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2012 DIGILAW 581 (BOM)

Dmitry Rosnin v. Registrar Of Companies

2012-03-16

S.C.DHARMADHIKARI, U.V.BAKRE

body2012
Judgment : S.C. DHARMADHIKARI, J. 1. Rule. Respondents waive service. Heard forthwith. 2. By this petition under Article 226 of the Constitution of India, a writ of Mandamus or any other appropriate writ or direction in the nature of Mandamus is sought to direct the respondent/ Registrar of Companies to register a company namely Olga Consultancy Services Private Limited without insistence on the petitioners providing a local address. 3. The only issue is whether the petitioners, who are residents of Moscow, Russia and desirous of incorporating a private limited Company in the State of Goa with its registered office at Arpora, North Goa, India should be compelled to disclose their local address or else the registration cannot be effected and granted. 4. The petitioners have set out as to why they have to approach this Court. Petitioner no.1 is the spouse of petitioner no.2. They are residing at Moscow and were desirous of incorporating a Private Limited Company in the name of Olga Consultancy Services Private Limited. In the month of July, 2010, they approached the Ministry of Corporate Affairs, Government of India (DIN Cell) for the allotment of Director Identification Number in terms of Section 266A of the Companies Act, 1956 read with Companies (Directors Identification Number Rules) 2006. This request was considered and DIN numbers more particularly set out in paragraph 4 of the petition were allotted. Thereafter, the petitioners applied for on line incorporation of a Company and submitted the required eforms. This was the requirement in terms of Section 33(1) and (2) of the Companies Act, 1956. They complied with all the requirements of an applicant/ applicants seeking incorporation of a Company, which are required to be fulfilled. The requisite fees were paid, the details and the relevant information was provided. They were allotted a number SRN-A94366234 dated 20/09/2010 with regard to their application. They submitted the forms including copies of their passports. The documents were physically submitted and the originals thereof are produced for verification on 01/10/2010 as desired by the authorities. The challans and receipts in this behalf are relied upon. 5. In terms of the guidelines, all the requirements, particularly of Section 15(c) and 30(c) of the Companies Act, 1956 were duly fulfilled and complied with. The documents were physically submitted and the originals thereof are produced for verification on 01/10/2010 as desired by the authorities. The challans and receipts in this behalf are relied upon. 5. In terms of the guidelines, all the requirements, particularly of Section 15(c) and 30(c) of the Companies Act, 1956 were duly fulfilled and complied with. Despite all this, the petitioners were told to make enquiries, which they went on making, but the process of incorporation and registration of their Private Limited Company was delayed. When they approached the authorities and sought reasons for delay, they were informed by a communication dated 28/09/2010 that they have not made certain compliances and particularly that “the foreign subscribers have not stated their local address.” The petitioners' Advocate states that the present petition is confined only to this objection. As far as the other compliances are concerned, they are already made and if anything is required to be done, that would be done as well. 6. According to him, there is no requirement in any of the Rules and particularly Regulation 17 of the Companies Regulations, 1956 which mandates that the foreign subscribers must state their local address. It is submitted that this insistence is contrary to the provisions of Companies Act, 1956. This is also unfair, unreasonable and discriminatory action because the very same foreign subscribers registered a Company in India and when that was registered and incorporated, no said objection was raised. There is absolutely no explanation forthcoming as to how the Company Olga Advisory Services Private Limited with the same foreign subscribers, as in the present case, was incorporated in the State of Maharashtra on 28/10/2010 by submitting similar documents and following the same procedure. The Registrar of Companies, Maharashtra State, Mumbai did not insist on any such requirements as furnishing of local address of foreign subscribers. That being the case and when the authorities have verified the original documents and also identified the parties, then, they could not have refused to register and incorporate the said Company. Their action is, therefore, violative of Companies Act, 1956 and grossly unfair, unjust, unreasonable and discriminatory. That violates the mandates of Article 14 of the Constitution of India as well. 7. In answer to this writ petition, an affidavit has been filed by Sanjay Kumar Gupta, Registrar of Companies, Goa State. Their action is, therefore, violative of Companies Act, 1956 and grossly unfair, unjust, unreasonable and discriminatory. That violates the mandates of Article 14 of the Constitution of India as well. 7. In answer to this writ petition, an affidavit has been filed by Sanjay Kumar Gupta, Registrar of Companies, Goa State. He does not dispute the facts, but in paragraph no.9 of the affidavit states that while signing the Memorandum of Association and Articles of Association in respect of existing Company, the foreign subscribers showed their presence in India. The verification of passport reveals that the petitioners namely Dmitry Rosnin and Olga Rosnina were in India since 21/06/2010 and 22/06/2010. Since then till the application for incorporation, they were present in India. The period of stay is more than 3 months and, therefore, they have a place of residence. It is in these circumstances, the requirement of furnishing local address is insisted by the Directorate of Revenue Intelligence and other Intelligence Agency that this compliance must be made. For all these reasons, he submits that such a condition cannot be challenged and the petition be dismissed. 8. On this material, we have heard the learned Advocates appearing for the parties. 