Karnataka High Court
Venkata Kreshna Rao Gedla vs Union Of India on 24 July, 2019
Author: Alok Aradhe
Bench: Alok Aradhe
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 24TH DAY OF JULY, 2019
BEFORE
THE HON'BLE MR. JUSTICE ALOK ARADHE
WRIT PETITION NO.28558 OF 2019 (GM-RES)
BETWEEN:
Venkata Kreshna Rao Gedla
Son of Mr. Venkateswararao
Aged 53 years
Residing at Plot No.114
2nd East Street
Balaji Avenue, Thatchanallur
Tirunelveli
Tamil Nadu - 627 358. ... Petitioner
(By Sri Uday Shankar R.M, Advocate)
AND:
1. Union of India
Represented by its Under Secretary
Ministry of Corporate Affairs
Shastri Bhawan
Dr.Rajendra Prasad Road
New Delhi - 110 001.
2. The Registrar of Companies, Karnataka
Kendriya Sadan
II Block, Koramangala
Bengaluru - 560 034. ... Respondents
(By Sri Mallan Goud H, CGC)
---
2
This Writ Petition is filed under Article 226 of
the Constitution of India praying to declare that the
Section 164(2)(a) of the Companies Act, 2013 and
directions uploaded as per Annexure-A disqualifying
the petitioner qua directors of Private Limited
Company is unconstitutional, is in violation and in
contravention of the provisions of Part III of the
Constitution of India and etc.
This Petition coming on for Orders this day,
the court made the following:-
ORDER
Learned counsel for the parties jointly submit that the controversy involved in the instant petition is squarely covered by an order dated 12.06.2019 passed in W.P.No.52911/2017 and connected matters.
2. In view of the aforesaid submission and for the reasons assigned by a Bench of this Court in the aforesaid order, the writ petition is disposed of on same terms and with the following directions:
(i) Where the disqualification of the petitioner is based by taking into consideration any financial year "prior to 01.04.2014 as well as 3 subsequent thereto" while reckoning continuous period of three financial years under Section 164(2) (a) of the Act, irrespective of whether the petitioner is director of public companies or private companies, such a disqualification being bad in law, the Writ petition is allowed and the impugned list is quashed to that extent only;
(ii) If the disqualification of the petitioner is based by taking into consideration any financial year prior to 01.04.2014 only i.e., the disqualification has occurred under the provisions of the 1956 Act in respect of the public companies, the writ petition is dismissed.
(iii) If the disqualification of the director is based by taking into consideration of three continuous financial years subsequent to 01.04.2014, irrespective of whether the petitioner is a 4 director of public companies or private companies, he stand disqualified under the Act;
(iv) Where the disqualification of the director is based by taking into consideration any financial year prior to 01.04.2014 in respect of private companies, such disqualification being bad in law, the writ petition is allowed to the aforesaid extent only;
(v) The writ petition, wherein the challenge is also made to the vires of Section 164(2)(a), and/or 167(1)(a) and/or proviso to Section 167(1)(a) of the Act, are dismissed to the aforesaid extent;
(vi) The respondents are directed to restore the DIN of the director whose disqualification has been quashed by this Court;
(vii) The petitioner who has challenged only the striking off of the companies in which he is a 5 director have an alternative remedy of filing a proceeding before National Company Law Tribunal (NCLT) under Section 252 of the Companies Act, 2013, which provides for an appeal to be filed within a period of three years from the date of passing of the order dissolving the company under Section 248 of the Act. Hence, the writ petition is dismissed reserving liberty to the petitioner who is aggrieved by the dissolution of the companies under Section 248 of the Act (struck off companies) to approach NCLT, if so advised;
(viii) Parties to bear their own costs.
Accordingly, the writ petition is disposed of.
Sd/-
JUDGE PYR