AJN 00-OS-1642.03 1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL (LODGING) NO.171 OF 2011 IN NOTICE OF MOTION NO.230 OF 2011 IN SUIT NO.195 OF 2011 AND DRAFT NOTICE OF MOTION Lalit Kumar Modi, Indian Inhabitant, through his constituted attorney Mehmood M. Abdi, Indian Inhabitant, having address at A-901, Meera Towers, Oshiwara, Andheri (West), Mumbai – 400 053. ) ) ) ) ) ) ) ... Petitioner Versus 1. Board of Control for Cricket in India, a Society registered under the Tamil Nadu Societies Registration Act, 1975, having Registered Office at M.A. Chidambaram Stadium, 5, Victoria Hostel Road, Chepauk, Chennai – 600 005, and its Head Office at Cricket Centre, Wankhede Stadium, “D” Road, Churchgate, Mumbai – 400 020, through its Secretary. ) ) ) ) ) ) ) ) ) ) ) ) ) AJN 00-OS-1642.03 2 2. Mr. Chirayu Amin Alembic Ltd., Alembic Road, Vadodara, Gujarat – 390 003. ) ) ) 3. Mr. Arun Jaitley, A-44, Kailash Colony, New Delhi – 110 044. ) ) 4. Mr. Jyotiraditya Scindia, 27, Safdarjang Road, New Delhi – 110 001. ) ) ) ... Respondents Mr. Ram Jethmalani, senior counsel with Mr. Amit Desai, senior counsel, Abhishek Singh and Gaurav Gopal i/b Wadia Gandhy & Co. for the appellant. Mr. Rafique Dada, senior counsel with Mr. T.N. Subramanian, senior counsel, Mr. P.R. Raman, Ms. Akhila Kaushik, Mr. Indranil Deshmukh, Mr. Rahul Mascarenhas and Mr. Adarsh Saxena i/b Amarchand Mangaldas & S.A> Shroff & Co. for respondent 1. CORAM: MRS. RANJANA DESAI & R.G. KETKAR, JJ. DATE ON WHICH THE JUDGMENT IS RESERVED : 22ND MARCH, 2011. DATE ON WHICH THE JUDGMENT IS PRONOUNCED: 5TH APRIL, 2011. P.C. :- (Per Smt. Ranjana Desai, J.) 1. Order dated 4/3/2011 passed on Notice of Motion No. 230 of 2011 in Suit (L) No.195 of 2011 is challenged in this appeal. The appellant is the original plaintiff. Respondent AJN 00-OS-1642.03 3 1 is the Board of Control for Cricket in India (for short, “the BCCI”) which is a society registered under the Tamil Nadu Societies Registration Act, 1975 (for short, “the said Act”) and the Tamil Nadu Societies Registration Rules, 1978 which are the rules framed under the said Act (for short, “the said Rules”). Respondents 2, 3 and 4 are members of the Disciplinary Committee constituted by the BCCI to enquire into the alleged acts of indiscipline and misconduct committed by the appellant as Administrator of the BCCI which were detrimental to the game of cricket. 2. Few facts will have to be noted before we proceed to deal with the challenge raised in the appeal. The appellant came to be appointed as the Chairman and Commissioner of the Indian Premier League (for short, “the IPL”) sometimes in the year 2008 by BCCI. On 24/9/2009, in the Annual General Meeting (for short, “the AGM”) a Disciplinary Committee (for short, “the DC”) consisting of the President - Shashank Manohar, AJN 00-OS-1642.03 4 respondent 2 – Chirayu Amin and respondent 3 – Arun Jaitley was appointed under Rule 1(q) of the Rules and Regulations of the BCCI (for short, “the BCCI Rules”), which require the President to be a part of the Committee. Show Cause Notices dated 26/4/2010, 6/5/2010 and 31/5/2010 were issued to the appellant in respect of his alleged misconduct as the Commissioner of the IPL. 3. The appellant sent replies to the show cause notices to the BCCI stating, inter alia, that the Secretary should be wholly excluded from the disciplinary proceedings and the President as also the Governing Council Members should recuse themselves as they may be required to give evidence. The appellant addressed a Letter dated 25/5/2010 to the President – Shashank Manohar demanding that he should recuse himself on the ground, inter alia, that he would be calling the President as a witness before the DC. On 19/6/2010, the Secretary of the BCCI referred the charges levelled against the AJN 00-OS-1642.03 5 appellant to the DC. On the same day, the President Shashank Manohar recused himself from the proceedings. He issued a direction to the Secretary to convene a Special General Meeting (for short, “the SGM”) to ratify / approve the Secretary's decision to refer the charges against the appellant to the DC and to constitute a DC for holding enquiry against the appellant. On 3/7/2010, the SGM was conducted in which the decision to refer the charges to the DC was unanimously approved/ratified and the DC comprising respondent 2 – Chirayu Amin, respondent 3 – Arun Jaitley and respondent 4 – Jyotiraditya Scindia was constituted. A letter was addressed to the appellant on the same day informing him that the DC was to hold its meeting on 16/7/2010. By letter dated 