JUDGMENT : R.N. Misra, J. - This is on application u/s 17 of the Companies Act, 1 of 1956 (hereinafter referred to as the "Act") for confirmation by Court of the special resolution for alteration of the Memorandum. 2. Messrs Orissa Cement Limited with its registered office at Rajgangpur in the State of Orissa was registered in October. 1949, as a Company limited by shares. Its authorised capital was rupees five crores as detailed in paragraph 3 of the application. Annexure-B is the Memorandum of Association in Clause III whereof the objects for which the Company was established have been enumerated. The Company went into production soon after its incorporation and as the annual reports of 1972 and 1973 go to show the affairs of the Company had been going on well. At the ordinary general meeting held on 30th October, 1973 at the registered office of the Company, a Special Resolution as provided u/s 189 of the Act was duly-passed after compliance with the requirements of the law. A full text of the Resolution is extracted below: Resolved, by way of Special Resolution, that the following amendments be and are hereby made in Clause III (Objects clause) of Memorandum of. Association of the Company, provided, however, that the said amendments shall not take effect until and except in so far as, the same are confirmed by, the Court: (i) The following are added at the end of Sub-clause (2) of Clause III: (f) Midget electrodes, carbon rods of all kinds, electrodes of all kinds, batteries, battery cells, bulbs, wires, cables, dynamos, motors, fans, stoves and all other electrical goods, radios, transistors, electronic equipments including television and computer all or any parts required for any of the above; (g) All kinds of calcium carbonate, all chemicals, basic intermediary or otherwise, all varieties of Alkalis, acids, drugs, fungicides, pesticides, fertilizers and petro-chemicals of all kinds. Pharmaceutical, medicinal and chemical preparations; (h) All kinds and classes of paper, board and pulp cutlery, knives, scissors, razors, and blades; (i) Sugar, sugar products, confectionary, dry and preserved fruits, juices, vegetables, bread, flour' biscuits, baking materials, processed foods, vegetable oils, containers of all kinds and description; (j) All kinds of cotton, silk, artificial silk, woollen, linen, jute, hemp, synthetic fibres and yarn, textiles or other articles made of anyone or more of these; (k) Rubber, natural and synthetic, leather, imitation leather, cloth, plastic, oil,cloth, linoleum, hospital sheetings and all other articles of any description made from or prepared with rubber, leather or plastic; (l) Abrasives in all forms, alumina, aluminium and all derivatives therefrom; (m) Ships, boats, barges, tugs and all other vehicles of water transport of all kinds and description; (ii) In Clause III, the following six new sub-clauses are added after the existing Sub-clause (2) and the said new sub-clauses are numbered as (2A), (2B), (2C), (2D), (2E) and (2F); (2A) To carry on the business of agriculturist, planters, cultivators, farmers and to plant, cultivate, preface, convert, treat or manipulate all kinds of food stuffs, oil seeds, vegetables, vegetable products, fruits, grass, timber, bamboo, straw, cotton, jute, rubber, sugarcane, tea, coffee, coconuts, cashew' nuts, tobacco and other articles that are the produce, of land or soil and to sell, purchase and deal in the same as Principals or Agents. (2B) To carry on business as dealers in, and producers of, dairy, farms, and garden produce of all kinds, and in particular milk, cream, butter, ghee, cheese, poultry and eggs, fruits and vegetables. (2C) To carry on the business of iron founders, steel founders, non-ferrous metal founders, mechanical engineers, structural engineers, electrical engineers, manufacturers of cast iron and steel pipes, manufacturers of grinding medias, manufacturers of agricultural implements, other machinaries, air-conditioners, refrigerators, consumer and domestic appliances, tool makers, metal workers, boiler makers, mill wright machinists, iron and steel, converters. (2D) To carry on the business of builders, contractors, promoters, of all types of construction including roads, bridges, towers, factory buildings, residential flats, d welling houses, hotels, restaurants shops, offices, and for that purpose, organise, incorporate and manage co-operative societies. (2E) To deal in, purchase, sale, exchange and/or transfer of securities, shares, debentures and all other forms of investments either for ready or on forward transactions and to carry on all kinds of investment business. (2E) To deal in, purchase, sale, exchange and/or transfer of securities, shares, debentures and all other forms of investments either for ready or on forward transactions and to carry on all kinds of investment business. (2F) To carry on the business of the letting on hire, hire purchase, or easy payment system of appliances, fittings, machines; equipments vehicles, furniture, wireless and television receivers and other apparatus and all other things of whatsoever nature or description capable of inclusion in this class of business. (iii) Sub-clause (8) of Clause III is revised to read as follows: (8)(a) To undertake, transact and execute all kinds of agency business and to render all kinds of services technical, managerial or otherwise. (b) To act as Advisers, Consultants or,Manager and to render advice, assistance, guidance, in any capacity whatsoever, to any person, Firm or Company, on all aspects of business organisation and industry and to advise upon the means and methods for extending, developing all types of business and industry and all systems or processes relating to production, storage, distribution, marketing and sale of goods and/or relating to rendering of services. (iv) The existing Sub-clause (29) at Clause III is revised to read as follows: 29. To undertake and execute any Trust, the under taking of which may seem desirable to the Directors, to make or receive gifts of any kind, cash or otherwise, for any purpose whatsoever. It has been stated that the Directors of the Company considered that in its interest as also in the interests of the share holders, it was necessary to expand and diversify the business activity of the Company by athorising the Company, inter alia, for rendering technical and other services to concerns abroad and/or setting up of joint ventures in foreign countries, in view of the fact that on agreement for joint venture to set up a refractories manufacturing unit in Philippine has been entered into recently. Simultaneously the Company may also be authorised to undertake in future some other activities as listed in the Special Resolution. 