When the foundation goes, the edifice falls

2005 SCC 477
Competent authority v. Barangore Jute Factory

Also see Hamid Khan 2008 8 SCC 730

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Judgement of coordinate bench is also binding

Siddharam Satlingappa Mhetre v. State of Maharashtra and Ors. MANU/SC/1021/2010 : AIR 2011 SC 312 : (2011) 1 SCC 694, while addressing the issue of per incuriam, a two-Judge Bench, speaking through one of us (Bhandari, J.), after referring to the dictum in Bristol Aeroplane Company Ltd. (supra) and certain passages from Halsbury's Laws of England and Raghubir Singh (supra), has stated thus:

149. The analysis of English and Indian Law clearly leads to the irresistible conclusion that not only the judgment of a larger strength is binding on a judgment of smaller strength but the judgment of a co-equal strength is also binding on a Bench of Judges of co-equal strength. In the instant case, judgments mentioned in paragraphs 135 and 136 are by two or three judges of this Court. These judgments have clearly ignored a Constitution Bench judgment of this Court in Sibbia's case (supra) which has comprehensively dealt with all the facets of anticipatory bail enumerated under Section 438 of Code of Criminal Procedure Consequently, judgments mentioned in paragraphs 135 and 136 of this judgment are per incuriam.

When law requires certain thing to be done in a certain way it must be done in that way and in no other

By catena of judgments, Hon'ble Supreme Court and this Court settled that a thing should be done in the manner provided by the Act and statutes and not otherwise, vide Taylor v. Taylor (1876) 1 Ch. D. 426; Nazir Ahmed v. King EmperorMANU/PR/0020/1936 : AIR 1936 PC 253; Deep Chand v. State of Rajasthan MANU/SC/0118/1961 : AIR 1961 SC 1527; Patna Improvement Trust v. Smt. Lakshmi Devi and Ors. MANU/SC/0389/1962 : AIR 1963 SC 1077; State of Uttar Pradesh v. Singhara Singh and Ors. MANU/SC/0082/1963 : AIR 1964 SC 358; Nika Ram v. State of Himachal PradeshMANU/SC/0193/1972 : AIR 1972 SC 2077; Ramchandra Keshav Adke v. Govind Joti Chavare and Ors. MANU/SC/0511/1975: AIR 1975 SC 915; Chettiam Veettil Ammad and Anr. v. Taluk Land Board and Ors. MANU/SC/0405/1979 : AIR 1979 SC 1573; State of Bihar and Ors. v. J.A.C. Saldanna and Ors. MANU/SC/0253/1979 : AIR 1980 SC 326, A.K. Roy and Anr. v. State of Punjab and Ors. MANU/SC/0156/1986 : AIR 1986 SC 2160; State of Mizoram v. Biakchhawna MANU/SC/0522/1995 : (1995) 1 SCC 156; J.N. Ganatra v. Morvi Municipality Morvi MANU/SC/0635/1996 : AIR 1996 SC 2520; Babu Verghese and Ors. v. Bar Council of Kerala and Ors. MANU/SC/0168/1999 : AIR 1999 SC 1281; and Chandra Kishore Jha v. Mahavir Prasad (1998) 8 SCC 266.

Guarantee - liability of directors

below is a short summary of the cases sent and mentioned.

 

PC Agarwala (2005) 8 SCC 104

 

This does not help. Here certain directors were sought to be made liable under the Payment of Wages Act by holding them personally responsible for the affairs of the company. The SC held that such an approach was permissible only if the statute allowed the same, and as the payment of wages act did not provide for it, directors of a company could not be made personally liable.

 

Meeking Transmission WP Tax No. 749/2003 dated 14.2.2008

 

This also does not help. This is case on piercing the corporate veil, and the circumstances when the same is permissible.

If we are going to argue that corporate veil should be pierced then the law laid down here may be relevant (see para 70)

 

1997 AWC 645 Adesh Kumar Jain and others Vs. U.P. S.E.B. and others, 1998 All.C.J. 266 (referred in Hamirpu Awas case)

 

the Court while rejecting a similar contention that the Director of the company would be personally liable for dues of the company held that though it is true that the Director of a company may be an agent of the company but that would not result in making the assets of the company to be the assets of the Director and vice versa. It further held that in the absence of any statutory provisions, recovery from the personal assets of the Director cannot be made Not relevant

 

Shri Kundanmal Dabriwala MANU/PH/3320/2011

The case deals with the question whether a debt which has been satisfied/extinguished between the borrower and the lender can be enfroced against the guarantor for the remainer. Here pursuant to a court order, Haryana State financial corporation had extinguished its claim and therefore subsequently was not allowed to claim from the guarantor. Not relevant

IFCI v. The Cannanore Spinning,  AIR 2002 SC 1841

 - see last 4 lines of para 36 (on discharge of guarantor)

"Significantly, it may be stated that the liability of the guarantor cannot but be stated to the a strict liability and even if the principal debtor is discharged from his liability unless such discharge is through the act of the creditor without consent of the surety/guarantor, the creditor' right of action against the surety is preserved."

 

Kailash Nath Agarwal v. PICUP, AIR2003SC1886

 

The question before the court was whether a recovery action can be taken against guarantors in view of Section 22 of the SICA that bar proceedings against the company which is under BIFR. There is nothing on the liability of directors or them as guarantors.

 

 

Second writ not maintainable on the same cause of action

Surya Deo Mishra (Full Bench) 2006 5 AWC5306, (2006)IILLJ583All, (2006)1UPLBEC399

 

Awadh Narain Pandey 2006 1 UPLBEC 1006 (DP Singh J)

 

Somaru Prasad 2004 3 AWC 2624

 

Satish Chandra Rastogi, 2011 5 AWC 4955

 

Ram Nevaj 2011 114 RD 205

Contractual appointment

Director, IMD, UP v. Pushpa Srivastava, AIR 1992 SC 2070 - appointment made for a fixed term comes to an end by efflux of time after expiry of the period of appointment. There is no question of termination of service after expiry of the aforesaid period since the incumbent has no right to continue in the absence of an order of appointment after such period.

See 2012 2 ADJ 115
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Consequential order alone challenged without challenging the original order - writ not maintainable

2011 (29) LCD 610

Paritosh Singh v. State of UP

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