RICHA JAIN Vs. REGISTRAR OF COMPANIES

JUDGEMENT

(1.) MISS Richa Jain, petitioner in Company Petition No. 19 of 1985 and Universal Investment Trust Ltd., in Miscellaneous Petition No. 20 of 1985 have prayed that the order of initiation of winding up proceedings against Sahu Minerals and Properties Ltd. on the petition of the Registrar of Companies, Rajasthan, be declared illegal and the order of winding up dated August 8, 1978, be quashed. In both the petitions, an application has been filed under Section 391(2) of the Companies Act, 1956, for sanctioning a scheme of compromise and arrangement between the creditors and the company, Sahu Minerals and Properties Ltd. Since in both the petitions the factual position and the legal points involved are the same, they are being disposed of by this common order.

(2.) BRIEFLY stated, the facts of the case are that the Registrar of Companies filed a petition for winding up of the company, Sahu Minerals and Properties Ltd. (hereinafter referred to as 'the company') under Section 395(5) read with Section 433(c) of the Companies Act, 1956. The winding -up petition was admitted by this court on April 6, 1977, and notices were issued and the notices were also published. The case proceeded ex parte, againstthe company and ultimately this court, vide its order dated August 8, 1978, passed a winding -up order. After the passing of the winding -up order, the official liquidator attached to this court took over possession of the company's properties. The official liquidator, during the winding -up process, moved an application before this court being Miscellaneous Petition No. 157 of 1984, for fixing some date to notify claims as required under Rule 147 and to publish an advertisement in the newspapers under Rule 148. During the course of winding -up proceedings, this court, vide order dated December 27, 1987, passed in Miscellaneous Petition No. 186 of 1984, allowed the official liquidator to dispose of the property of the company situated at 19 -A, Alipur Road, Calcutta, and invite tenders for the sale of the said property. In both the petitions, it is contended that the property, which was proposed to be auctioned and sold as aforesaid, is under the security and charge of Universal Investment Trust Ltd. and without first getting the charge of the said company cleared and getting the title deed released from the said company, no sale or auction proceedings should have been allowed or commenced. In both the petitions, the petitioners have challenged the winding -up order on various grounds. It is contended by the petitioners that Sahu Minerals and Properties Ltd. is a mining company, both under the provisions of the Coking Coal Mines (Nationalisation) Act, 1972, as well as the Coal Mines (Nationalisation) Act, 1973, and, as such, in accordance with the provisions of Sections 28 and 32 of the aforesaid Acts, no proceedings for the winding -up of Sahu Minerals and Properties Ltd. could be initiated except with the previous sanction of the Central Government and, because no such sanction of the Central Government was obtained for moving the petition for winding -up, consequently, the order dated August 8, 1978, passed by this court for winding -up of the company, is not valid. It is also contended that the winding -up petition was filed under Section 439(5) read with Section 433(c) of the Companies Act and Section 433(c) provides that if a company does not commence its business within a year from its incorporation or suspends its business for a whole year, then the said company may be ordered to be wound up by the court on an application filed by the Registrar of Companies and such application should be filed by the Registrar only after obtaining the previous sanction from the Regional Director, Company Law Board, and, since no such sanction was obtained by the Registrar, the proceeding initiated for winding up was bad in law. It is also submitted in the petition that the mandatory provisions which require to be observed by the court for issuing a notice under Rules 24, 99, 112, 113, 147 and 148 were not observed. In the premises, it is contended that in view of the various infirmities and non -compliance of the mandatory provisions of law, the winding -up proceedings against the company were bad and a prayer is made in both the petitions to quash and set aside the winding -up proceedings and the winding -up order passed by this courton August 8, 1978, and further proceedings taken for sale and auction of the company's property.

(3.) IN both the petitions, returns have been filed by the Registrar of Companies, respondent No. 1, and the official liquidator, respondent No. 2. The Registrar of Companies opposed the application under Section 466 of the Companies Act for quashing and setting aside the order of liquidation and, also the application under Section 391 of the Companies Act for sanctioning of a scheme of compromise and arrangement. The official liquidator, in his reply, has also opposed the petitions. In the reply, it is submitted that the provisions of the Companies Act were not violated before the order of winding up was passed. It is also submitted that the petition under Section 466 of the Companies Act is not maintainable at the instance of contributories or shareholders and creditors of the company in liquidation. The official liquidator has also opposed the sanctioning of the scheme of compromise/arrangement.