Bsl Limited vs Board Of Revenue, Ajmer & Ors on 15 September, 2016

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Rajasthan High Court - Jodhpur

Bsl Limited vs Board Of Revenue, Ajmer & Ors on 15 September, 2016

1. By way of this writ petition, the petitioner has questioned the legality of order dated 2.7.13 of the Board of Revenue, Rajasthan, whereby while accepting the reference made by the Additional Collector, Bhilwara, under Section 82 of the Rajasthan Land Revenue Act, 1956 (for short "the Act"), the mutation of the land in question effected in the name of the petitioner BSL Limited has been cancelled and the original mutation made in the name of the Company M/s Bhilwara Synthetics Limited, Bhilwara, has been restored. That apart, the petitioner has also sought directions to the third respondent-Collector (Industries), Bhilwara, to execute supplementary lease deed capturing the new name of the petitioner Company i.e. BSL Limited, in place of Bhilwara Synthetics Limited.

2. The facts relevant are that a lease deed of the land measuring 9 bighas 15 biswas, comprising CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 3 Khasra No.1145, 1147, 1148, situated at Village-Bilia Kalan and the land measuring 5 bighas 15 biswas comprising Khasra No.337 & 339, situated at Village- Gunwardi, total 15 bighas and 10 biswas, to be used for industrial purposes, was executed by the Collector, Bhilwara, in favour of the Company M/s Bhilwara Synthetics Limited on 30.5.84. The Board of Directors of Company M/s Bhilwara Synthetics Limited resolved to change the name of the Company to BSL Limited. The Registrar of the Companies approved the name change and issued fresh "Certificate of Incorporation" consequent on change of name, on 19.7.94, after obtaining requisite consent from the Government of India, as required under Section 21 of the Companies Act, 1956. On the application being made by the petitioner Company, Naib Tehsildar, Hamirgarh, vide order dated 26.10.94, sanctioned the mutation of the land in favour of the petitioner Company.

CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 4

3. The petitioner also made an application to the District Industries Centre for ratifying the change of the name of the Company. In response to the application made vide communication dated 12.9.96, sent by the District Industries Officer, Bhilwara, the petitioner was directed to obtain NOC from concerned financial institution, which was produced by the petitioner vide covering letter dated 12.10.96.

4. At this stage, the Tehsildar, Bhilwara, made an application to the Additional Collector, Bhilwara to make a reference under Section 82 of the Act for cancellation of the mutation effected in the name of the petitioner Company on the ground that no lease of the land in question has been executed by the State in favour of the petitioner BSL Limited and it continues in the name of Bhilwara Synthetics Limited and therefore, the mutation sanctioned is illegal. The Additional Collector made the reference to the Board of Revenue as prayed for by Tehsildar, Bhilwara.

CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 5

5. The Board of Revenue vide order impugned dated 2.7.13 has cancelled the mutation effected in the name of the petitioner Company holding that without the lease deed being amended by the Collector (Industries) incorporating the change of name of the Company, the mutation effected is contrary to law. Hence, this petition.

6. Learned counsel appearing for the petitioner contended that the Board of Revenue has seriously erred in holding that mutation entered in the Revenue Record pursuant to change of name of the petitioner Company without execution of a supplementary lease deed consequent upon such change, is contrary to law. Learned counsel submitted that it is not in dispute that the petitioner Company had only undergone a change in name for which there is no statutory or regulatory mandate to obtain prior permission from the Allotting Authority. Learned counsel submitted that after the change of CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 6 name of the Company, the petitioner BSL Limited has been depositing lease money in the name of BSL Limited, which has been accepted by the respondents throughout and thus, as a matter of fact, the change of the name of the petitioner Company has been consented impliedly. Learned counsel submitted that the change of name of the Company having been approved by the Registrar of Companies after obtaining requisite consent from Government of India as required under Section 21 of the Companies Act, 1956, for all intent and purposes, the name of the Company stands changed and therefore, neither the Collector is empowered to refuse incorporation of the changed name of the Company by executing a supplementary lease deed nor the Revenue Authority concerned can refuse to sanction the mutation of the land in the changed name of the Company.

