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1988 (9) TMI 287 - HC - Companies Law

Issues:
1. Competency of the signatory in the plaint to sue on behalf of the plaintiff company.

Analysis:
The case involved a dispute regarding the competency of the signatory, Mr. N. Ananthasivan, designated as the secretary of the plaintiff company, to sign and verify the pleadings on behalf of the plaintiff company, Cardamom Marketing Co. (Travancore) Ltd. The defendant argued that Mr. Ananthasivan, despite being the secretary as per the company's articles of association, lacked the authority to sign and verify the pleadings as his appointment had not been approved by the Central Government, as required under the Companies Act. The defendant contended that this lack of approval rendered the suit not maintainable. However, the plaintiff's counsel relied on clauses 27 and 29 of the articles of association, which empowered the secretary to sue and be sued on behalf of the company. The plaintiff further argued that Mr. Ananthasivan could be considered the principal officer under Order 29, rule 1 of the Civil Procedure Code, as he was managing the company's affairs at the relevant time.

The court examined the relevant provisions of the Companies Act and the Civil Procedure Code. It noted that Order 29, rule 1 allowed for any director, principal officer, or secretary of a corporation to sign and verify pleadings on behalf of the corporation, provided they were able to depose to the facts of the case. The court emphasized that the key requirement was the ability to depose to the facts stated in the pleadings. While acknowledging that Mr. Ananthasivan's appointment as secretary had not been approved by the Central Government, the court found that he was managing the company's affairs and was capable of deposing to the facts of the case. The court cited precedents, including a Privy Council decision, to support its view that the purpose of verifying pleadings was to ensure the signatory could depose to the facts. Consequently, the court rejected the defendant's argument that the pleadings were not properly signed and verified, affirming the lower court's decision in favor of the plaintiff.

In conclusion, the court dismissed the Civil Revision Petitions (C.R.Ps) filed by the defendant, upholding the lower court's decision. The court found that Mr. Ananthasivan, despite lacking Central Government approval for his appointment as secretary, was competent to sign and verify the pleadings on behalf of the plaintiff company based on his ability to depose to the facts of the case. The judgment highlighted the importance of ensuring that the signatory of pleadings could attest to the facts presented, ultimately affirming the validity of the suit initiated by the plaintiff company.

 

 

 

 

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