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2009 DIGILAW 597 (GUJ)

Tata Donnelly Ltd. v. Anupam Global Soft Ltd.

2009-09-04

JAYANT PATEL

body2009
JUDGMENT : Jayant Patel, J. The present petition is preferred by the petitioner seeking winding up of the respondent-company, i.e., M/s. Anupam Global Soft Ltd., on the ground that the petitioner company has to recover the amount of Rs.1,39,644 which has not been paid in spite of the statutory notice and, therefore, the respondent-company is unable to pay and hence, be ordered to be wound up. 2. Heard Mr. Nanavati, learned counsel for the petitioner and Mr. Arvind Yadav, learned counsel for Mr. Thakkar for the respondent-company. 3. It appears that the present petition has been preferred by the petitioner-company described as "M/s. Tata Donnelly Ltd." and the contention of the respondent-company is that on the date when the petition was preferred, the said company by that particular name was no more in the list of the companies maintained by the Registrar of Companies, since after 2000, the company's name was changed to M/s. Tata Info Media Ltd., and thereafter, it was again changed to M/s. Tata Info Media (India) Ltd. 4. The second contention raised on behalf of the respondent-company is the aspect of limitation qua the alleged debt, which is sought to be recovered in the present petition. 5. It has been submitted on behalf of the petitioner that the last payment is made of Rs.1,91,000 and further the amount of Rs.1,39,644 to be recovered by the petitioner from the respondent-company is also shown as outstanding amount in the annual report and the same should be treated as the debt acknowledged and from that period if the claim is considered, it would not be barred by limitation. 6. If both the aspects are to be examined, it does appear that on the aspect of change of name, there is no dispute. On the contrary, the petitioner itself has preferred Company Application No. 39 of 2008, wherein the relevant extract of the Register of the Registrar of Companies for change of name is produced. 6. If both the aspects are to be examined, it does appear that on the aspect of change of name, there is no dispute. On the contrary, the petitioner itself has preferred Company Application No. 39 of 2008, wherein the relevant extract of the Register of the Registrar of Companies for change of name is produced. The same shows that on September 29, 2000, the name of M/s. Tata Donnelly Ltd., was changed to M/s. Tata Info Media Ltd. Thereafter, on February 17, 2004, the name of M/s. Tata Info Media Ltd., was changed to M/s. Tata Info Media (India) Ltd. Therefore, on the date when the petition was preferred, the company's name was M/s. Tata Info Media (India) Ltd., and not M/s. Tata Donnelly Ltd. This court (coram : K.A. Puj J.) vide order dated January 28, 2008, in Company Application No. 39 of 2008, which was preferred by the petitioner, had declined the amendment for correcting the description of the petitioner in the main memo of the petition for the reasons recorded therein. It has also been stated that O. J. Appeal No. 23 of 2008 has been preferred against the said decision and the said O. J. Appeal was also dismissed for default and subsequently the application for restoration of the said O. J. Appeal is preferred, in which notice has been issued and the matter is pending before the Division Bench. However, learned counsel for both the sides confirm that no stay order has been granted by the Division Bench in the proceedings of the O. J. Appeal, staying the proceedings of the present company petition. 7. Under these circumstances, even if the aspects of amendment in the description of the name is kept aside, the fact remains that the statutory notice has been served by and on behalf of M/s. Tata Donnelly Ltd., which was not the company by that name incorporated on that date. Therefore, in absence of the statutory notice on behalf of M/s. Tata Info Media (India) Ltd., which was the company in existence by that particular name, the power for winding up of the respondent company cannot be invoked. 8. Mr. Therefore, in absence of the statutory notice on behalf of M/s. Tata Info Media (India) Ltd., which was the company in existence by that particular name, the power for winding up of the respondent company cannot be invoked. 8. Mr. Nanavati, learned counsel appearing for the petitioner, did contend that though the notice was issued on behalf of M/s. Tata Donnelly Ltd., it was in substance for M/s. Tata Info Media (India) Ltd., and the same was also replied by the respondent as if it is by and on behalf of M/s. Tata Info Media (India) Ltd. In furtherance to his submission, he relied upon the provisions of section 23 of the Companies Act, 1956 and more particularly sub-section (3) of section 23, which reads as under : "23. Registration of change of name and effect thereof. - (3) The change of name shall not affect any rights or obligations of the company, or render defective any legal proceedings by or against it ; and any legal proceedings which might have been continued or commenced by or against the company by its former name may be continued by or against the company by its new name." 9. On true construction of section 23(3), it only saves the rights and obligations of the company in respect to any legal proceedings by or against it and any legal proceedings, which might have been continued or commenced by or against the company by its former name may be continued by or against the company, by its new name. Therefore, the same saves the proceedings, if already taken or may be taken, but such cannot be read to treat the statutory notice as was issued on behalf of M/s. Tata Info Media (India) Ltd., which was in reality issued for and on behalf of M/s. Tata Donnelly Ltd. Such a construction of section 23, if made, in context to the requirement under sections 433, the strict compliance of section 433, which is a must for exercise of the power by the court for winding