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TMI Blog2012 (10) TMI 590X X X X Extracts X X X X X X X X Extracts X X X X ..... ), West Bengal for the financial year 2002-2003. On January 27, 2006 ROC struck off the name at the instance of the Directors named above. One Nirendranath Kar claiming to be a Director applied for restoration of the name under Section 560(6) of the Companies Act, 1956. The ROC filed affidavit-in-opposition. They asserted, the company was not functioning. They filed Annual Return up to 2003 that would also depict; the company was not carrying on any business. Hence, the Registrar rightly struck off the name from the register that would not call for any interference. The learned Single Judge allowed the application vide judgment and order dated October 6, 2010. His Lordship observed as follows:- "It has been admitted in the affidavit in opposition filed by the Central Government, that the procedure under Section 560(6) of the Companies Act, 1956, has not been followed before striking off the name of the company from the register of the Registrar of the Companies. Three notices are contemplated in such Section and the sub-Sections thereunder before such action can be taken. In view of the above procedural irregularity, the decision to remove the name of the company from the regist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scrutiny in an intra-court appeal that would be barred by law. As and by way of alternative submission, Mr. Banerjee contended, no finality arrived at by the order of the learned Single Judge, at least to the extent that was appealed from. Hence, the appeal would not be maintainable. He relied on the decision in the case of A.P. State Financial Corporation -VS- Mopeds India Ltd. (In Liquidation) reported in 2007 Volume-139 Company Cases Page-514 (Andhra Pradesh) and in the case of Kamal Kumar Dutta & Another -VS- Ruby General Hospital Limited And Others reported in 2006 Volume-VII Supreme Court Cases Page-613. Replying to the preliminary issue, Mr. S.N. Mukherjee learned senior counsel contended, the decision of the Registrar to strike out a name, was an administrative act. Any person aggrieved by such action was entitled to approach the learned Company Judge under Section 560 that would be amenable to scrutiny before the Division Bench under Section 483 of the of the said Act of 1956. Assuming Section 483 would have no application, a decision of a Single Bench would always be available for an intra-court appeal under Clause 15 of the letters patent or under the Code of Civil Pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the respondent no.1 whose claim was based upon forged and fabricated documents. The learned Judge failed to appreciate, without deciding on his locus the application would not be maintainable. He relied on the following decisions to support his above contention. i) Shah Babulal Khimji -VS- Jayaben D. Kania & Another reported in All India Reporter 1981 Supreme Court Page-1786 ii) Special Deputy Collector (LA) -VS- N. Vasudeva Rao And Others reported in 2007 Volume-14 Supreme Court Cases Page-165 iii) Vijay Kumar Darwa -VS- Official Liquidator, Rohtas Inds. Itd. reported in All India Reorter 2008 Supreme Court Page-1613 Mr. Mukherjee lastly contended, Section 3(1)(3) defined private company having a minimum paid up capital of Rs.1 lac, whereas Section 3(5) would provide, a private company failing to enhance the paid up capital to the minimum one would be deemed to be a defunct company within the meaning of Section 560 and its name shall be struck off from the register by the Registrar. Mr. Utpal Moitra, learned advocate appearing for the ROC contended, the Registrar did not follow the scheme particularly Clause 9 and 10. He would however dispute the locus of the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ediless. Having no apparent error on the face of the order the Court of appeal should not interfere with the order of the learned Single Judge. He also contended, under Clause 2(4)(i) of the exit scheme this scheme would not be available when there was a management dispute. Section 560 is quoted below :- "560.Power of Registrar to strike defunct company off register.- (1) Where the Registrar has reasonable cause to believe that a company is not carrying on business or in operation, he shall send to the company by post a letter inquiring whether the company is carrying on business or in operation. (2) If the Registrar does not within one month of sending the letter receive any answer thereto, he shall, within fourteen days after the expiry of the month, send to the company by post a registered letter referring to the first letter, and stating that no answer thereto has been received and that, if an answer is not received to the second letter within one month from the date thereof, a notice will be published in the Official Gazette with a view to striking the name of the company off the register. (3) If the Registrar either receives an answer from the company to the effect