Patna High Court
Arun Kumar Agarwala And Ors vs The Union Of India on 27 September, 2023
Author: Satyavrat Verma
Bench: Satyavrat Verma
IN THE HIGH COURT OF JUDICATURE AT PATNA
CRIMINAL MISCELLANEOUS No.2804 of 2019
Arising Out of PS. Case No.-64 Year-2011 Thana- GOVERNMENT OFFICIAL COMP.
District- Patna
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1. Arun Kumar Agarwala S/o Ram Niwas Agarwala
2. Binod Kumar Agarwala S/o Bishwanath Agarwala
3. Shiv kumar Agarwala S/o Bhagwan Das Agarwala
All Directors of Company namely Satyam Ferro Tech Limited Liquidated
now Merged in Shivam Iron And Steel Company Ltd. Having it's registered
at 20 B, Abdul Hamid Street, 7th Floor, Kolkata, West Bengal.-700069.
... ... Petitioner/s
Versus
THE UNION OF INDIA Through the Registrar of Companies Bihar and
Jharkhand having its office at Maurya Lok Complex, 4th floor, A Block, Dak
Bunglow Road, Patna. - 800001
... ... Opposite Party/s
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Appearance :
For the Petitioner/s : Mr. Gautam Kumar Kejriwal, Adv.
Mr. Atal Bihari Pandey, Adv.
Mr. Alok Kumar Jha, Adv.
Mr. Mukund Kumar, Adv.
For the Opposite Party/s : Mr. A.B. Mathur, Adv.
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CORAM: HONOURABLE MR. JUSTICE SATYAVRAT VERMA
ORAL JUDGMENT
Date : 27-09-2023
Heard learned counsel for the petitioners and
learned counsel appearing for the Union of India.
2. The present application has been filed seeking
quashing of the order dated 27.04.2011 in Complaint Case No.
64(C) of 2011 passed by the learned Special Court, Economic
Offences, Patna whereby cognizance has been taken of the
offences under Sections 220 (3) and 162(1) of the Companies
Patna High Court CR. MISC. No.2804 of 2019 dt.27-09-2023
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Act, 1956 against the petitioners.
3. Learned counsel for the petitioners submits that
from submissions made hereinafter, it would manifest that the
said complaint case was instituted maliciously by the Registrar
of the Companies. It is next submitted that the Registrar despite
being aware of the entire fact that the Company in question had
already merged with another Company which had sanction of
the Hon'ble Jharkhand High Court, still proceeded to institute
the present complaint. It is further submitted that opposite party
filed a complaint against the petitioners before the learned
Special Court, Economic Offences, Patna under Sections 220(3)
and 162(1) of the Companies Act, 1956, alleging therein that the
petitioners have not filed the balance sheet and profit and loss
account of the Company for the year 2009-2010 before the
office of the Registrar of the Companies, Bihar and Jharkhand,
Patna. It is also submitted that in pursuance of the aforesaid
complaint, cognizance came to be taken. It is next submitted
that the Company in question in the present complaint is M/s
Satyam Ferro Tech Limited bearing Registration No. 03-9902
having its registered office at Giridih, Jharkhand. It is further
submitted that petitioners are also Directors of one another
Company, namely, Shivam Iron and Steel Company Limited
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having its registered office at Kolkata, West Bengal. It is further
submitted that the accused Company was not operative for last
several years and thus the petitioners felt the need of merging
the accused Company with the Company, namely, Shivam Iron
and Steel Company Limited. It is further submitted that after
observing all the formalities a company petition under the
Companies Act, 1956 being Company Petition No. 03 of 2008
was filed before the Hon'ble Jharkhand High Court at Ranchi
under Sections 391(1) and 394 of the Companies Act, 1956. It is
next submitted that the complainant was also furnished a copy
of the said Company petition filed before the Hon'ble Jharkhand
High Court in connection with amalgamation of the accused
Company with Shivam Iron and Steel Company Limited vide
letter dated 05.02.2009, as would be evident from Annexure-2 to
this application. It is also submitted that the complainant also
gave his no objection to the dissolution of the accused Company
in course of its merger with Shivam Iron and Steel Company
Limited, thereafter, the Hon'ble Jharkhand High Court vide
order dated 28.08.2009 allowed the Company Petition No. 03 of
2008 and sanctioned the scheme of merger w.e.f. 01.04.2007.
