Kerala High Court
A.L. Verghese S/O Lonapoan vs Registrar Of Companies, Kerala on 2 June, 1995
Equivalent citations: AIR1996KER120, AIR 1996 KERALA 120
JUDGMENT P.A. Mohammed, J.
1. A company by name "St. Antony's High School Samudayam Limited" incorporated under the provisions of the Companies Act, 1956 on 3-1-1990. The copy of the Certificate of Incorporation granted to the company is Ext. P1. The main object of the company is to give financial assistance to manage schools and other educational institutions. Another object of the company is to carry on the business of conducting kuries (chitties) and advancing loans and to accept deposits subject to the provisions of Section 58-A of the Companies Act. The petitioners allege that the main object of the company was not introduced or implemented whereas the company had engaged in conducting kuries and daily financial matters. The petitioners further allege that St. Antony's High School had no connection whatsoever with the company and the name of the St. Antony's High School was used by the promoters in order to deceive the people and clandestinely to obtain subscribers to the chitty giving a false impression to the public that the company (St. Antony's High School Samudayam Limited) is a branch or extension of the St. Antony's High School itself.
2. The 1st petitioner is an old student of the St. Antony's High School and 2nd petitioner is a member of its Parent Teachers Association. The 3rd petitioner is also an old student of the school and a subscriber to the chitty transactions conducted by the company. In asmuchas the petitioners have aggrieved by the use of name of St. Antony's High School, they filed representations before the Registrar of Companies. Ext. P3 is the copy of the representation filed by the Vicar of the St. Antony's Church and two trustees. Ext. P10 is the representation filed before the Registrar of Companies by an old student of the school. Ext. P4 is the order passed by the Registrar of Companies on Ext. P3. Ext. P4 is mainly challenged in this writ petition.
3. The 1st respondent, Registrar of Companies had observed in Ext. P4 that the name of the St. Antony's High School Samudayam Limited had been allowed to the company as it was not found undesirable under the provisions of the Companies Act, 1956 or under the guidelines issued by the Department in this behalf. Therefore, the 1st respondent expressed his inability to take any further action against the company for the continued use of the name 'St. Antony's High School Samudayam Limited'. These observations of the 1st respondent is seriously challenged by the writ petitioners in this case.
4. Sub-section (1) of Section 20 mandates that no company shall be registered by a name which, in the opinion of the Central Government, is undesirable. Counsel for the petitioners maintains that the duty imposed on the 1st respondent has not been properly performed in this case and hence he may be directed to perform the said duty afresh judiciously by invoking the power of the Court under Article 226. The respondents 3 and 4 on the other hand, in their counter-affidavit maintained that this Court has no power to issue any such direction since no writ petition is maintainable against 3rd respondent which is a company registered under the provisions of the Companies Act. The petitioners submit that the function of the 1st respondent in this case involves the exercise of public duty and hence impugned order is amenable to the judicial review. It is pointed out by the petitioners that the relief in this case is mainly directed against the Registrar of Companies. The respondents 3 and 4 are only beneficiaries and in case the impugned order is set aside the benefit conferred on them would be obliterated. However, all the actions of respondents 3 and 4 are also under challenge in asmuchas the company has already been registered and started functioning and, therefore, it cannot be said that the relief claimed is solely against the 1st respondent.
5. The Supreme Court in Shri Anadi Mukta Sadguru Shree Muktajee Vandasijiswami Suvarna Jayanti Mahotsav Smarak Trust v. V. R. Rudani (AIR 1989 SC 1607) observed:
"Article 226 confers power on the High Courts to issue writs for enforcement of the fundamental rights as well as non-fundamental rights. The words "any person or authority" used in Article 226 are, therefore, not to be confined only to statutory authorities and instrumentalities of the State. They may cover any other person or body performing public duty. The form of the body concerned is not very much relevant. What is relevant is the nature of the duty imposed on the body. The duty must be judged in the light of positive obligation owed by the person or authority to the affected party." This would mean that the exercise of power under Article 226 is dependent on the nature of the duty imposed on the body whose infraction of duty is questioned. The body need not be a public body but duty conferred on it must be a public duty. "The judicial control over the fast expanding maze of bodies affecting the rights of the people should not be put into watertight compartment. It should remain flexible to meet the requirements of variable circumstances." This is what the Supreme Court ultimately laid down in Shri Anadi Mukta Sadguru's case (supra). This decision was relied on by the Bombay High Court in Mrs. Sejal Rikeeh Dalai v. Stock Exchange, Bombay ((1990) 69 Com Cas 709) for holding that Stock Exchange, Bombay recognized under the Securities Contracts (Regulation) Act, 1956 can be considered amenable to the jurisdiction of the High Court under Article 226 of the Constitution.
