BHARAT COMMERCE AND INDUSTRIES LTD. Vs. ABC

JUDGEMENT

(1.) This is an application for the confirmation by the court of the special resolution passed by the above named company relating to the proposed change of its registered office from Calcutta to New Delhi.

(2.) It is urged on behalf of the petitioner that the powers conferred on court under Sec. 17 of the Companies Act, 1956, in respect of change of the registered office from one State to another are of a limited nature. Once the court is satisfied that the special resolution has been duly passed and the necessary formalities regarding the service of the notice on the Registrar or on the other parties interested, have been complied with as provided by Sec. 17 of the Companies Act, 1956, the court after hearing the parties will have no other consideration but to confirm the said special resolution as a matter of course. It is urged following the well-established principle that the shareholders are the best persons to decide the questions relating to the internal management and affairs of the company, and that their decision should not be interfered with by the court if the formalities have been so complied with by the company in passing its special resolution. All that the court is to consider in confirming the special resolution is whether the formalities prescribed by the Companies Act, 1956, have been complied with or not.

(3.) Sec. 17 can be divided into two parts. The first part relates to the change of the place of its registered office from one State to another and the second part relates to the alteration of the provisions of its memorandum with respect to the objects of the company. Both the parts relate to the alteration of the provisions of the company's memorandum of association. In this case, this court is concerned only with the first part of Sec. 17 of the Companies Act, 1956.