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1960 (8) TMI 24 - SC - Companies LawWhether or not the first respondent has jurisdiction to exercise the powers under the relevant provisions of the new Act 1956? Whether the relevant provisions of section 240, which empower respondent No. 1 to issue the relevant notices by which the appellant was called upon to give evidence and to produce documents, offend against the fundamental constitutional right guaranteed by article 20(3)? Held that:- High Court was right in coming to the conclusion that the inspector appointed under section 138(4) of the old Act must by the legal fiction, which is authorised by section 645, be deemed to have been appointed under section 235 of the new Act, and if that is so, respondent No. 1 had authority and power to issue the impugned notices under section 240 of the new Act. The challenge to the validity of the impugned notices on the ground that respondent No. 1 had no authority to issue the said notices must, therefore, fail. Our conclusion, therefore, is that section 240 does not offend against article 20(3) of the Constitution. If the relevant provisions of the Act dealing with enquiries and investigations of the affairs of the companies are considered from this point of view there would be no difficulty in holding that article 14 is not violated either by section 239 or section 240 of the new Act. The result is the appeal fails and is dismissed with costs.
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