4. Learned counsel for the petitioners submits that
in view of the facts recorded hereinabove it becomes clear that
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the complaint petition itself was baseless and misconceived for
the reason that the accused Company had the sanction of the
Hon'ble Jharkhand High Court to be merged with Shivam Iron
and Steel Company Limited after no objection was given by the
complainant, further, the order by the Hon'ble Jharkhand High
Court dated 28.08.2009 was also passed in presence of the
complainant.
5. Learned counsel for the petitioners submits that
Section 581 ZN(11) of the Companies Act provides that once
the assets and liabilities of a company are transferred in
accordance with the provisions of sub-section (9) or where there
is merger under sub-section (2) of the registration of the
merging company would stand cancelled and that the company
shall be deemed to have been dissolved and cease to exist
forthwith, as such, what is not disputed rather stands admitted is
that the accused Company cease to exist from the date of the
order dated 28.08.2009 passed by the Hon'ble Jharkhand High
Court in Company Petition No. 03 of 2008 and the merger was
approved w.e.f. 01.04.2007, as such, the actual effect of such
order would be the cessation of the existence of the accused
Company w.e.f. 01.04.2007 itself as such there was absolutely
no obligation on part of the Director of the accused Company to
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file annual return, balance sheet and profit and loss account with
the opposite party i.e. the complainant for the financial year
ending on 31.03.2010.
6. Learned counsel for the petitioners further
submits that the complainant had also issued notice dated
11.03.2010upon the petitioners seeking explanation regarding non-compliance of the requirements of Sections 159, 160, 166, 210 and 220 (3) of the Companies Act, 1956. The said notice was responded by the petitioner by letter dated 13.03.2010 (Annexure-4 to this application) wherein it was made clear that in pursuance of the order dated 28.08.2009 the accused Company had already merged with the aforesaid Company w.e.f. 01.04.2007 and accordingly, a declaration to that effect was already filed vide Form No. 21 on 23.09.2009. It was also made clear that on account of merger the balance sheet and profit and loss account for the year ending 31.03.2009 also stood merged and was, accordingly, filed in the office of the complainant but the complainant took no steps against the petitioners for the financial year ending 31.03.2009 i.e. financial year 2008-09.
7. Learned counsel for the petitioners further submits that Shivam Iron and Steel Company Limited for the Patna High Court CR. MISC. No.2804 of 2019 dt.27-09-2023 6/7 financial year ending on 31.03.2010 has already filed the annual returns, balance sheet and profit and loss account after the accused Company merged with the aforesaid Company. Learned counsel for the petitioner thus submits that the complaint itself was misconceived and the cognizance came to be taken in a mechanical manner.
8. Learned counsel appearing for the Union of India is not in a position to rebut the factual submissions made by the learned counsel for the petitioners.
9. In view of the submissions recorded hereinabove and the fact that the accused Company had already merged with Shivam Iron and Steel Company Limited as aforesaid and thus ceased to exist w.e.f. 01.04.2007 or at least from the date of order of the Hon'ble Jharkhand High Court in Company Petition No. 03 of 2008, there was absolutely no liability of the accused Company to file its return in terms of Section 220 (3) of the Companies Act, 1956. Thus, the order dated 27.04.2011 in Complaint Case No. 64(C) of 2011 passed by the learned Special Court, Economic Offences, Patna whereby cognizance has been taken of the offences under Sections 220 and 162(1) of the Companies Act, 1956 against the petitioners is hereby quashed.
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10. Accordingly, this application is allowed.
(Satyavrat Verma, J) amit/-
AFR/NAFR N.A. CAV DATE N.A. Uploading Date 27.09.2023 Transmission Date 27.09.2023