IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE R.BASANT & THE HONOURABLE MR. JUSTICE K.SURENDRA MOHAN THURSDAY, THE 16TH JUNE 2011 / 26TH JYAISHTA 1933 WP(C).No. 9130 of 2011(M) ------------------------------------- PETITIONER: ------------------- SUBHASH SOMAN, MANAGING DIRECTOR, DIAMOND REAL ESTATE, PATHANAMTHITTA. BY SRI.N.DHARMADAN, SENIOR ADVOCATE, ADV. SMT.D.P.RENU. RESPONDENTS: ------------------------ 1. THE SUPERINTENDENT OF POLICE, O/O. THE SUPERINTENDENT OF POLICE, PATHANAMTHITTA – 689 645. 2. S.I. OF POLICE, KOYIPURAM POLICE STATION, KOYIPURAM, PATHANAMTHITTA – 689 645. 3. K.K.SREEDHARAN, S/O. KUMARAN, KALLARATHIL VEEDU, KUMARAMANGALAM, THODUPUZHA – 685 584. 4. K.N.ANANDAN, S/O. LATE NARAYANAN, ASWATHY BHAVAN, ATHIRUMKAL P.O., KOODAL (VIA.), PATHANAMTHITTA – 689 693. 5. SADANANDAN RAMAN, S/O. LATE M.M.VASUKUTTY, BY POWER OF ATTORNEY AGENT M.V.ANANDAN, S/O. LATE M.M.VASUKUTTY, MANNUTHARAYIL HOUSE, PUNNAKKADU P.O., KOZHENCHERRY, PATHANAMTHITTA – 689 654. W.P.(C). NO.9130/2011: 6. K.N.RADHAKRISHNAN, S/O. K.R.NANU, KOTTAMADATHIL HOUSE, ELAYUMTHITTA P.O., PATHANAMTHITTA. 7. M.V.ANANDAN, S/O. M.M.VASUKUTTY, MANNUTHARAYIL HOUSE, PUNNAKKADU P.O., KOZHENCHERRY, PATHANAMTHITTA. R1 & R2 BY GOVT. PLEADER SRI. T.K. VIPINDAS, R3 BY ADVS. SRI.K.S.HARIHARAPUTHRAN, SRI.GEORGE MATHEW, SRI.DIPU JAMES, R4 TO R7 BY ADV. SRI.V.PHILIP MATHEWS. THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 16/06/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C). NO.9130/2011-M: APPENDIX PETITIONERS' EXHIBITS: EXT.P.1: COPY OF THE ORDER DT. 16/10/2009 ISSUED BY COMPANY LAW BOARD. EXT.P.2: COPY OF THE LIST OF SHARE HOLDERS AS ON 30/09/2001. EXT.P.3: COPY OF THE COUNTER AFFIDAVIT FILED BY PETITIONER IN W.P.(C).3721/2011. EXT.P.4: COPY OF THE PETITION DT. 29/01/2011 BY PETITIONER BEFORE THE R.1. EXT.P.5: COPY OF THE COMPLAINT DT. 21/02/2011 BY PETITIONER BEFORE THE POLICE. EXT.P.6: COPY OF THE COMPLAINT DT. 09/03/2011 BY PETITIONER BEFORE THE POLICE. EXT.P.7: COPY OF THE COMPLAINT DT. 15/03/2011 FILED BY PETITIONER BEFORE THE POLICE. EXT.P.8: COPY OF THE CERTIFICATE DTD. 12/11/2009. EXT.P.9: COPY OF THE AFFIDAVIT DT. 15/12/10 FILED BEFORE THE COMPANY LAW BOARD. EXT.P.10: COPY OF THE LICENCE DT. 19/05/10 ISSUED BY THE PANCHAYAT. EXT.P.11: COPY OF THE CONSENT ISSUED BY POLLUTION CONTROL BOARD. EXT.P.12: COPY OF THE NEWS ITEM (ANNEXURE 14 IN COMPANY PETITION). EXT.P.13: COPY OF THE JUDGMENT IN W.P.(C).4305/2009 DT. 26/02/2009 OF THIS HON'BLE COURT. EXT.P.14: COPY OF THE SHOW CAUSE NOTICE DT. 18/04/2007 BY ADV. RENJI GEORGE CHERIAN. EXT.P.15: COPY OF THE JUDGMENT IN W.P.(C).NO.1583/2010 DT. 18/01/20190 OF THIS HON'BLE COURT. EXT.P.16: COPY OF THE APPEAL PETITION NO.140/2011 FILED BEFORE THE TRIBUNAL. EXT.P.17: COPY OF THE ORDER IN I.A. NO. 192/2011 IN APPEAL NO. 140/2011 DT. 24/02/2011 OF THE TRIBUNAL. EXT.P.18: COPY OF THE MINUTES OF MEETING HELD ON 02/05/2009. EXT.P.19: COPY OF THE FORM 32. EXT.P.20: COPY OF THE FORM 23. W.P.(C). NO.9130/2011-M: EXT.P.21: COPY OF THE RECEIPT DT. 19/03/2011. EXT.P.22: COPY OF THE PETITION DT. 18/04/2011. EXT.P.23: COPY OF THE MODEL REGISTER AND NOTICE. EXT.P.24: COPY OF THE COMPLAINT DT. 12/05/2011 BEFORE THE C.J.M. EXT.P.25: COPY OF THE JUDGMENT DTD. 12/08/2010 IN W.P.(C).NO.23122/2010 OF THIS HON'BLE COURT. EXT.P.26: COPY OF THE JUDGMENT DTD. 26/10/10 IN O.P.(C).NO.425/2010 OF THIS HON'BLE COURT. EXT.P.27: COPY OF THE JUDGMENT DTD. 26/02/2009 IN W.P.(C).NO.5742/2009 OF THIS HON'BLE COURT. EXT.P.28: COPY OF THE ORDER DTD. 27/05/2011 ISSUED BY PANCHAYAT. EXT.P.29: COPY OF THE ORDER DTD. 06/06/2011 IN W.P.(C).15171/2011 OF THIS HON'BLE COURT. EXT.P.30: COPY OF THE COMPLAINT FILED BY THE PETITIONER. RESPONDENTS' EXHIBITS: EXT.R4.A: COPY OF THE MEMORANDUM AND ARTICLES OF ASSOCIATION OF DIAMOND REAL ESTATE PVT. LTD. EXT.R4.B: COPY OF THE PLAINT IN O.S. 178/11. EXT.R4.C: COPY OF THE REPLY DTD. 01/01/2010 ISSUED BY THE SECRETARY OF THE PANCHAYAT. EXT.R4.D: COPY OF THE ORDER DTD. 10/03/2010 PASSED BY THE SECRETARY OF THOTTAPUZHASSERRY GRAMA PANCHAYAT. EXT.R4.E: COPY OF THE ORDER DTD. 10/12/2010 PASSED BY THE OMBUDSMAN FOR LOCAL SELF GOVERNMENT INSTITUTIONS, THIRUVANANTHAPURAM IN O.P. NO. 593/10. EXT.R4.F: COPY OF THE ORDER DTD. 23/12/2010 PASSED BY THE SECRETARY OF THOTTAPUZHASSERRY GRAMA PANCHAYAT. EXT.R4.G: COPY OF THE ORDER DTD. 07/01/2011 PASSED BY THE OMBUDSMAN FOR LOCAL SELF GOVERNMENT INSTITUTIONS, THIRUVANANTHAPURAM. EXT.R4.H: COPY OF THE LETTER DTD. 14/01/2011 ISSUED BY SECRETARY TO THE GOVERNMENT, LOCAL SELF GOVERNMENT DEPARTMENT. W.P.