6/7/2010, the appellant raised objections with regard to some members of the DC particularly with regard to respondent 2 – Chirayu Amin. The appellant filed Writ Petition No.1370 of 2010 in this court challenging the constitution of the DC in the SGM of 3/7/2010. The Division Bench of this court rejected the AJN 00-OS-1642.03 6 petition on 15/7/2010 observing that the role of the DC was only to submit the report. Ultimately, it is for the General Body to take a decision and if none of the members withdraw from the DC, nothing prevents the appellant from challenging the constitution of the DC along with the challenge he may raise against the final order of punishment, if any. 4. The DC comprising respondents 2, 3 and 4 by its order dated 11/8/2010 rejected the appellant's application for exclusion of certain members of the DC. The appellant filed Writ Petition No.1909 of 2010 challenging the said order. The Division Bench dismissed the petition holding that the allegations of bias made by the appellant against the members of the DC of BCCI are not such that they cannot be examined in the proceedings which the appellant may institute if all the findings of the DC and consequently the final decision of the BCCI go against him. AJN 00-OS-1642.03 7 5. Both the orders of this court mentioned hereinabove are challenged by the appellant in the Supreme Court. Admittedly, special leave petitions are pending and no interim relief is granted to the appellant. 6. On 29/9/2010, the AGM of BCCI was conducted. The DC which is normally appointed at every AGM was not appointed. The said appointment was not even part of the agenda. The appellant filed an application on 21/11/2010 before the DC for discontinuation of proceedings till validly formed DC is appointed contending that Rule 1(q) of the BCCI Rules requires that DC should be appointed at every AGM with the President as one of the members. It was contended that since no DC was appointed in the AGM held on 29/9/2010 as per Rule 1(q) of the BCCI Rules, the DC constituted in the AGM held on 24/9/2009 and in the SGM dated 3/7/2010 cannot continue post AGM held on 29/9/2010. On 23/11/2010, the BCCI responded to the appellant's application negativing appellant's contention. AJN 00-OS-1642.03 8 7. On 27/11/2010, notice of the SGM was issued by the Secretary of the BCCI. It's agenda was to (1) extend tenure of the DC consisting of Mr. Jaitley, Mr. Scindia and Mr. Amin, (ii) to ratify proceedings of the said DC constituted in the SGM of 3/7/2010 and to constitute a DC for the year 2010-2011 under Rule 1(q). The explanatory statement to the notice clarified that the SGM was being held as and by way of abundant caution even though the tenure of the DC constituted on 3/7/2010 would not come to an end until the completion of the enquiry against the appellant. 8. On 11/12/2010, the SGM of BCCI was conducted. It was unanimously resolved that the tenure of the DC constituted on 3/7/2010 of Mr. Jaitley, Mr. Scindia and Mr. Amin was extended and proceedings of the said DC were ratified and another DC under Rule 1(q) was appointed with President as one of the members for the year 2010-2011. AJN 00-OS-1642.03 9 9. On 24/12/2010, the appellant filed the instant suit inter alia seeking declaration to the effect that the notice dated 27/11/2009 issued by the BCCI calling for the SGM is illegal, null and void and the SGM dated 11/12/2010 held in pursuance of such notice is illegal and any decision taken in the said SGM dated 11/12/2010 is illegal, null and void. The appellant took out the instant notice of motion praying inter alia that pending the hearing and final disposal of the suit, the respondents be restrained by an order of temporary injunction of this court from conducting any enquiry through the DC constituted by the BCCI on 11/12/2010 and proceeding further with the disciplinary proceedings. By order dated 4/3/2011, learned Single Judge dismissed the said notice of motion. That order is challenged in this appeal. 