2005 (9) TMI 301 - SC - Companies Law

Provisional registration certificate as a small scale industry from the Director of Industries of Government of Maharashtra obtained - Held that - Unable to accept the contention of the appellant-company that by changing the members of the board of directors of the company or by changing the shareholding pattern, the appellant-company had undergone any change. The very same company wanted the electricity connection without making any payment towards the electricity charges payable by the previous consumer and the matter was dealt with in detail by the High Court and it was held that the appellant-company is none other than the sister concern of Amar Amit Jalna Alloys (P.) Ltd. and was representing the same consumer who had committed the default and it was held that condition 23(b) of the conditions of miscellaneous charges for supply of electricity energy would apply to the appellant-company. Thus by change of directors or by change of pattern of the shareholding, the appellant-company is really a different entity than Amit Products (India) Ltd. who filed the previous. The reasons given in the previous judgment which were confirmed by this Court would apply with all force against the present appellant-company and the High Court has rightly dismissed the writ petition filed by the appellant-company.

Summary

Issues:
1. Electricity connection denial based on arrears of previous consumer.
2. Claim of distinct corporate entity by the appellant.
3. Change in board of directors and shareholders.
4. Geographical location of the appellant's property.
5. Previous legal proceedings and dismissal of appeals.

Analysis:
1. The appellant, a company seeking electricity connection, faced denial by the Maharashtra State Electricity Board (MSEB) due to outstanding charges of a previous consumer. The appellant argued it was a separate entity from the defaulter and not liable for the arrears.

2. The High Court previously rejected a writ petition by the appellant, stating that despite changes in directors and shareholders, the company remained linked to the previous defaulter. The appellant contended that the corporate entity had transformed, emphasizing differences in ownership and location from the defaulter.

3. The appellant highlighted changes in the board of directors and shareholders, asserting a disconnect from the previous defaulter. However, the court found these changes insufficient to establish a new corporate identity separate from the one involved in the previous legal proceedings.

4. The appellant clarified its property possession, indicating a distinct location from the previous defaulter on the property. This geographical distinction was presented as evidence of the separation between the appellant and the defaulter.

5. Previous legal battles, including Supreme Court appeals and petitions, were cited by the respondent to argue against the appellant's fresh appeal. The court upheld the previous judgments, emphasizing the continuity of the corporate entity and dismissing the appellant's claims of transformation.

In conclusion, the Supreme Court upheld the High Court's decision, emphasizing that changes in directors and shareholders did not alter the corporate identity. The court found the appellant to be the same entity as the previous defaulter, leading to the dismissal of the appeal.