(C). NO.9130/2011-M: EXT.R4.I: COPY OF THE PETITION DTD. 13/09/2009 FILED BEFORE THE COMPANY LAW BOARD. EXT.R4.J: COPY OF THE REPORT FILED BY THE DEPUTY DIRECTOR OF PANCHAYATS BEFORE THE OMBUDSMAN FOR LOCAL SELF GOVERNMENT INSTITUTIONS. //TRUE COPY// P.S. TO JUDGE. Prv. R.BASANT & K.SURENDRA MOHAN, JJ. ------------------------------------------- WPC No.9130 of 2011 ------------------------------------------- Dated this the 15th June, 2011 JUDGMENT Surendramohan, J . The petitioner has filed this writ petition under Article 226 of the Constitution seeking Police protection for the conduct of the business of a hotel by name Maramon Hotel and Resorts, Maramon P.O., Pathanamthitta. According to the petitioner, the hotel is run by M/s Diamond Real Estates Private Limited, a company incorporated under the Companies Act, 1956 of which, he is the Managing Director. The petitioner further states that respondents 4 to 6 have filed a petition - Company Petition No.84 of 2009 before the Company Law Board under Sections 397, 398, 402, 403 and 404 of the Companies Act alleging mismanagement, though they do not have any right to maintain the said petition for the reason that they hold only less than 1% of the shares in the company. However, in the said petition, an interim WPC No.9130 of 2011 2 order, Ext.P1 has been issued on 16.10.2009 directing the parties to maintain the status quo in respect of the share holding pattern of the company, as on the date of the petition. The petitioner has thereupon produced Ext.P2, a list of share holders as on 30.9.2009 before the Company Law Board. It is the case of the petitioner that respondents 4 to 6 are required to have at least 10% of the share holding in the company to maintain a petition of the above nature before the Company Law Board under Section 397 of the Companies Act. The proceedings are pending. 2. Respondents 4 to 6 have also filed a petition before the Ombudsman, Local Self Government Institutions, Thiruvananthapuram against the Thottapuzhasseri Grama Panchayat, which is also pending. The petitioner has filed his objections before the Ombudsman and is contesting the matter. 3. According to the petitioner, respondents 3 to 5 have been repeatedly filing petitions before the various authorities as well as this Court without any legal right. They have recently filed WPC No.3721 of 2011 mainly for WPC No.9130 of 2011 3 the issue of a direction to the Deputy Director of Panchayats and others for passing orders restraining the petitioner from carrying on constructions in the property. Reliefs have also been sought for in the said writ petition to enforce and give effect to the order passed by the Ombudsman for Local Self Government Institutions. Other reliefs are also prayed for in the said writ petition. The petitioner has been contesting the said writ petition, which is pending. 4. The present complaint of the petitioner is that the respondents are not allowing the petitioner to continue the business of his hotel. On 29.1.2011, when the Managing Director and his family tried to enter the hotel, they were obstructed. There was threat to their life, besides threat to the property. Though the matter was reported to the second respondent - Sub Inspector of Police, there was no action. The petitioner has submitted Exts.P4 to P7 complaints before the local Police complaining about various incidents in which obstructions were caused to the peaceful running of the hotel. WPC No.9130 of 2011 4 However, according to the petitioner, no action was taken by the Police in the matter. Therefore, he has approached this Court with the above writ petition seeking appropriate directions to the Police authorities to afford protection to him for the conduct of his hotel. 