that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s may be as if the name of the company had not been struck off." Under Sub-Section 1 the Registrar was empowered to strike out a defunct company from the register if he had a reasonable cause to believe, the company was not carrying on business or in operation. Under Sub-Section 1 he was to send notice to the company enquiring about its function. Under Sub-Section 2 he was empowered to strike out the name in case no reply was forthcoming within one month from the date of receipt of such notice. However he was to send another notice within fourteen days from expiry of one month period and would wait for another month to get a reply and in case reply was not forthcoming he would be entitled to strike off the name. Under Sub-Section 3 the Registrar in case of any answer having been received to the extent that the company was not in operation and not having any reply to the second letter, would be entitled to strike off the name after three months. Similar provisions were made when the company was being wound up for striking off the name. Under Sub- Section 6 a party aggrieved by any such order of striking off was entitled to approach the learned Company Judge who would be in a posit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Letters Patent and observed, where a question of jurisdiction of the court to entertain or proceed with a suit or proceeding is involved and a decision on that question is given such decision is "judgment" within the meaning of Clause 15 Letters Patent and is appellable. In the case of Liverpool & London S.P. & I Association Ltd. (Supra) paragraph 124 being relied upon is quoted below :- "124. Clause 15 of the Letters Patent is not a special statute. Only in a case where there exists an express prohibition in the matter of maintainability of an intra-court appeal, the same may not be held to be maintainable. But in the event there does not exist any such prohibition and if the order will otherwise be a "judgment" within the meaning of clause 15 of the Letters Patent, an appeal shall be maintainable." On this issue Mr. Mukherjee also relied upon Shah Babulal Khimji (Supra) being the parent judgment on the issue. Paragraphs 113, 145 and 152 were relied upon. The Apex Court observed, a judgment that decides all questions or issues in controversy and leaves nothing else to be decided that would be a final judgment available for an intra-court appeal in case the former one was delive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one issue. Registrar, if satisfied reasonably that a company was not functioning, would write to the Company asking to showcause why their name would not be struck off. Three eventualities would follow; either the Company would not reply or the Company would say, they are carrying on business or they are not. In the first and third eventuality the Registrar would be competent to strike out the name. However, in case of second eventuality the Registrar would have no power to examine the veracity of such assertion, at least Section 560 does not extend so. Mr. Banerjee would rightly contend, the learned Company Judge could not have any power under this provision wider than the original power the Registrar had. Hence, in case of any grievance the learned Company Judge would only examine whether the Registrar rightly applied his mind within the four corners of the said provisions meaning thereby - i) Has he given notice as contemplated? ii) Has he waited for the statutory period to get a reply? iii) In case he receives a reply would the reply suggest striking off as contemplated in the said provision? or, iv) Has the Registrar ignored the company's assertion that they were carryin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... core the appeal would be maintainable as it would be a "judgment" within the meaning of Clause 15 that would be available for intra-court appeal. We thus hold the present appeal maintainable. In a case of the like nature when there was dispute with regard to the status of the petitioner it would be safe for the Court to rely upon the admitted records being the records maintained by the Registrar. From the records produced by ROC appearing at pages 39 to 77 of the paper book (Volume-II), we would find, as on the date of the striking off not a single document would show the nexus of the respondent no.1 with the company. He came in picture in October 2008 through filing of DIN. Documents filed after 2008 would also show, he was Director since 1998 as claimed by him. Such dispute would have to be resolved in an appropriate forum. Section 560 would not give power to the Court to adjudicate as to such dispute. The court would be relying upon the admitted records that would clearly show, respondent no.1 did not feature in the records. His belated plea would also keep him at bay. His prayer for restoration would wait for a decision in his favour on his status by a competent civil court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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