1999 (12) TMI 771 - SC - Companies Law

Whether the complaint for the offence punishable under section 113(2) of the Companies Act, 1956, could be filed only where the registered office of the company is situated or where the complainant is residing? Held that - Appeal dismissed. Section 113, which, inter alia, provides that the company shall deliver the documents, such as, certificates of shares, debentures and certificates of debenture stocks allotted or transferred in accordance with the procedure laid down in section 53. Section 53 prescribes the mode of delivery, inter alia, by sending the document by post at registered address and sub-section (2) is the deeming provision for delivery of such letter. Thus the conclusion that the cause of action would arise at the place where registered office of the company is situated.

Summary

Issues:
1. Jurisdiction question - Whether complaint under section 113(2) of the Companies Act, 1956, can be filed where the registered office of the company is situated or where the complainant is residing.

Analysis:

Background:
The appeals involved a jurisdictional question regarding the filing of complaints for offenses under section 113(2) of the Companies Act, 1956. The appellant filed criminal cases in Karnataka, alleging offenses by respondent-companies. The High Court of Karnataka addressed the issue of territorial jurisdiction, considering the location of registered offices of the companies and the residence of the complainant.

Relevant Legal Provisions:
Sections 53 and 113 of the Companies Act, 1956 were crucial in determining the jurisdictional aspect. Section 113 mandates the delivery of share certificates within specified timeframes, as per the procedure in section 53. Failure to comply attracts penalties under section 113(2).

Key Arguments and Decisions:
The appellant contended that the cause of action should also arise where he resided, citing a Rajasthan High Court decision. Conversely, the respondent argued that the High Court's decision aligns with sections 113 and 53, referencing a Patna High Court ruling.

Court's Analysis and Conclusion:
The Supreme Court analyzed the statutory provisions, emphasizing the mode of document delivery prescribed in section 53. It noted that the place of performance of statutory duty is where the document is posted, typically the location of the registered office. The Court referenced a previous case regarding dividend payments to support the jurisdictional principle.

Precedent and Final Decision:
The Court highlighted a Rajasthan High Court decision but ultimately dismissed the appeals. It noted that the cause of action for non-compliance with document delivery requirements arises where the registered office of the company is situated, in line with the Patna High Court's interpretation and the Supreme Court's past ruling.

In conclusion, the Supreme Court upheld the principle that the jurisdiction for offenses under section 113(2) of the Companies Act, 1956, lies where the registered office of the company is located, based on the statutory provisions and legal precedents cited during the proceedings.