5. This writ petition was admitted on 23.3.2011. On receipt of notice, respondents 4 to 7 appeared through counsel. They have filed a counter affidavit seriously disputing the contentions of the petitioner. According to them, the conduct of the hotel is illegal since no licence for conduct of the same has been issued by the Panchayat. The status of the petitioner as Managing Director of the Company is also seriously disputed. It is the case of respondents 4 to 7 that the petitioner is not competent to represent the company. It is their contention that he is not the Managing Director of the Company. Therefore, the said respondents have filed O.S.No.178 of 2011 before the Munsiff's Court, Pathanamthitta against the petitioner seeking a declaration that he is not entitled to act as the Managing Director of the Company. The plaint in the said WPC No.9130 of 2011 5 suit has also been produced as Ext.R4(b). Respondents 4 to 7 further dispute the share holding of the petitioner, as asserted by him. It is the further case of respondents 4 to 7 that no building permit has been issued by the Thottapuzhasseri Grama Panchayat for the construction of any buildings in the property owned by the company. Therefore, according to the respondents, the constructions, if any, undertaken by the petitioner are unauthorised and illegal. The respondents rely on Ext.R4 (d) order of the Panchayat Secretary dated 10.3.2010 to contend that the constructions are unauthorised. Ext.R4 (d) shows that the Secretary of the Grama Panchayat has permitted the petitioner to regularise the unauthorised constructions by payment of fine. Therefore, the respondents challenged Ext.R4(d) before the Ombudsman for Local Self Government Institutions, Thiruvananthapuram, by filing O.P.No.593 of 2010 against the same. Ext.R4(e) is an interim order passed by the Ombudsman on 10.12.2010 directing demolition of the constructions. Pursuant to Ext.R4(e), Ext.R4(f) order WPC No.9130 of 2011 6 dated 23.12.2010 has been issued by the Secretary directing demolition of the unauthorised construction. The Secretary to Government, Local Self Government Department has also issued a direction to the Secretary of the Panchayat to demolish the unauthorised construction. Therefore, it is pointed out that the hotel itself is not functioning in the premises. It is the further contention of respondents 4 to 7 that no licence to conduct a hotel has been issued by the Thottapuzhasseri Grama Panchayat. 6. The petitioner has filed a reply affidavit to the counter affidavit filed on behalf of respondents 4 to 7, producing Exts.P8 to P17 documents to support his case. Exts.P8 and P9 are relied upon to submit that he is the present Managing Director of the Company. Exts.P10 and P11 evidence the fact that a licence and consent has been issued by the Kerala State Pollution Control Board. Ext.P12 is an advertisement issued by the Kerala Financial Corporation in respect of the resort, proposing to sell the same under Section 29 of The State Financial Corporations Act, 1951. According to the petitioner, it WPC No.9130 of 2011 7 was to avert the proposed sale that the petitioner had intervened and purchased 99% shares of the company by investing as much as Rs.1.5 crores. Pursuant to the payments made by the petitioner to the Kerala Financial Corporation, it is contended that the sale was not conducted as evidenced by Ext.P13 judgment of this Court. It is the further case of the petitioner that the then Managing Director Mr.Sugathan had resigned thereafter and that he had been elected as the Managing Director of the Company. The above fact is known to respondents 4 to 7 also. According to the petitioner, he has already filed Appeal Petition No.140 of 2011 before the Tribunal for Local Self Government Institutions, Thiruvananthapuram against the order issued by the Secretary of the Panchayat directing demolition of the constructions made by him. As per Ext.P17 interim order dated 24.2.2011, such demolition has also been stayed by the Tribunal. 