TALAYAR TEA COMPANY LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) THESE writ appeals are preferred against the common judgment in W. P. Nos. 3343 and 3538 to 3543 of 1983 dated March 31, 1989. The writ petitions were filed against the order of the Company Law Board dated February 10, 1983, passed under section 111 of the Companies Act, 1956, hereinafter referred to as "the Act", by the Talayar Tea Company Ltd., a public limited company, incorporated on January 10, 1945, and having its registered office at Coimbatore. The shares of the company are listed on the Madras Stock Exchange. The second respondent (ranking of parties as in writ petitions) moved the Company Law Board under, section 111 of the Act for directing the rectification of the register of members of the company by entering the names of the respective second respondents in relation to the shares purchased by them and which were produced along with the requisite applications at the registered office of the company for carrying out the transfer. They were tendered on December 17, 1980, through their advocates, but still the company having refused to register the documents by stating that the share certificates were returned 'since the instruments do not conform to section 109(1A) of the Companies Act, 1956" * the appeals had to be filed to the Company Law Board.

(2.) AN earlier attempt made to tender the share certificates to the petitioner-company to register the same on. November 8, 1979, having been rejected unauthorisedly by the director and general manager of the company, the company petitions have been filed in this court for rectification of the company's register and on their dismissal, C. S. A. Nos. 28 to 35 of 1981 have been filed and they are pending disposal. The Company Law Board, after hearing the parties passed the impugned order on February 10, 1983, directing the company under section 111(5) to transfer the share certificates in favour of the writ petitioners. The learned judge upheld the above order and it resulted in the filing of the writ appeals.One of the crucial points raised before the learned judge and in these appeals, is whether the requirements under section 154 of the Companies Act are mandatory or only directory in nature. After referring to the meaning ascribable to the expression "newspaper" as found in various dictionaries and different enactments and on taking into account the inbuilt provisions found in the said section, the learned judge held that its requirements are mandatory in nature.

(3.) IF it be held that the requirements of section 154 are mandatory in nature and that the publication found in the Daily Official List of Stock Exchange Limited would not be an advertisement in a newspaper, then there is no need to consider any other point, because if the closure between those dates was not lawfully done, then the refusal to receive the share certificates as presented on December 17, 1980, could not have been done. Section 154 reads as follows :