10. We have heard at considerable length Mr. Jethmalani, learned senior counsel appearing for the appellant and Mr. Dada, learned senior counsel appearing for the respondents. AJN 00-OS-1642.03 10 11. Mr. Jethmalani submitted that the main issue involved in this appeal is about the validity of the SGM held on 11/12/2010 called by notice dated 27/11/2010. Counsel drew our attention to Rule 1(q) of the BCCI Rules and submitted that it contemplates creation of a DC at an AGM which shall last till the next AGM with jurisdiction to try every case that arises during its tenure against any player, administrator and employee. Rule 1(q) is exhaustive so far as power to appoint a Committee is concerned. No additional power can be read into it. That is the only power of appointment of a Committee. Rules of the BCCI are a contract. The BCCI is bound by them. No other power can be imported in a contract. Counsel submitted that on 24/9/2009, a DC was appointed for the year 2009-2010 under Rule 1(q) and charges against the appellant were referred to it on 19/6/2010. In the SGM held on 3/7/2010, the President was substituted by Mr. Jyotiraditya Scindia. Counsel submitted that if for any reason the Committee cannot function or ceases to exist AJN 00-OS-1642.03 11 as constituted, another can be created only according to Rule 1(q) at the next AGM. The DC so created will have jurisdiction/power to deal with all offenders. There cannot be a DC created for a specific individual. The BCCI Rules do not contemplate such a DC. Counsel submitted that the DC appointed in the AGM on 24/9/2009 came to an end in September, 2010. In the AGM held on 29/9/2010, no DC was appointed as required by Rule 1(q). Counsel submitted that, therefore, to cover up this illegality, on 11/12/2010, the SGM was conducted by the BCCI to ratify proceedings of the DC constituted in SGM held on 3/7/2010. Counsel submitted that the entire exercise is illegal. Counsel submitted that an invalid / non-existing DC cannot be revived by ratification or extension. In this connection, counsel relied on the judgment of the Supreme Court in T.P. Daver v. Lodge Victoria No. 363, SC Belgaum & Ors. AIR 1963 SC 1144, where the Supreme Court has observed that the source of power of associations like clubs and lodges to expel their members is the contract on the basis of which they became AJN 00-OS-1642.03 12 members. This contractual origin of the rule of expulsion has its corollary in the cognate rule that in expelling a member the conditions laid down in the rules must be strictly complied with. 12. Counsel submitted that the BCCI is a Society registered under the said Act and, therefore, governed by the said Act and the said Rules. Counsel pointed out that the said Act and the said Rules make provisions for meetings and for notice to be given for the meetings. Section 26 of the said Act provides for an AGM. Section 26(2) provides that notice of every such AGM has to be given within such period as may be prescribed before the day appointed for the meeting. Rule 25 of the said Rules provides for 21 days' notice before the day appointed for AGM. Counsel pointed out that Section 28 provides for Extra-Ordinary General Meeting (for short, “the EOGM”). Sub-section (3) thereof states that no EOGM shall be deemed to have been called if the members of the registered Society have not been given such notice AJN 00-OS-1642.03 13 thereof as required by Sub-sections (2) and (3) of Section 26. Rule 27(2) of the said Rules states that the provisions of Rule 25 regarding notice of the General Meeting to the members shall apply to an EOGM also. Counsel submitted that despite this, for the SGM held on 11/12/2010, notice was given on 27/11/2010. Thus, though relevant Rules provided for 21 days' notice, only 14 days' notice was given. The said meeting is, therefore, invalid. Counsel submitted that Rule 17(iii) of the BCCI Rules which enables the President to convene the SGM with 10 days' notice is ultravires and void as the parent legislation i.e. the said Act provides for 21 days' notice. Rule 17(iii) is contrary to the parent statute. 13. In this connection, counsel drew our attention to the judgment of learned Single Judge of Madras High Court dated 20/4/2001 in Mr. R. Karuppan, Advocate v. Mr. P.K. Rajagopal, Secretary, The Advocates Association & Ors. in Application No.1843 of 2001 in Original Application No.291 of 2001 in Chamber AJN 00-OS-1642.03 14 Summons No.249 of 2001 and submitted that in that judgment learned Single Judge has while construing Clause 70 of the bye-laws of the Society held that Clause 70 which provided that notices of the meeting of General Body of the Association shall be deemed sufficient under the Rules if affixed on the Notice Board of the Association 3 days' before the day fixed for the meeting, was contrary to Sections 26 and 28 of the said Act read with Rules 25 and 27 of the Rules and, therefore, Clause 70 of the bye- laws is not valid. Counsel submitted that the ratio of this case is clearly attracted to the present case and learned Single Judge has wrongly held that in R. Karuppan, the Madras High Court has not considered Section 2(j) and Section 55 of the said Act and has, therefore, given an erroneous finding. 