7. An additional reply affidavit has been filed by the petitioner producing Ext.P18 by which he was elected as the Managing Director and producing Exts.P19 and P20 WPC No.9130 of 2011 8 statutory forms submitted by the company consequent upon his election as the Managing Director and his son as a Director of the company. Ext.P22 petition has also been filed by the petitioner before the Director of Local bodies, Thiruvananthapuram to cancel the report of the Deputy Director of Panchayats, Pathanamthitta, Ext.R4(j). The petitioner has also produced copies of the register and bills of the hotel to submit that the hotel is functioning. 8. Along with I.A.No.5391 of 2011, the petitioner has produced Ext.P25 judgment in WPC No.23122 of 2010 and Ext.P26 judgment in O.P.(C)No.425 of 2010 by which the order of attachment on the property of the company was lifted and a clarification was issued to the effect that the order of attachment does not interdict conduct of the business of the hotel and resort. Additional documents Exhibits P28 and P29 have been produced along with I.A.No.879 of 2011 thereafter. Ext.P28 is a communication issued by the Thottapuzhasseri Grama Panchayat informing the petitioner that his application for renewal of licence could not be considered in view of the WPC No.9130 of 2011 9 pendency of the other proceedings before the various authorities involving his right to conduct the resort. As per Ext.P29 interim order in WPC No.15171/2011, the Secretary of the Panchayat has been interdicted from initiating any coercive steps including demolition of the structures put up by the petitioner. Along with I.A.No.9065 of 2011, the petitioner has produced a further additional document which is a complaint submitted by him to the second respondent with respect to an incident on 11.6.2011 in which, his employees were manhandled by certain persons. A counter affidavit has been filed on behalf of respondents 4 to 7 to the above petition denying the incident that is referred to in Ext.P13 and refuting any involvement on their part in any such incident. 9. We have heard Senior Adv.Sri.N.Dharmadon for the petitioner, Mr.V.Philip Mathews for respondents 4 to 7, Sri.George Mathew for the third respondent and the learned Government Pleader for respondents 1 and 2. 10. According to the counsel for the petitioner, the documents produced by him clearly prove that he is the WPC No.9130 of 2011 10 Managing Director of the Company in management of the affairs thereof. In the said capacity of his, he is conducting the Maramon Hotel and Resorts. He was possessed of a licence which was valid till 31.3.2011, for the renewal of which, he has submitted an application to the Panchayat. According to the counsel for the petitioner, in view of Section 236 of the Panchayat Raj Act, on the expiry of the period of 30 days stipulated therein, he is deemed to have been granted a licence on the strength of which, he is entitled to conduct the hotel. Exts.P4 to P7 complaints evidence the various illegal acts committed by respondents 4 to 7 in the premises of the hotel posing threat to life as well as threat to the smooth functioning thereof. Though the Police were informed of the culpable acts, they have been maintaining a stand of inaction on the various complaints. In the above circumstances, it is absolutely necessary that appropriate directions are issued by this Court to compel them to afford adequate and effective protection to the petitioner. The counsel also pressed into service a number of WPC No.9130 of 2011 11 decisions on the point to contend that this is a fit case in which an order for Police protection is to be issued. 