KARLAPUDI VENKATESWARA RAO Vs. REGISTRAR OF COMPANIES

JUDGEMENT

(1.) THE petitioner claims to be a shareholder of a public limited company called K. C. P. Ltd. He has approached this court for the issue of a writ of mandamus directing the Registrar of Companies, the first respondent herein, not to give effect to the resolution passed on January 29, 1976 , in the 34th annual general meeting of the company but to take action under sections 234 and 234a of the Indian companies Act of 1956. THE circumstances under which the writ petition has been filed are these. THE 34th annual general meeting was scheduled to take place on 28th December, 1975 , in the usual course. But the said meeting did not take place as it is said to have been abandoned in view of the pandemonium that prevailed at the commencement of the meeting. Subsequently, the meeting was notified to be held by the board of directors on January 28, 1976 , and notices were issued to the shareholders informing them of the time and place of the said adjourned meeting. It, however, appears that one of the shareholders filed a suit, O. S. No. 45 of 1976, on the file of the District munsif, Vijayawada, for a declaration that the proposed general meeting notified to be held on January 28, 1976, is not in accordance with the articles of association and also for an interim injunction restraining the company from holding the meeting on January 28, 1976.

(2.) THE said court had granted an ad interim injunction on January 27, 1976. It is said that the said order of injunction was communicated to the company and its directors by telegram. Subsequently, the said ad interim injunction was vacated by the said court at the instance of the company on January 28, 1976. THEn the annual general meeting had been held on January 29, 1976. THE petitioner attacks the validity of the said meeting held on January 29, 1976 , on the ground that it is invalid for the reason that it was not held in accordance with the provisions of the articles of association, and that notices to the shareholders have not been issued for the meeting to be held on January 29, 1976. THE petitioner points out that the meeting as notified to be held on January 28, 1976, could not have been adjourned to January 29, 1976, as interim injunction was in force on January 28, 1976, and the company could not have contemplated that injunction would be vacated and that they will be in a position to conduct the meeting on January 29, 1976. On the materials placed by the petitioner before this court it is not possible to say that on January 28, 1976, the meeting could not have been adjourned to January 29, 1976, as that will depend upon the time when the ad interim injunction was vacated by the civil court and when the meeting was adjourned to the next day. THE petitioner's contention that the meeting held on January 29, 1976, is not valid cannot be gone into in these proceedings as the basis of attack is factual, and this court exercising its powers under article 226 of the Constitution cannot be expected to go into the disputed question of fact. Further, the relief by way of mandamus forbearing the first respondent not to give effect to the resolution passed on January 29, 1976 , cannot be granted as that will amount to preventing the statutory authority from exercising his statutory function under the Indian Companies Act. So long as the resolution dated January 29, 1976 , passed at the meeting had been recorded in the minutes of the company, the first respondent has to proceed on the basis of the minutes and record the resolution passed at the meeting in view of section 195 of that Act. As and when a shareholder or a person interested successfully challenges the validity of the meeting then it is possible for the petitioner or any person interested to approach the first respondent to modify the entries in his record. But when the resolution passed in the annual general meeting has not been held to be invalid by any court so far, no mandamus can issue to the first respondent not to perform his statutory duties. This writ petition, therefore, fails and the same is dismissed.