3. The Company has pleaded that it has adequate resources for undertaking further diversified business activities. Simultaneously the Company may also be authorised to undertake in future some other activities as listed in the Special Resolution. 3. The Company has pleaded that it has adequate resources for undertaking further diversified business activities. In paragraph 8 of the application, it has been stated that the Company has not issued or agreed to issue any secured Debentures and only in March, 1970, has issued 25 numbers of 1 percent Unsecured Debentures of rupees one lakh each, amounting to rupees twenty-five lakhs and the same has been redeemed on 20-10-1973. The Company has taken unsecured foreign currency loan from the Industrial Credit and Investment Corporation of India. Limited, to the tune of about 48 lakhs of rupees. It has been alleged that the Company has over draft facilities from the United Bank of' India. The Government of India and the State Government have also advanced amounts under the Subsidized Industrial Housing Scheme. 4. Notice of this application was duly published in the daily Samaj, the Statesman as also in the State Gazette. Notice was also served on the Registrar of Companies as required u/s 17(4) of the Act. 5. In his counter affidavit, the Registrar of Companies took the stand that there was no disclosure that the proposed activities could be conveniently and advantageously combined with the Company's existing business and that the Company had not disclosed the sources of finance required for implementation of the proposed activities. In the counter affidavit it was further pointed out that the provisions of the Monopolies and Restrictive Trade Practices Act, 1969, were applicable to the Company and unless the scheme involving expansion was cleared by the Central Government under that Act, the petition would not be maintainable in law. 11 was further pointed out in the counter affidavit that the latest balance sheet to which reference has been made has not been filed before the Registrar of Companies. 6. The Company has filed a further affidavit meeting the objections raised in the Registrar's affidavit and has produced on order of the Government of India in the Ministry of Law, Justice and Company Affairs dated 29th of January, 1974, to which reference shall be made presently. 7. It is appropriate, therefore, that I first deal with the objection of the Registrar with reference to the provisions of the Monopolies and Restrictive Trade Practices Act, 54 of 1969. 7. It is appropriate, therefore, that I first deal with the objection of the Registrar with reference to the provisions of the Monopolies and Restrictive Trade Practices Act, 54 of 1969. Section 20 of that Act occurs under Part-A of Chapter III and 1 deals with 'concentration of economic power'. That section specifies undertakings to which Part-A shall apply Section 21(2) is to the following effect: Notwithstanding anything contained in any other law for the time being in force, no undertaking shall give effect to any proposal for its substantial expansion unless such 'proposal has been' approved by the Central Government. The Explanation clarifies the term "substantial expansion" and is to the following effect: For the purpose of this section, on undertaking shall be deemed to expand substantially if, after such expansion: (a) in the case of on undertaking to which Clause (a) of Section 20 applies (i) the value of its assets, before the expansion, would result in on increase by not less than twenty-five percent of such value or (ii) the production, supply or distribution of any goods or the provision of any services by it before the expansion, would result in on increase by not less than twenty-five per cent, of the goods produced, supplied, distributed of controlled; or services provided by it; (b) in the case of on undertaking to which Clause (b) of Section 20 applies, the production, supply, distribution or control of any goods or the provision of any services by it would result in on increased by not less than twenty five per cent, of the goods produced, supplied, distributed or controlled at services provided, by it before the expansion. The Petitioner-Company has produced on order dated 29th of January, 1974 to the following effect: With reference to your letter cited above on the question of applicability of the provisions of Section 20 of the M.R.T.P. Act to your undertaking, I am directed to say that there is no arrangement for giving a clearance to individual undertaking directly in the absente of specific proposals before the Government for expansion, industrial licence, setting up of new undertakings etc, as envisaged in Chapter III of the Act. With regard to the show cause notice issued to your company under this Department letter of even number dated 8th February, 1972 on consideration of the facts furnished by your company as up to 18-6-1973 and the representations made by your company or your representatives, it has been decided not to pursue the same for the present. I am, however, to add that the matter is subject to review in due course as and when fresh particulars are available on the applicability of Section 2(g) and/or 20 of the Monopolies and Restrictive Trade Practices Act. It may be noticed that the onus for registration lies with the undertaking and should register itself if it becomes registrable in future under the Monopolies and Restrictive Trade Practices Act, 1969. Learned Government Advocate appearing for the Registrar concedes that in view of the aforesaid order of the appropriate Ministry, the objection raised by the Registrar with reference to the Special Act does not apply. 