11. The contentions of the senior counsel are vehemently opposed by Sri.V.Philip Mathews who appears for respondents 4 to 7. According to the counsel, the disputes between the parties, as disclosed from the number of documents produced in the case, are pending adjudication before various authorities. The complexity of the disputes necessitates that the rights of the parties are determined finally by the said authorities first, before any order of Police protection is granted in favour of one or the other of them. It is pointed out that the jurisdiction of this Court under Article 226 of the Constitution is ill-suited for the adjudication of the complex issues that arise for determination in the present case. Further, the grant of any order of Police protection at this stage would have the effect of tilting the balance in favour of one of the parties who are litigating before the various forums. The counsel has also relied on various decisions of this Court to support his contention that disputed questions of fact WPC No.9130 of 2011 12 should not be gone into in exercise of the jurisdiction under Article 226 of the Constitution. Therefore, he submitted that the writ petition was liable to be dismissed. 12. Advocate Sri. George Mathew, who appears for the 3rd respondent, supported the contentions of respondents 4 to 7 and referred to the various proceedings that are pending between the parties before various authorities and prayed that an order of Police protection may not be granted at this stage. The learned Senior Government Pleader, who appears for respondents 1 and 2, assured us that any complaint regarding criminal acts would certainly be attended to with promptitude. However, in the case of complaints in the present cases no action was taken for the reason that Police did not find that any such action was necessary, especially in view of the fact that the disputes were essentially civil in nature. 13. We have gone through the documents produced in detail. We have given our anxious consideration to the rival contentions advanced before us. WPC No.9130 of 2011 13 14. We find from the records that the status of the petitioner as Managing Director of the company is itself seriously disputed. Respondents 4 to 7 have initiated action under the Companies Act by filing a petition before the Company Law Board. The said company petition is Ext.R4(i). In the company petition, the allegation is that the shares of the company were being manipulated without the knowledge or consent of the said respondents with the object of altering the pattern of share holding of the company. On the said petition, Ext.P1 order has been passed by the Company Law Board directing that status quo in respect of the share holding pattern of the Company be maintained. The said order is in force. Though the petitioner has a case that respondents 4 to 7 have no right to even move such a petition before the Company Law Board, it is worth noting that they have not made any attempt to get the order of status quo vacated or to get the petition dismissed for the above reason. Suffice it to note that the said order of status quo is still in force. WPC No.9130 of 2011 14 15. Respondents 4 to 7 have also filed O.S.No.178/2011 before the Munsiff Court, Pathanamthitta against the petitioner seeking a declaration that he is not entitled to act as the Managing Director of the company. The said suit is also pending. 16. Apart from the above, the same respondents have questioned the action of the petitioner in undertaking the construction activities in the property of the company. According to respondents 4 to 7, the construction was undertaken without obtaining any building permit or licence from the Panchayat. As per Ext.R4(d) proceedings, the Secretary of the Panchayat has on a finding that the construction was unauthorised, permitted the petitioner to regularise the same by paying fine. Respondents 4 to 7 have challenged the above proceedings before the Ombudsman for Local Self Government Institutions by filing O.P.No.593/2010 contending that the action of the Secretary in permitting the petitioner to regularise the unauthorised construction by payment of fine was without any authority. In the WPC No.9130 of 2011 15 said petition, as per an interim order, the Ombudsman has ordered demolition of the said building as can be seen from Ext.R4(e). The Secretary to Government, Local Self Government Department has also issued proceedings directing demolition of the unauthorized construction, as evidenced by Ext.R4(h). It is true that as per Ext.P17, the demolition has been stayed by the Tribunal for Local Self Government Institutions. However, the fact remains that the question as to whether the construction undertaken by the petitioner is legal or not, whether the same is to be demolished or not, is yet to be decided. 