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2017 (7) TMI 2 - HC - Companies LawLicence revoked under Section 25(1) of the Companies Act, 1956 - breach of natural justice - Held that:- The impugned action of revocation of licence against the petitioner is in exercise of the aforesaid clause (b) of Section 25(8). The contention that in respect of exercise of powers under Section 25(8)(b), notice is not contemplated, plainly overlooks the position emerging from the two sub-sections where they both deal with revocation of licence. These provisions have conjoint and interactive reading. Though sub-section (7) and sub-section (8) are engrafted as separate and different sub-sections, projection of the both is for same purpose-which is for revocation of licence. Revocation of licence is contemplated under subsection (8)(b) if the licencee body contravenes provision of sub-section (8)(a) namely that it alters the provisions of its Memorandum with respect to its objects without prior permission of the Central Government. This being so, when sub-section (8)(b) also empowers the Central Government to revoke the licence, the requirement of notice and opportunity of being heard as per the Proviso to sub-section (7) has to also apply for an action under Section 25(8)(b) of the Act. Viewed from any standpoint in the context of requirement of complying with the natural justice and principles of audi alteram partem, the impugned order is unsustainable in law. Thus in applying and action upon the provision of Section 25(8)(b) of the Companies Act, 1956, principles of natural justice shall have to be read into the exercise of said powers. The impugned action of revocation of licence deserves to be set aside on the aforesaid ground alone without going into any other aspect.
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