CIVIL WRIT PETITION NO. 3021 OF 2008 -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH.
DATE OF DECISION: July 09, 2009.
Parties Name
Dr. Kartar Singh Rai
...PETITIONER
VERSUS
The Registrar of Companies and others
...RESPONDENTS
CORAM: HON'BLE MR. JUSTICE JASBIR SINGH
PRESENT: Mr. Sudhir Mittal,
Advocate, for the petitioner.
Mr. S.K.Sharma, Advocate,
for respondent No. 1.
Mr. Puneet Jindal, Advocate,
for respondents No. 2 and 3.
JASBIR SINGH, J. (oral)
ORDER:
This writ petition has been filed with a prayer that direction be
issued to respondent No. 1 to declare respondent No. 2, i.e., M/S Punjab
Motors Pvt. Ltd. as a defunct company, as per the provisions of Section 3 of
the Companies Act, 1956, (in short the Act).
It is averment of the petitioner that the Company is closed for
the last so many years. Last monthly return by the Company was filed on
March 31, 1984. It has further been stated that the Company does not have
paid up capital of more than Rs. 1,00,000/-, as is mandatory under the
aforesaid provision. By stating as above, it has been prayed that Registrar
CIVIL WRIT PETITION NO. 3021 OF 2008 -2-
of Companies (Respodent No. 1) be directed to take action under the
provisions of Section 560 of the Act (in short the Act) against respondent
No. 2.
Prayer made by counsel for the petitioner has been opposed by
respondents No. 2 and 3 by stating that the petitioner and respondent No. 3
are real brothers. Inter se litigation, regarding property left by their father
Gian Singh, is pending in various Forums and this writ petition has been
filed to settle personal property dispute.
After hearing counsel for the parties, this Court is of the
opinion that this writ petition deserves to be disposed of by issuing direction
to respondent No. 1 to take action as per provisions of Section 560 of the
Act. In this writ petition, in para No. 5, petitioner has averred as under:
“That respondent No. 2 could not function profitably and hence
the Directors resolved to wind it up. Accordingly, notice dated
July 6, 1984 was issued for holding of 9th Annual General
Meeting on July 31, 1984 at 11 AM. A true copy of this notice
is annexed as Annexure P-5. In this meeting Directors report
dated July 6, 1984, was placed before the house in which it was
stated that efforts are being made to wind up the affairs of the
Company to avoid further losses. A true copy of this report is
annexed as Annexure P-6. Subsequently, the Board of
Directors met on September 10, 1984 and formally decided to
complete the winding up procedure. The copy of the minutes
of this meeting is not available with the petitioner and this
averment is being made on the basis of the notes maintained by
him with regard to the affairs of respondent No. 2 after he was
CIVIL WRIT PETITION NO. 3021 OF 2008 -3-inducted as its Director some time in the year 1981-82. The
last annual return filed on behalf of respondent No. 2 was July
31, 1984, after which no further returns have been filed. At that
particular point in time Sh. Charanjit Singh, respondent No. 3
was the Managing Director of Respondent No. 2″
In reply to above said averment, respondent No. 1 in his reply
has stated that contents of para No. 5 are matters of record. Counsel for
respondents No. 2 and 3 has failed to rebut the averments made by the
petitioner in para No. 5 of the petitioner. It has not been controverted that
the Company do not have paid up capital of more than Rs. 1,00,000/-. It is
not functioning for the last so many years and last return was filed in the
year 1984. If that is so, this Court feels that respondent No. 1 is duty bound
to take action as per provisions of Section 560 of the Act, which reads thus:
“560(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.”
The above provision further mandates that on forming a
reasonable belief that a Company was not carrying on business or is not in
operation, the Registrar of Companies shall send a letter to the Company
concerned and thereafter take action as provided in the above said
provision.
In view of admitted facts on record, as mentioned above, there
is no reason with respondent No. 1 to say that action cannot be taken as per
provisions of Section 3 of the Act. Consequently, this writ petition is
CIVIL WRIT PETITION NO. 3021 OF 2008 -4-
disposed of by directing respondent No. 1 to initiate action as per provisions
of Section 3 of the Act and after observing the procedure laid down in
Section 560 of the Act, pass a reasoned order declaring the Company as a
defunct Company or otherwise. Needful be done within three months from
the date of receipt of copy of this order.
Copy of the order be given Dasti on payment.
July 09, 2009. ( Jasbir Singh ) DKC Judge