6. Lord Diplock said in Council of Civil Service Unions v. Minister for the Civil Service ((1985) AC 374 at 408) that "The subject-matter of every judicial review is a decision made by some person (or body of persons) whom I will call the "decision-maker" or else a refusal by him to make a decision.......To qualify as a subject for judicial review the decision must have consequences which affect some person (or body of persons) other than the decision-maker, although it may affect him too. It must affect such other person either." In Regina v. Panel on Take-Overs and Mergers, Ex parte Datafin Plc. ((1987) QB 815) the body which exercised the power is an unincorporated association in the City of London which monitors a code of rules, promulgated by itself, governing company take-overs and mergers. "It has neither statutory nor contractual powers, nor is it govermental in character. But it wields 'immense power de facto', since violations of the code, adjudged by itself, may lead to exclusion from the.
stock exchange or investigation by the Department of Trade and Industry or other sanctions." (See Administrative Law --H.W.R. Wade). While analysing the above decision Wade says "In the case of the takeover panel the function was, as a matter of law, entirely outside the machinery of Government, though the Court emphasised that, as a matter of fact, the panel performed an important public duty and the Secretary of State deliberately used it 'as the center piece of his regulation of that market'. "Thus, the character of the body, nature of the duty, involvement of affected persons (body of persons), the excessiveness of the power force etc. are the determinative factors in the field of exercising judicial review by the Courts.
7. The counsel for the petitioners have placed reliance in Methodist Church v. Union of India (1985 (57) Com Cas 443) was cited. Of course, in the said decision the High Court of Bombay allowed the writ petition by granting the relief sought for. There it was held that where the company already in existence with a certain name, had become defunct and the name with which it was registered was also of misleading character, the consent of such a company was not necessary for approving the name of a new company which is the true representative of the Methodist Chruch movement in India and which had necessarily to register itself under the name. It has to be observed in this connection that the maintainability of the writ petition was never an issue in the above case. As discussed hereinbefore while considering the maintainability of a writ petition it is essential to have an enquiry on the determinative factors in the field of exercising judicial review. However, I need not go into such an enquiry in this case and thus decide the maintainability of the writ petition for the reasons stated in the paragraphs below.
8. As against the grant of name 'St. Antony's High School Samudayam Limited' to the company, one student and his father together filed M. C. Application 131 of 1990 before this Court. The applicants there alleged that the company assumed the name St. Antony's High School Samudayam Limited with the deliberate intention of misleading the public that it was incorporated at the instance of St. Antony's Church and St. Antony's High School. In that application, the 3rd respondent-company raised a preliminary objection that the application was not maintainable. After considering the matter, this Court had observed "unless a particular matter is specified in the Companies Act to be dealt with by the Company Court, it cannot exercise jurisdiction merely because it is also a matter which relates to a Company." This Court further said "the jurisdiction of the ordinary Civil Court can be regarded as ousted in respect of only those matters" which are specified in the Companies Act or Rules to be dealt with by the Company Court. The reliance was placed by this Court on the following decisions : (1) Sree Krishna Jute Mills v. Krishna Rao (AIR 1947 Mad 322; (2) Star Tile Works v. N. Govindan (AIR 1959 Ker 254); (3) R. Prakasam v. Sree Narayana Dharma Paripalana Yogam (1980 (50) Com Cas 611) and (4) Rajendra Menon v. Cochin Stock Exchange Limited (1990 (1) KLT 283). However, in K. G. K. Compressors Ltd. v. K. E. Ltd. (AIR 1986 Delhi 181) it was held that the jurisdiction of the Central Government under Sections 20 and 22 of the Act and the jurisdiction of the Civil Court operate in two different fields.
9. The counsel for the respondents 3 and 4 has brought to my notice that the grievance projected in this writ petition was the subject matter of the dispute in O.S. No. 1816/90 on the Principal Munsiff's Court, Thrissur. The 1st plaintiff in that suit is the Vicar of the Church and 2nd plaintiff is the School. These two persons are actually aggrieved by the grant of name 'St. Antony's High School Samudayam Limited' to the company. The said suit was disposed of by the Munsiffs Court on 5th November, 1993. The operative portion of the judgment is thus : "A decree of prohibitory injunction is granted in favour of the plaintiffs restraining defendants 1 to 7 from publishing any written material for the purpose of starting and conducting kuries without making clarification in prominent letters that the 7th defendant-company has got no relationship or connection whatsoever with the St. Antony's Church and the St. Antony's High School at Ammadam". The respondents 3 and 4 maintain that the above judgment has become final and conclusive and as long as the said judgment stands no relief can be granted by this Court in the present proceeding. I see some considerable force in this submission. As pointed out above, the aggrieved persons in the present transaction are the plaintiffs in the suit and their grievance has practically been redressed by the aforesaid judgment. That being so, the question whether a writ petition can be maintained at the instance of the petitioners in the nature of the dispute raised in this writ petition need not be decided in the present proceeding. That question is left open.
In the result, the Original Petition is dismissed.