14. Counsel submitted that reliance placed by learned Single Judge on the judgment of the same learned Judge of the Madras High Court in Mahajna Educational Board v. State of Tamil Nadu & Ors. dated AJN 00-OS-1642.03 15 4/1/2005 in Writ Petition Nos.4399 of 2001, 11019 of 2002, 448 of 2003 and 37048 of 2004 is wholly misplaced. In that case, the Madras High Court has considered Section 55 of the said Act. However, Section 28(3) of the said Act excludes the operation of Section 55. 15. Counsel drew our attention to Chapter 5 of Craies on Statute Law (Seventh Edition) which bears the heading “Construction where the meaning is plain”. Relying on the observations contained in this chapter, counsel contended that if the words of the statute are themselves precise and unambiguous, then no more can be necessary than to expound those words in their ordinary and natural sense and a statute may not be extended to meet a case for which provision has clearly and undoubtedly not been made. Counsel submitted that if the said Act and the said Rules do not provide for a second DC to be constituted till the next AGM, the court cannot expand their scope and hold that such a DC can be constituted on the ground of necessity. Counsel AJN 00-OS-1642.03 16 submitted that learned Single Judge has clearly erred in taking such a view. In this connection, counsel relied on Delhi Development Authority v. Durga Chand Kashish (1973) 2 SCC 825 and Union of India & Anr. v. Devki Nandan Aggarwal, 1992 (Supp.) 1 SCC 323. Counsel submitted that the impugned order in the circumstances, deserves to be set aside. 16. Mr. Dada, learned senior counsel appearing for the BCCI on the other hand submitted that no interference is necessary with the impugned order because learned Single Judge cannot be said to have acted unreasonably or capriciously in exercise of his discretionary power. In this connection, counsel relied on Wander Limited v. Antox India (P) ltd. (1990) Supp. SCC 727 and Printers (Mysore) Pvt. Ltd. v. Pothan Joseph AIR 1960 SC 1156. Counsel submitted that there is no provision under the BCCI constitution which says that the tenure of the DC comes to an end at the next AGM. He submitted that DC once constituted and seized of a AJN 00-OS-1642.03 17 particular proceeding must continue till the conclusion of the inquiry, because otherwise that would result in an absurd situation. Learned Single Judge has rightly relied upon the doctrine of necessity while construing Rule 1(q). Applying the said doctrine, it must be held that DC can be constituted if necessary without the President in a given case and it can coexist with a DC which includes the President as the other delinquents may insist that the President must be part of the DC. 17. On the doctrine of necessity, counsel relied on Election Commission of India & Anr. v. Dr. Subramaniam Swamy & Anr. (1996) 4 SCC 104 and State of U.P. v. Shiv Shankar Lal Srivastava & Ors. (2006) 3 SCC 276. Counsel submitted that it is because the appellant raised an objection that constitution of DC was changed. He cannot now raise hyper-technical objections to avoid inquiry. No prejudice is caused to the appellant because of the BCCI's action. The onus is on the appellant to show prejudice. He has failed to discharge it. AJN 00-OS-1642.03 18 In this connection, counsel relied on the judgment of the Supreme Court in Union of India & Ors. v. Alok Kumar (2010) 5 SCC 349. Counsel submitted that the appellant does not even have a prima facie case. The balance of convenience is in favour of respondent 1. Hence, the appeal be rejected. 18. By the impugned order, learned Single Judge has refused to pass an order of temporary injunction restraining the respondents from conducting any inquiry through the DC constituted by the BCCI on 11/12/2010 and proceeding further with the disciplinary proceedings. Thus, learned Single Judge has refused to exercise his discretionary power in favour of the appellant. It is well settled that the appellate court must be very cautious while dealing with the discretionary order passed by the trial court. Such orders are not to be interfered with lightly. A very strong case of arbitrary or unreasonable exercise of power must be made out to warrant interference with the discretionary order. In The AJN 00-OS-1642.03 19 Printers (Mysore) Private Limited's case, the Supreme Court has observed as under: “It is ordinarily not open to the appellate court to substitute its own exercise of discretion for that of the trial Judge; but if it appears to the appellate court that in exercising its discretion the trial court has acted unreasonably or capriciously or has ignored relevant facts and has adopted an unjudicial approach then it would certainly be open to the appellate court – and in many cases it may be its duty – to interfere with the trial court's exercise of discretion. In cases falling under this class, the exercise of discretion by the trial court is in law wrongful and improper and that would certainly justify and call for interference from the appellate court.” 