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TMI Blog2006 (7) TMI 324X X X X Extracts X X X X X X X X Extracts X X X X ..... - Dated:- 11-7-2006 - DR. AR. LAKSHMANAN AND LOKESHWAR SINGH PANTA, JJ. J.B. Dadachanji for the Appellant. Ms. Pragya Singh Baghel, Debmalya Banerjee, R.N. Karanjawala and Mrs. Manik Karanjawala for the Respondent. JUDGMENT Dr. AR. Lakshmanan, J. - None appears for the appellant despite service of notice on the appellant. 2. It appears that the previous counsel sought direction from this Court to discharge him as advocate-on-record. Notice was also sent by speed post A.D./Courier to M/s. Associated Journals Ltd., Lucknow, U.P. and M/s. Associated Journals Ltd., New Delhi requesting them to contact them otherwise they will not be in a position to attend to the above matter and will seeks direction from this Court for discharge as advocate-on-record. When the matter was taken up for hearing on 12-4-2006, a submission was made by the learned counsel appearing for the appellant that no reply has been received from the addressee till date and, therefore, further time may be granted. The matter was adjourned by four weeks. Even today, there is no representation on behalf of the appellant. The counsel is also not present in the Court. 3. We have heard Ms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company being unable to pay any debts to the respondent. The winding up petition filed by the respondent was, therefore, wholly without any basis or foundation in law and hence not maintainable. 7. Company Appeal No. 1 of 1994 was filed against the order dated 10-1-1994 passed by the Company Judge in Company Petition No. 3 of 1987. In the said appeal, the appellant had challenged the order of Company Judge on several grounds. We are not now considering the merits of the grounds alleged in this appeal since it is premature for this Court to deal with the same at this stage. 8. It is submitted by the appellant that in view of the mandatory statutory provisions of rules 18 and 21 of the Companies (Court) Rules, 1959 governing the verification of the contents of the winding up petition, the said winding up petition was not maintainable in the light of the admitted fact that the petition had not been verified by the respondent in accordance with the provisions of the said rule 21. It is further submitted that because the winding up petition which is not supported with affidavit in accordance with law and is violative of rules 18 and 21 of the Companies (Court) Rules, 1959 and is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pended to the Rules. Form in paragraph-2 requires the contents of the petition to be true to the knowledge of the deponent and the contents based on information to be stated and verified separately. To this extent, the verification is not proper." 13. The learned Single Judge has also referred to a judgment of the Division Bench of the said Court in Pradeshiya Industrial Investment Corpn. of Uttar Pradesh Ltd. v. North India Petro Chemicals Ltd. [Company Appeal No. 1 of 1993, dated 27-8-1993]. The Division Bench considered the aforesaid case and some others and found : "Considering the aforesaid decisions the ground which has been canvassed in favour of treating a defect, in verification as fatal is that it may create confusion about the date of the institution. Rule 21 of the Companies (Courts) Rules requires the verification to be made in a specific manner. Yet it does not provide that non-compliance of this rule would render the winding up petition infructuous. As has been pointed out by the Hon ble Supreme Court, rules of procedure are only to ensure certain ends. Verification is insisted upon to render the person who verifies, responsible for the statement con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isted before the learned Company Judge for passing fresh orders regarding advertisement of the Company Petition. It is useful to reproduce the finding recorded by the Division Bench : "We are in full agreement with the law laid down by the Division Bench and the petitioner has been rightly provided opportunity to rectify the defect of the affidavit by filing fresh affidavit for removal of the defect in swearing clause of the affidavit. The case of the respondents is not prejudiced in any manner nor there was any bar of limitation to come in the way. The winding up petition has already been admitted and any amendment or correction to rectify the defect of the affidavit by filing fresh affidavit at this stage would not be so fatal to dismiss the petition. The Court has always discretion to allow the amendment of pleadings, reswearing or reverification of the petition. The defects thus could be cured subsequently even after filing of the petition." 16. In this context, it is beneficial to reproduce Form No. 3 of the Companies (Court) Rules, 1959 : "FORM NO. 3 [ See rule 21] [Heading as in Form No. 1] Company Petition No................ of 19............ Affidavit ve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Court in an identical matter in Malhotra Steel Syndicate v. Punjab Chemi-Plants Ltd. 1993 Suppl. (3) SCC 565 has also opined that even if there is some slight defect or irregularity in the filing of affidavit, the appellant should have been given an opportunity to rectify the same. In the instant case, the same liberty was given to the respondent by the Company Judge as also by the Division Bench of the High Court. We are, therefore, of the opinion that the Division Bench was right in dismissing the appeal filed by the appellant. 20. This Court has in catena of decisions held that substantial compliance is enough. Rules are undoubtedly statutory and the forms are to be adopted wherever they are applicable. The Rules relating to the affidavit and the verification cannot be ordinarily brushed aside, but then what is required to be seen is whether the petition substantially complies with the requirements and secondly, even when there is some breach or omission whether it can be fatal to the petition. In the instant case, both the learned Company Judge and also the Division Bench were of the opinion that there is substantial compliance of rule 21. In Khaitan Overseas Financ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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