; Shrimant v. Mrunalinidevi,
CR.MA/2062/2010; Suresh Kumar Bansal v. Krishna Bansal & Anr., Civil Appeal No. 8271 of 2009; Sequeria v. P.
Francisco, AIR 1976 Goa 48.

9
32. Moreover, it has also been held by the Supreme Court that even though Section 10 is a
rule of procedure, it is still a mandatory provision.70 As all the conditions of Section 10 stand
fulfilled, bar on trial of the present suit in High Court applies.
33. Therefore, the High Court erred in continuing with the trial of this case and should have,
instead, stayed the proceedings keeping in view the pendency of the previous civil suits.

[III.] THE HIGH COURT COULD NOT HAVE INTERPRETED THE WILL OF KING RAY UNDER
SECTION 10F.
34. The decision of the High Court in the appeal has been given in the favour of the children
of King Ray, directing the Company to transfer the shares in their favour and register the same.
The judgement also ventures on to decide the title to the property of King Ray through the
interpretation of his will in favour of Queen Kim.
35. It is submitted that the High court did not have jurisdiction under Section 10F to interpret
the will of King Ray as: first, interpretation of will is not a question of law [A.]; secondly, it is
not arising out of the order of Company Law Board [B.], and; thirdly, the power of the court
under Section 111 is summary and limited [C.]. Even if the will could have been interpreted, the
High Court erred in the interpretation [D.].

PRAYER
Wherefore in light of the issues raised, arguments advanced and authorities cited, it is humbly
prayed that this Honourable Court may be pleased to adjudge and declare that:

1. The High Court had incorrectly exercised its jurisdiction under Section 10F while hearing
an Appeal against Section 111 of The Companies Act.
2. The High Court could not have heard and decided various aspects and disputes pending
adjudication in the courts below which were in the nature of civil disputes.
3. The High Court could not have interpreted a will while exercising jurisdiction under
Section 10F.
4. The High Court could not have relied upon the joint succession certificate after one of the
members to the very same certificate had expired.

70
Manohar Lal Chopra v. Rai Bahadur Rao Raja Seth Hiralal, AIR 1962 SC 527.

10
 5. Probate proceedings cannot be said to have lapsed on the basis of settlement entered into
between some of the parties.
6. The High Court has erred in directing the transfer of shares of King Ray in favour of the
respondents.

And pass any other order that this Honourable Court may deem fit in the interests of justice,
equity, and good conscience.

All of which is humbly prayed,

1612 A,

Counsel for the Appellants.

11