9. With their assistance, we have perused the petition and annexures thereof and affidavits on record. We have also perused the relevant provisions of the Companies Act, 1956. Mr. Amonkar appearing on behalf of the respondent was unable to point out to us anything from the applicable Rules, which requires the petitioners to give their local address. Upon query of the Court as to whether the foreign subscribers and shareholders can become directors and that a Private Limited Company with foreigners, can be registered and incorporated in India or not, the answer was in the affirmative. When we asked him as to how he justifies insistence of furnishing the local address, he placed reliance on Regulation 17 of the Company Regulation, 1956 and paragraphs 2 (1) to (4) of the said Regulation as reproduced at page 163 of the petition paper book. We have perused this regulation with his assistance and we find nothing therein, which requires the petitioners to furnish their local address. We have perused this regulation with his assistance and we find nothing therein, which requires the petitioners to furnish their local address. It is clear from the regulation that if there is no proper information or the information is defective or incomplete, then, even when the records are maintained in electronic form, the authorities can seek such details as are necessary for rectification of defects or to complete the information and forms. They can reject incomplete and defective forms. Even the Sections, which have been referred to in the affidavit namely Section 15 and 30 of the Companies Act, 1956 read with Rule 16 of the Companies (Central Government) General Rules and Forms, 1956 do not mandate furnishing of local address by the foreign subscribers. Mr. Amonkar suggested that this is necessary and relevant from security point of view and this information is required to be furnished to the Security Agency of Central Government and particularly Regional Economic Intelligence Committee. It is an inter department committee under the Ministry of Finance for coordination on economic intelligence or otherwise. Upon such submission by Shri Amonkar, we enquired as to how despite non-compliance with such requirement, a private limited company of the very foreign subscribers was registered and incorporated in the State of Maharashtra and Registrar of Companies, State of Maharashtra did not call upon the petitioners to comply with such condition, Mr. Amonkar was unable to give any answer and in fact, the affidavit of respondent is completely silent and does not deal with the averment of the Petitioners in that behalf. If annexure A to the affidavit-in-reply, which is stated to be a letter addressed by Government of India, Ministry of Corporate Affairs to Registrar of Companies, Goa, is taken into consideration, even that refers to the very provisions, which have been brought to our notice. A perusal of this provisions does not indicate that any local address has to be given. A subscriber to the Memorandum of Association and Articles of Association is required to sign the same and state his address, description and occupation. That is admittedly stated. In the letter, it is stated that a person, who is managing director of a Company present in India, should indicate his local / present address while signing the Memorandum of Association and Articles of Association. That is admittedly stated. In the letter, it is stated that a person, who is managing director of a Company present in India, should indicate his local / present address while signing the Memorandum of Association and Articles of Association. This stipulation, to our mind, would not mean that any persons like the petitioners will have to furnish the local/ present address in India as a pre-condition to seek registration and incorporation of a Private Limited Company. To our mind, when one Company of these very subscribers has been registered as a Private Limited Company in the State of Maharashtra, there was no reason why with the same persons a different Private Limited Company cannot be incorporated in the State of Goa. 10. Additionally, we sought from the petitioners Counsel a clarification as to whether this Private Limited Company, which is stated to have its registered office in the State of Goa will appoint permanent staff including the requisite officials such as Secretary, Manager etc. It was stated that they would be so appointed. It was also stated that these officers will be duly authorised by the petitioners and they would accept all notices, communications and summonses on their behalf. There is a registered office of the petitioners in the State of Goa and details thereof are duly provided including the address and that cannot be altered except in terms of the provisions of Companies Act, 1956. As far as the angle of security is concerned, there are adequate provisions in law enabling the security agencies in India to reach foreign nationals. In these circumstances, the apprehension that the foreign nationals and subscribers/ shareholders of a registered company in India, without any local support or assistance, would not be available in case any offences are committed or violations of relevant laws are noticed, is wholly unfounded. 11. We accept the statements of the petitioners' Advocate namely that the registered office of the Private Limited Company will be located at Panaji, Goa. All its details would be duly provided in the requisite forms in terms of the Companies Act, 1956. 11. We accept the statements of the petitioners' Advocate namely that the registered office of the Private Limited Company will be located at Panaji, Goa. All its details would be duly provided in the requisite forms in terms of the Companies Act, 1956. The same will not be changed or altered except in terms of the Companies Act, 1956 and that local staff such as the manager, secretary would be appointed and they would be given due authorization and powers on behalf of the petitioners so that anything that is required to be served including notices or summonses, would be accepted on their behalf and the petitioners' behalf by these officers. Equally, such officers together with the Petitioners would be liable in cases of default in compliance with the provisions of the Companies Act, 1956. All these statements having been accepted as undertakings to this Court, we do not see any basis for the apprehension expressed in the affidavit-in-reply. 12. As a result of the above discussion, the petition succeeds. The Respondent is directed to register and incorporate the private limited Company namely Olga Consultancy Services Private Limited as a Private Limited Company in the State of Goa provided the petitioners comply with all other rules and regulations and requirements thereof save and except furnishing of the local address. 13. This order does not prevent the authorities from seeking compliance by the petitioners of the other laws, but the direction shall be treated as confined to the compliance of the Companies Act, 1956 and particularly in regard to the registration and incorporation of the Companies. Equally, after the petitioners having not complied with any of the requirements enabling them to stay in India beyond stipulated period or if they are bound to be overstaying in India, necessary action in terms of the relevant laws can be initiated against them and this order does not prevent the authorities from initiating such proceedings as are permissible and in accordance with law against them. 14. The writ petition stands disposed of in aforesaid terms, but without any order as to costs.