7. On the other hand, Mr.N.S.Rajpurohit, learned CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 7 Additional Government Counsel appearing for the respondents submitted that the petitioner has changed the name of the Company without permission of the Allotting Authority, however, on being asked by the court to point out the provision of the Rajasthan Land Revenue (Industrial Areas Allotment) Rules, 1959 (for short "the Rules"), providing for the requirement of such prior permission of the Allotting Authority before the change of the name of the Company, the learned Additional Government Counsel had no answer. However, learned Additional Government Counsel submitted that the petitioner unit was asked to give an undertaking that after acceptance of the change of name, the petitioner Company will execute supplementary lease deed and get it registered but the petitioner Company failed to do so and therefore, the action of the respondents in not approving the change of the name of the Company by executing a CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 8 supplementary lease deed, cannot be faulted with.

8. Mr.O.P.Boob, learned Government Counsel submitted that in absence of supplementary lease deed being executed by the Collector in favour of the petitioner Company, the mutation sanctioned in its favour was ex facie contrary to the relevant provisions of the Rajasthan Land Revenue Act,1956 and the Rules made thereunder, and therefore, the Board of Revenue has committed no error in cancelling the mutation effected while accepting the reference made by the Additional District Collector.

9. I have considered the rival submissions and perused the material on record.

10. Indisputably, the land in question was allotted to the Company M/s. Bhilwara Synthetics Limited under the provisions of the Rules and accordingly, a lease deed was executed on 30.5.84. As per Rule 9 of the Rules, the lessee have limited ownership on the land leased till the lease subsists and have right CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 9 of assignment only for the purpose of taking a loan for the development of the industry or for pledging as collateral security for loan taken by the lessee or some other industry owned by the same management. But then, as per proviso (ii) to Rule 9, once the land has been utilised for the purpose for which it was allotted for the period specified in Rule 7, the lessee may with the permission of the Allotting Authority transfer his right or interest in whole land so leased out, the condition of the lease remaining unchanged. Thus, undoubtedly, if the lessee intends to transfer his right or interest in the leased land in favour of anybody else, the permission of the Allotting Authority is condition precedent. But there is no provision under the Rules providing for the requirement of prior permission of the Allotting Authority before the change of the name of the Company without involvement of the transfer of right or interest in the land leased out. Admittedly, in the CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 10 instant case, the lessee Company M/s. Bhilwara Synthetics Limited has not transferred its right or interest in the land allotted rather, the name of the lessee Company has changed from M/s. Bhilwara Synthetics Limited to BSL Limited. Thus, in absence of any provision under the Rules providing for the permission of the Allotting Authority before the change of the name of the Company, the action of the Collector (Industries) in not executing the supplementary lease deed incorporating the change of the name of the Company is ex facie contrary to the Rules.

11. It is pertinent to note that the change of the name of the Company is regulated by the provisions of Section 21 of the Companies Act, 1956. It has come on record that the Company M/s. Bhilwara Synthetics Limited by a special resolution adopted in the meeting of the Board of Directors of the Company and with the approval of the Central CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 11 Government in writing, changed its name from M/s. Bhilwara Synthetics Limited to BSL Limited in terms of provisions of 21(f) of the Companies Act, 1956 and consequent upon the change of name, fresh 'certificate of incorporation' was issued by the Registrar of Companies on 19.7.94 pursuant to Section 23 of the Companies Act, 1956. It is also relevant to mention here that by virtue of provisions of sub-section (3) of Section 23, the change of the name of the Company does not affect any rights or obligations of the Company or render defective any legal proceedings by or against it and any legal proceedings which might have been continued or commenced by or against the Company by its former name may be continued by or against the Company by its new name. Thus, ignoring the certificate of incorporation issued by the Registrar of Companies certifying the change of the name of the Company, the action of the respondents in refusing to amend CIVIL WRIT (CW) No.13701 of 2013 BSL Limited vs. Board of Revenue Ajmer & Ors. 12 the lease deed or to execute the supplementary lease deed so as to incorporate the change of name of the Company, is ex facie illegal, arbitrary and unjustified.

12. In the result, the petition succeeds, it is hereby allowed. The Collector (Industries) is directed to execute the supplementary lease deed incorporating the changed name of the petitioner Company i.e. BSL Limited in accordance with law, expeditiously in any case, within a period of one month from the date of receipt of certified copy of this order. Consequent upon the supplementary lease deed being executed in favour of the petitioner, the mutation of the land effected in the name of the petitioner BSL Limited, cancelled by the Board of Revenue shall be restored by the authority concerned forthwith. No order as to costs.

(SANGEET LODHA),J.

Aditya/

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Rajasthan High Court - Jodhpur