19. Again in Wander Limited's case, the Supreme Court has observed as under: “The appellate court will not interfere with the exercise of discretion of the court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had AJN 00-OS-1642.03 20 ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against exercise of discretion is said to be an appeal on principle. Appellate court will not reassess the material and seek to reach a conclusion different from the one reached by the court below solely on the ground that if it had considered the matter at the trial stage, it would have come to a contrary conclusion. If the discretion has been exercised by the trial court reasonably and in a judicial manner, the fact that the appellate court would have taken a different view may not justify interference with the trial court's exercise of discretion.” 20. Examined in the light of the above principles, we are of the opinion that the impugned order does not call for any interference from us because it is not possible to say that learned Single Judge has exercised discretion arbitrarily or capriciously. In fact, the discretion has been exercised by learned Single Judge reasonably and in a judicial manner as would be evident from the following discussion. 21. Validity of meeting held on 11/12/2010 is questioned AJN 00-OS-1642.03 21 by the appellant. This meeting was convened on the direction of the President under Rule 17(i)(a) of the BCCI Rules. Under Rule 17(iii), the President may at his discretion direct the Secretary to convene SGM at shorter notice in which case a notice of at least 10 days be given. We need to examine whether Rule 17(iii) of the BCCI Rules is ultra vires the said Act and, therefore, the meeting convened at shorter notice is illegal. 22. Section 26 of the said Act provides for AGM. Sub- section 2 thereof states that notice of every such general meeting shall be given by the registered Society to its members within such period as may be prescribed. Rule 25 of the said Rules states that notice of general meeting of the Society under Sub-section (2) of Section 26 shall be given to the members at least 21 days before the day appointed for such meeting. Thus, Section 26 and Rule 25 relate to AGM. Section 28 of the said Act provides for EOGM which may be called by a Committee only after receipt of a requisition in writing from such number of AJN 00-OS-1642.03 22 members as may be specified. Under Sub-section 3 of Section 28, no EOGM shall be deemed to have been duly called if the members of the registered Society have not been given such notice thereof as is required by Sub- Sections (2) and (3) of Section 26. Rule 27 of the said Rules refers to EOGM and Sub-rule (2) thereof states that provisions of Rule 25 regarding notice of general meeting to the members shall apply to an EOGM. Thus, 21 days' notice is also prescribed for EOGM. But, it is important to bear in mind that Section 26 read with Rule 25 and Section 28 read with Rule 27 refer to AGM and EOGM respectively. They have no relevance to the present case because on 11/12/2010, the BCCI conducted a SGM. 23. Rule 17 of the BCCI Rules makes a special provision for a different kind of meeting called SGM. Under Rule 17(3), the President may at his discretion convene a SGM at shorter notice in which case a notice of at least 10 days shall be given. Thus, to meet the exigencies of a situation, express provision is made for ten days' notice AJN 00-OS-1642.03 23 for holding the SGM. Whereas, Section 26 read with Rule 25 and Section 28 read with Rule 27 (of the said Act and the said Rules) refer to the AGM and the EOGM respectively and Rule 17 of the BCCI Rules refers to the SGM. These are distinct categories of meetings and, hence, there is no question of Rule 17(iii) of the BCCI Rules being ultra vires the said Act. 24. Reference may also be made to Section 2(j) of the said Act which provides for a special resolution and proviso thereto states that a notice of less than the period prescribed