17. It is the further case of respondents 4 to 7 that the petitioner's hotel does not have the requisite licence of the Panchayat. It is pointed out that no order of Police protection may be issued for the conduct of a hotel that does not have a licence of the Panchayat. Though a contention has been raised by the counsel for the petitioner that the petitioner is entitled to the benefit of a deemed licence under Section 236 of the Panchayat Raj WPC No.9130 of 2011 16 Act, the said contention cannot be accepted in view of Ext.P28. Ext.P28 is a communication issued by the Panchayat informing the petitioner that his application for renewal could not be considered in view of the serious disputes regarding his entitlement to conduct the hotel. Therefore, this is a case in which the petitioner's application for renewal of licence has not been entertained by the Panchayat at all. In other words, there is no valid application submitted by the petitioner that is pending, so as to entitle him to the benefit of a deemed licence under Section 236(3), of the Panchayat Raj Act. 18. In the above state of affairs, first of all, it is necessary that, the rights that are asserted by the petitioner to claim an order of Police protection are established in the various proceedings that are pending between the parties. It may be true that the petitioner has invested substantial amounts in the company and purchased the shares thereof. But, it is necessary to bear in mind the fact that his right to be in administration WPC No.9130 of 2011 17 and management of the company and to conduct the resort is seriously disputed and questioned at the instance of respondents 4 to 7 and proceedings are pending adjudication before the various authorities referred to above. Until and unless his rights are authoritatively determined, it is not possible for us to conclude whether the petitioner has any right to claim the reliefs that he has sought for in this writ petition. It is not possible in the interests of justice to grant the said reliefs to the petitioner at this stage for, that would have the effect of stifling the various adjudicatory proceedings that are already in progress. We are not satisfied that the petitioner has made out a case for the grant of an order of Police protection in this matter. It is up to the petitioner to pursue the other proceedings that are pending in respect of his claims and to establish his right to be in possession and management of the company and the affairs of the hotel. Until his right is so crystalised, it is not expedient to issue any orders as prayed for, in this writ petition. WPC No.9130 of 2011 18 19. To sum up, the manner of acquisition of the shares of the company by the petitioner as well as the legality of the proceedings installing him as the Managing Director thereof are pending adjudication of the Company Law Board. A civil suit is also pending, questioning the very same claim of his. The constructions undertaken by him are facing threat of demolition at the hands of the Panchayat authorities though the actual demolition has been stayed by the interim orders obtained by the petitioner. Above all and crucially, the petitioner has no Panchayat licence to conduct a hotel, since the Panbchayat has returned the application for renewal of licence submitted by him for the reason that he has not been able to substantiate his claim or right to be in management or administration of the hotel. The petitioner has thus not been able to establish any right that is required to be protected by an order of Police protection in his favour. Since we have found on facts that the petitioner is not entitled to any of the reliefs claimed, it is unnecessary to specifically advert to any of the WPC No.9130 of