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Issues: Application under section 633 of the Companies Act for relieving the company and its directors and officers from liability for default in complying with sections 210, 220, and 159 - Seizure of account books by Special Police Establishment affecting audit and preparation of financial documents - Opposition by Registrar of Companies on technical grounds and merits - Distinction between defaults under sections 210/220 and section 159 - Relief granted by the court with conditions.
In this case, the company, Asia Udyog Private Limited, filed an application under section 633 of the Companies Act seeking relief from liability for not complying with sections 210, 220, and 159 of the Act. The company and its directors and officers were unable to have the accounts audited, prepare a balance sheet, profit and loss account, and file an annual return due to the seizure of all account books by the Special Police Establishment in November 1953. Despite efforts to retrieve the books, they remained in the custody of the Commission of Inquiry presided over by Mr. Vivian Bose. The company argued that without access to the account books, compliance with the statutory requirements was impossible not only for the current year but also for subsequent years. The court noted that similar petitions had been previously allowed by the District Judge, indicating a precedent for granting relief under such circumstances. The Registrar of Companies opposed the petition on technical grounds, which were either resolved or not pursued, and on the merits. However, it was acknowledged that the account books were seized and remained unavailable for audit and preparation of financial documents. The Registrar suggested that the company could file statements of income and expenditure, as well as receipts and payments based on the currently maintained accounts. The Government Solicitor highlighted a distinction between defaults under sections 210/220 and section 159, emphasizing the requirement of filing particulars specified in Part I of Schedule V within 42 days of the annual general meeting under section 159. The court agreed that while it might not be feasible to provide all details from Part II of Schedule V, the company should submit particulars as near as possible to the prescribed form. Ultimately, the court granted relief to the company, its directors, and officers from liability for default under sections 210/220 and 159 of the Act. However, certain conditions were imposed. The company was directed to furnish statements of income and expenditure, as well as receipts and payments for the relevant financial year, based on the current accounts within two months. Additionally, a statement containing particulars required under section 159 was to be submitted as closely as possible to the form in Part II of Schedule V. Each party was ordered to bear its own costs related to the application.
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