A Division Bench of the Madras High Court has imposed an exemplary cost of Rs. 1 lakh on a minor shareholder of the Tamil Nadu Mercantile Bank (TMB) for moving a sub-court without any cause..
The issue pertains to the boardroom battle of the 94-year-old private bank in which a transfer of 95,418 shares led to several litigations before various courts, starting from lower courts to the Supreme Court.
Recently, when the decks were cleared for the conduct of annual general body meeting and the elections to the board, R.V.D. Ramaiah, who holds two shares of the bank, moved a suit before a sub-court in Vellore, which on January 25 passed interim orders affecting the conduct of the meeting and elections to the board.
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Assailing the order of the sub-court, Sub Continental Equities Limited, a Mauritius-based company and shareholder of TMB, approached the High Court alleging that the suit is an abuse of process of law and is over reaching the common order passed by the High Court on November 26, 2015.
Allowing the plea , a Division Bench of Justice V. Ramasubramanian (since transferred to Telangana and Andhra Pradesh High Court) and Justice N Kirubakaran said, “The manner in which the issue has been dealt with, for the past two decades, would demonstrate as to how the proceedings have been prolonged at various stages. It is needless to state that a party approaching the court and also who aids the party, are, by design, multiplying the proceedings to see that the other party is harassed and the dispute is not resolved to achieve their selfish ends. That is how the entire justice delivery system is being hijacked and affected.”
When a party tries to abuse justice delivery system, the courts should have to deal with iron hands , the Bench said and imposed Rs. 1 lakh as cost on Mr. Ramaiah.
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The Bench then held that the suit itself was not maintainable for lack of jurisdiction and struck down the order.
The cost must be paid to the Tamil Nadu State Legal Services Authority, Chennai, within two weeks. If he fails, the Vellore Tahsildar shall recover the amount from Mr. Ramaiah within four weeks thereafter and remit the amount, the Judges said.
The Bench also observed that the lawyers are officers of the court and they should analyse the facts and documents properly and file the case so that truth can be found out by the courts.
“Courts should have to deal with iron hands when judicial system
is abused”