up of any company would be frustrated. Further, the reference may also be made to the decision of the Division Bench of the Calcutta High Court in the case of Malhati Tea Syndicate Ltd. v. Revenue Officer, Jalpaiguri reported in AIR 1973 Cal 78 , and more particularly the observations made at paragraphs 19, 20, and 21 of the said decision, which reads as under (page 339) : "It is stated in the petition that an order was made by Ghosh J. on February 12, 1968, confirming the alteration of memorandum of association of the said company. This order also provided that subject to the approval of the Central Government under section 21 of the Companies Act, 1956, the name of the company should be changed from Malhati Tea Syndicate Ltd., to Malhati Tea and Industries Ltd., It appears from annexure B to the petition that the Registrar of Joint Stock Companies issued a certificate on May 3, 1968, that the name of the company be changed from Malhati Tea Syndicate Ltd., to Malhati Tea and Industries Ltd. It is stated in this certificate that the approval of the Central Government has been accorded to this change. It is therefore clear that as from May 3, 1968, Malhati Tea Syndicate Ltd., ceased to be on the Register of the joint stock companies and Malhati Tea and Industries Ltd., came into existence, and was placed on the Register of the joint stock companies from that date. The trial court delivered the judgment under appeal on July 3, 1970, and therefore long before that date, the company with its new name of Malhati Tea and Industries Ltd., mentioned above, came into existence. The memorandum of appeal was filed on February 10, 1971, but this memorandum of appeal was not filed by the company which was then on the Register of the joint stock companies, namely, Malhati Tea and Industries Ltd., but had been purported to be filed by Malhati Tea Syndicate Ltd., a name which had been removed from the Register of joint stock companies as early as May 3, 1968. There can be no doubt that on the day on which the appeal was filed, there was no company in existence by the name of Malhati Tea Syndicate Ltd., and the appeal purported to have been filed by a company which was not on the Register of joint stock companies, and had therefore no existence in accordance with the provisions of the Companies Act, 1956, cannot but be held to be incompetent. Learned advocate for the applicant contended that the appeal was competent by reason of the provisions in sub-section (3) of section 23 of the Companies Act, 1956. That sub-section runs as follows : 'The change of name shall not affect any rights or obligations of the company, or render defective any legal proceedings by or against it ; and any legal proceedings which might have been continued or commenced by or against the company by its former name may be continued by or against the company by its new name.' We are unable to accept this contention on behalf of the applicant. The first part of the sub-section protects the rights and obligations of the company, already acquired before the change of its name and also protects legal proceedings by or against it. The second part of the sub-section authorises the continuation of a pending legal proceeding which was commenced by the company in its former name. The second part provides that legal proceedings commenced by the company in its former name may be continued by the company after the change of its name. Nothing in this sub-section authorised the company to commence a legal proceeding in its former name at a time when it had acquired its new name which has been put on the Register of the joint stock companies. In this case, the memorandum of appeal had been filed by the company in its former name, namely, Malhati Tea Syndicate Ltd., which was no longer on the register of the joint stock companies. We are, therefore, of the view that the appeal itself is incompetent, as it has been purported to be filed in a name which is no longer there on the Register of the joint stock companies." 10. We are, therefore, of the view that the appeal itself is incompetent, as it has been purported to be filed in a name which is no longer there on the Register of the joint stock companies." 10. Further, merely because the statutory notice has been replied or that any such contention has not been raised and the statutory notice or such is not raised in the affidavit-in-reply filed in the present proceedings, would not operate as a bar to the respondent for raising the contention based on the question of law and the statutory requirement. 11. In view of the aforesaid, the petition cannot be maintained as it is in absence of any statutory notice served by and on behalf of M/s. Tata Info Media (India) Ltd., which is the correct name of the company in existence on the date when the present petition is filed. 12. There is considerable substance in the contention raised on behalf of the respondent on the aspects of limitation. However, as the question of acknowledgement and the last payment made is also pressed in service on behalf of the petitioner, such aspects cannot be concluded, unless there is a fact finding inquiry undertaken. Therefore, it would be for the petitioner to establish the claim in the civil suit, if so advised. If ultimately it is found that the claim is not barred by limitation, after full-fledged inquiry on facts, including on the aspects of acknowledgement of debts, further aspects of right to recover the amount can be examined and the matter can be finally decided by adjudicating the rights of both the sides in such proceedings. 13. In view of the above, it cannot be said that the defence as sought to be canvassed is non-substantial or dishonest or not bona fide. 14. In view of the above, the present petition deserves to be dismissed. Hence, dismissed. It is observed that in the event the suit is filed for the recovery of the alleged amount by the company concerned, the rights and contentions of both the sides shall remain open.