Content Provider | Supreme Court of India |
---|---|
e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | 2013 Companies Act |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case(s) Referred | Referred Case 0 |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Companies Act, 2013: ss. 212 & 219 – Power to Investigate– Affairs of Company – Body Corporate – Writ petitions filed before High Court challenging the legality of the orders dated 31 October 2018 and 27 October 2020 of the Union Ministry of Corporate Affairs, authorising an investigation under provisions of ss. 212 and 219 in respect of several corporate entities of the Sahara group – High Court, by its interim order stayed the operation, implementation and execution of the investigation orders on the grounds that directions issued for investigation by order dated 31 October 2018 was after the expiry of the stipulated time as per s. 212(3); and order dated 27 October, 2020 authorising investigation into six other companies was prima facie contrary to s. 219, as the six companies were neither subsidiaries nor holding companies of the companies which were to be investigated; and thirdly, orders did not furnish the reasons or circumstances which compelled the Central Government to form opinion – Aggrieved, Union government filed instant appeal – Issue limited to whether the High Court was justified in passing an interim direction staying the operation of the two orders – Held: High Court does have the power to pass wide-ranging directions in the exercise of its extraordinary jurisdiction – Companies Act 2013 does not contain any specific prescription of time and the reference to the completion of the investigation within a stipulated period is directory and not mandatory – Order of the Union Government dated 27 October 2020 contained factual averments which related to the invocation of the jurisdiction clause (c) of s. 219, which allows an investigation into the affairs of any other body corporate whose Board of Directors comprises nominees of a company or is accustomed to act in accordance with the directions or instructions of the company or any of its directors – On the basis of material placed on record, it cannot be said that the Union Government had not indicated reasons for the exercise of its jurisdiction under s. 212 and s. 219 – At this stage, the Union Government was only ordering an investigation and it would be inappropriate to place a burden of recording elaborate reasons when the purpose of the investigation is to ensure that a full enquiry into the affairs of the companies is carried out – High Court was not justified in staying the investigation and in passing the consequential directions which have been passed in the impugned orders at the interlocutory stage – Interlocutory order. |
Judge | Hon'ble Dr. Justice D.Y. Chandrachud |
Neutral Citation | 2022 INSC 627 |
Petitioner | Serious Fraud Investigation Office And Others |
Respondent | Sahara Housing Investment Corporation Limited And Others |
SCR | [2022] 16 S.C.R. 1060 |
Judgement Date | 2022-05-26 |
Case Number | 4299 |
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