8. The next question for consideration is as to whether the alteration proposed should be confirmed. The 3rd clause of the Memorandum of Association provides the objects for which the Company is established. 40 different heads have been indicated. The proposed amendments are with reference to Sub-clauses (2), (8) and (29) of Clause 01. It has also been proposed to add six new sub-clauses after Sub-clause (2) to be marked as (2A) to (2F). 9. Mr. Mohanty for the Company has placed before me three decisions of this Court relating to alteration in the Memorandum. The first of these three cases is that of Straw Products Ltd. Vs. Registrar of Companies. Referring to Section 17 of the Act, this Court held that: (i) The language of Section 17(1)(d) of the Companies Act permits the alterations in the Memorandum Association of a company to enable it to carry on a business which is entirely a new departure from the business already carried on provided (a) that such business is one which can be conveniently or advantageously combined with the existing business of the company and (b) that this must be so under the existing circumstances and not under hypothetical circumstances. The additional business need not be even akin to the existing business but it must not be destructive of or inconsistent with and detrimental to the existing business. It must leave the existing business substantially what it was before. The additional business need not be even akin to the existing business but it must not be destructive of or inconsistent with and detrimental to the existing business. It must leave the existing business substantially what it was before. (ii) The question whether any additional business is one which may be conveniently or advantageously combined with the business of the Company carried on at the time when the special resolution is passed, is essentially a business proposition and must be determined by the persons engaged in the business of the Company. xx xx xx It was further indicated that the fact that the Company is in a sound financial position, and that the share-holders unanimously or by majority decision seek alterations of the Memorandum is a factum in favour of confirmation thereof. The principle laid down in the aforesaid case has more or less been followed in the two other decisions: The Bharat Salt and Chemical Industries Ltd. 1971 (2) C.W.R. 835, and In re Samantrai Farms (P) Ltd. 1974 (1) C.W.R. 160. Reference has also been made to two other decisions. The leading English case on the point is In re Parent Tyre Company 1923 (2) Ch. 222, Limited Referring to the corresponding provision in the English Act then in force, Lawrence, J, indicated that the new business may be wholly different from, and bearing no relation to the then existing business of the Company and yet be capable of being conveniently and advantageously combined with it. If the new business is not destructive of or inconsistent with the existing business, a confirmatory order may be given. In the case of In Re: Standard General Assurance Co. Ltd. the learned Company Judge dealt with the matter at length and indicated that when a Company seeks to alter its objects with a view to carry on some new business, if the Company's position is financially sound, if the alterations are fair to all classes of members of the Company and if the rights of creditors are in no way prejudiced, such alterations should be confirmed provided the requirement of the statute is complied with. It is not a matter for the Court to determine as to what business the Company should carry on. It is not a matter for the Court to determine as to what business the Company should carry on. If the Directors and members of a Company propose to alter its objects and if there is no objection from the creditors or if their position is not prejudiced by the proposed alterations, the Court should not stand in the way of the Company's seeking new objects to enable it to embark on a new venture. The obvious limitations are that the new business must not be destructive of or inconsistent with the existing business. There must be some existing business which the company should be carrying on at the time w hen it passes the resolution for altering its objects and such business must be carried on under its existing object clauses. The Company's financial position must be sound to enable it to carry on the new-business. Subject to limitations mentioned, the wisdom of the Directors and members of the Company in regard to the decision to carry on the new business proposed under the altered object must prevail. It has been always accepted that the best judges of the policy of the Company as the requirements of the statute are complied with are the Directors and the share-holders. 10. The creditors in this case in spite of notice have not raised any objection. There is nothing on the record to show that by the new ventures proposed to be undertaken they would in any manner be prejudiced. Soundness of the financial position of the Company seems to be beyond doubt. There is no impediment for the confirmation of the Special Resolution. I would accordingly in terms of Section 17(5) of the Act confirm the proposed alterations in terms as given in Annexure-C to the petition and direct that appropriate steps be taken. There should be no direction as to costs. Accordingly answered.