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TMI Blog1999 (4) TMI 487X X X X Extracts X X X X X X X X Extracts X X X X ..... he Companies Act, 1956 ('the Act') is condition precedent for the presentation of winding up or more importantly, for the grant of the reliefs asked for as the resumption of commercial insolvency flows from non-compliance with the provisions of the statutory notice and secondly, on the ground that there are certain serious defects in the pleadings. A third point was also argued, namely, that there is a discrepancy with regard to the actual amount due as different figures have been set out at different times and that consequently, if there is uncertainty with regard to this important head, that the petition itself is liable to fail because the Court would not be in a position to hold that a prescribed amount constituted the unpaid liability. 2. I shall dispose of the third objection first because it emanates from the contention canvassed by the respondents' learned counsel that there has to be a level of certainty with regard to the outstanding debt and he has placed reliance on a decision reported in 1990(3) Co. LJ 322. He has drawn my attention to the fact that as often happens, various figures have been set out in the correspondence and in the calculations and he contends tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nted for or reflected and where certain credits have got to be adjusted and this is a matter of simple mathematics and to my mind would not be fatal to the petitioner. All that the Court has, therefore, got to adopt is a simple process of reconciliation and if through such a process it is possible to quantify the outstanding, then the petition would still survive. In the present case, I have looked at the nature of the objection pleaded under this head and I do not find any real difficulty in being able to quantify the exact and correct outstanding as per the record. This objection, therefore, does not survive. 4. With regard to the principal objection canvassed namely, that the statutory notice was not addressed to the registered office and that it does not conform with the legal requirements. The respondents' learned counsel drew my attention to the decisions in ML. Mehta Cinema Enter prises ( P. ) Ltd v. Pravinchandra P. Mehta [1991 ] 70 Comp. Cas. 31 (Bom.) and 1973 Co. L.J 200 in support of his contention that admittedly, in the present instance the statutory notice not having been addressed to the registered office and delivered there, that it is a fatal infirmity. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... another submission, namely, that out of abundant caution the petitioners have addressed a subsequent notice to the registered office of the respondent-company and that, therefore, this Court can take note of the fact that even if the respondents insist on technical compliance, that this has been duly met. As regards this last argument, Mr. Chandy submitted that there may be other situations in which a Court would permit corrective steps but his contention was that the statutory notice is more or less on par with notice under section 80 of the Code of Civil Procedure, 1908, or in other words, notice that is to precede the litigation and he submitted that it would be a dangerous precedent if the Court were to permit a virtual mandatory obligation, namely, the need to give prior notice to be by passed on the ground that the notice was sent after the litigation was commenced. Elaborating on this argument, Mr. Chandy submitted that the spirit behind the requirement of prior notice emanates from the fact that it is intended to forewarn the party of the intending consequences if the case is to be taken before a judicial forum and to thereby forestall a possible litigation by affordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter which has some how not been considered in any of the earlier decisions. It is true that in numerous cases, the Courts have upheld the contention that non-service of notice on the registered office of the company is fatal but the aspect of substantial compliance has really not been examined in depth. Whereas the objective is to ensure that the notice is served on the registered office of the company which is the nerve centre for a variety of reasons, the question arises as to whether in that small category of cases where the notice is served in good faith on an office that is sufficiently large and sufficiently important and where administrative functions are carried out and from where the notice is bound to be forthwith transmitted to the registered office, it could be held that there is substantial compliance of the requirements. What effectively happens in such a situation is that notice has been given to the company, that the notice has reached one of its important administrative centres since it has been transmitted to the registered office from there, it would really be a case of service on the registered office through another office. I do not for a minute propose to d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... National Paints ( P. ) Ltd [1986] 60 Comp. Cas. 402 (Punj. Har.), the respondents' learned counsel submitted that the verification is not in strict compliance with the requirements and that the affidavit is not in accordance with Form No. 3 and rule 18B of the Company Court Rules. While Mr. Naganand contended that the affidavit is in compliance with the Rules and that the verification of the exhibits was not required to be separately done because they are referred to in the body of the petition and are covered by the affidavit, I need to observe that there is again considerable substance in the objection canvassed. It has unfortunately become the order of the day particularly in our High Court to resort to several shortcuts and when it comes to a question of drafting of pleadings and presentation of the case papers, to again short circuit the requirements of the Rules. These, however, are not so gross in the present instance nor do they constitute such serious breaches as would justify dismissed of the petition on these grounds nor for that matter would it justify a Court refusing to look at certain parts of the pleadings of the petitions merely because of these blemishes whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mation turns out to be incorrect or outdated, the classical one being where the registered office has been shifted and the change has not been intimated to the Registrar. The question arises whether in such situations because of the physical fact that the statutory notice has been addressed to an office of the company that is not or no longer is the registered office, the petitioners should be penalised and made to withdraw the petition and refile it. Again, this is a gray area but that is precisely the reason why this Court has laid down the aspect of good faith and bona fides as opposed to a mischeivious situation where the notice is deliberately addressed to a quarter where it would not come to the notice of the company as also the fact that if there are faults or if there are clandestine changes that the company should not be allowed to benefit there from and that is the precise reason why the Court would still uphold the maintainability of the petition on the ground of substantial compliance. 11. In the light of the aforesaid findings, the preliminary objections do not survive and are overruled. The respondents are given four weeks time to file their objections and to fu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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