Delhi High Court High Court

Sahara Deposits & Investments (1) … vs Majidan And Ors. on 2 September, 1993

Delhi High Court
Sahara Deposits & Investments (1) … vs Majidan And Ors. on 2 September, 1993
Equivalent citations: 1993 IIIAD Delhi 1088, 1993 (27) DRJ 398
Author: U Mehra
Bench: U Mehra


JUDGMENT

Usha Mehra, J.

(1) This Court had ordered service of respondent by affixation. The affixation was done at the last known address of the respondent. The Process Server has deposed on the summons that there was no witness available hence affixation could not be evidenced by any witness. This Court, accordingly, did not treat it to be a proper service on the respondent as it was not evidenced by any witness as required under the Rules.

(2) Counsel for the O.L. Mr. B.N. Nayyar contended that it was a proper service and the objection raised by this Court is not sustainable. ‘According to him the Original Side rules of this High Court are not applicable to the proceedings pending before the Company Court. ‘

(3) The Company Court has to follow the Companies (Court) Rules 1959, (hereinafter called the Company Rules) or at best the provisions of Code of Civil Procedure, but by no 399 stretch Of imagination the provisions of Original Side Rules of the High Court can be attacked to the proceedings before the Company Court.

(4) In order to strengthen his arguments, Mr.B.N. Nayyar, Sr. Standing Counsel for the Official Liquidator, contended that under the Sub-rule 2(5) of the Companies Rules the word ‘Court’ means the Court having jurisdiction under the Act. According to him, the Act means the Companies Act 1956. Under Rule 6 of the said Rules, the practice and procedure of the Court and the provisions of the Code so far as applicable shall apply to all proceedings under the Act and these Rules. The Registrar may decline to accept any document which is presented otherwise than in accordance with these rules and procedure of the Court. Laying emphasis on the words ‘Practice and Procedure of the Court’ Mr. Nayyar contended that practice and procedure which is mentioned under Rule 6 does not mean that the practice and procedure followed on the Original Side of the High Court, because Company Court does not fall under the definition of Original Civil Jurisdiction as defined under Section 129 of the Code of Civil Procedure. Hence, this Court not exercising the Original Civil Jurisdiction, therefore, the rules framed by the High Court under the Original Civil Jurisdiction, will not apply.

(5) Mr. Nayyar further contended that powers to frame rules have been given to the High Court under Part X of the Code of Civil Procedure. Section 122 empowers the High Courts to frame rules from time to time relating to their own procedure. Rule 128 deals with the matter for which rules may be provided in the High Court. All the rules framed by the High Court under Section 122 to 128 have to regulate High Court’s own procedure in the exercise of its Original Civil Jurisdiction. He, therefore, contended that the Company Court does not fall under the definition of Original Civil Jurisdiction.

(6) No rigid rules have been laid down for Company Court. Its rules are based on equity and principle of natural justice. Under the Company Rules no provisions are provided for the evidencing of the affixation by one witness. In the absence of any specific rule in this regard we can look to the Code for assistance as envisaged under Rule 6. Rule 6 of the Companies Rules reads as under :- “Save as provided by the Act or by these rules the practice and procedure of the Court and the provisions of the Code so far as applicable…….”

(7) According to Mr. Nayyar once it is established that the Companies (Court) Rules are silent, regarding procedure to be followed for effecting service by affixation then we can bank Upon the procedure laid down under the Code so far as appalicable. Now reading the provision of Rule 17 of Order 5, Cpc, it becomes quite clear that when the defendant cannot be found inspite of due diligence the serving officer shall affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily resided and shall then return the original summons to the Court with report endorsed thereon that he has affixed the copy, the circumstances under which he did so, and the name and address of the person (if any) by whom the house was identified and in whose presence the copy was affixed. Word “if any” is very significant. This indicates that if the Process Server, in the circumstances is unable to find any person to witness the affixation, then that will not annul the affixation nor will make it defective by any manner. Legislature, while drafting the provisions of Order 5 Rule 17, 400 Cpc, was conscious of the fact that the circumstances can arise when it is difficult for the Process Server to find out a witness. It is for this reason that the word “if any” has been used. leaving the discretion to the Court to decide whether service by affixation was proper or not.

(8) It is also true that while passing the order neither this Court nor the Deputy Registrar imposed any condition that the affixation should be evidenced by one witness. In the’ absence of any such order, the Process Server’s affixing the summons at the last known address of the respondent without being evidenced by any witness will not invalidate the service by way of affixation as observed by this Court.

(9) Mr. Nayyar went to the extent of contending that even the Companies (Court) Rules 1959 are only directory and not mandatory. This was so held by the Punjab & Haryana High Court in the case of Punjab Finance Private Limited (in liquidation) Vs. Malhara Singh and Others reported in (1975) Vol .45, Company Cases, page 225 and by the Bombay High Court in the cases of Amba Tannin and Pharmaceuticals Ltd. Vs. Official Liquidator, High Court, Bombay and others and United India Fire and General Insurance Co. Ltd. Vs. Official Liquidator, High Court, Bombay and others.

(10) So relying on these authorities and the Rules framed by the Supreme Court known as Companies (Court) rules 1959 and the provisions of the Code of Civil Procedure, it is apparent that the Original Side Rules of High Court are not applicable. The affixation not evidenced by one witness cannot be declared to be ineffective or defective by any means.

(11) After analysing the various provisions quoted by Mr. Nayyar I find force in the submission of Mr.Nayyar that the Original Side Rules framed by the High Court under Section 129 of the Code of Civil Procedure will not apply automatically to the Company Court. This court is not bound by the practice and procedure adopted by the High Court on the Original Side or the rules framed there under. As Mr. Nayyar has rightly put the Company Court does not fall under the definition of Original Civil Jurisdiction as mentioned under Section 129 of the Code. Hence for the purpose of its practice and procedure it can either rely on its own rules or the provisions of the Code of Civil Procedure and even the High Court Rules. Since the Company Court Rules are silent regarding the service of the respondent by affixation, this mode of service has been relied on the basis of the provisions laid down in the Code of Civil Procedure. Therefore, for the purpose of knowing whether it ought to have been evidenced by one witness. we have to fall back on the provisions of Rule 17 of Order 5, which does not lay down that if the serving officer does not get the affixation witnessed from any witness then such affixation will beineffective. On the contrary the word ‘if any’ used in Rule 17 of Order 5, Cpc, clearly shows that the Legislature had in mind that circumstances can arise when it will be difficult for the serving officer to find a witness. In such an eventuality, the affixation done without being evidenced by any witness will not be declared ineffective or bad in law. Unless specifically ordered otherwise the service effected by way of affixation on the respondent even without being evidenced by a witness such a service will not be treated as invalid service. Hence the order passed earlier treating it to be invalid service is hereby revised and it is ordered that the respondents have been properly served.