TMI Blog2005 (8) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... -05 and fix their remuneration; ( iii )Election and balloting; ( iv )To announce the results of the election of the office bearers and committee members. 3. The said notice was issued by Hon ble Secretary on behalf of and under the authority of the Executive Committee of the said Club. On that very day, by a circular proposals/nominations were invited for election of the office bearers and Executive Committee members for the year 2004-05. Election officers were appointed under article 28( a ) of the election rules of the said club and the Executive Committee appointed Gobinda Prasad Agarwal and Ashoke Kumar Singhania as Hon ble Election Officers for conducting election. Nominations were required to reach at the office of the said club by 7 p.m. on 26-11-2004 and the last date of withdrawal was also fixed. On very that date, printed copy of annual accounts of the said club along with the auditor s report was circulated among the members of the said club. Clause 4( e ) stated that none of the committee members is disqualified as on 31-3-2004 from being appointed as committee members in terms of clause ( g ) of sub-section (1) of section 274 of the Companies Act, 1956 (hereina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... papers will not be issued and those candidates would be considered having duly elected. ( c ) If the number of candidates for the post of any office bearer or members of the committee exceed the number to be elected, then only the election shall be held by ballot, only for such posts for which the numbers so exceed." and submitted that under rule 5( a ) of the election rules, the election officer shall scrutinise the nominations received and a list of valid nominations will be displayed on the notice board of the club at least two weeks before the date of the annual general meeting. 9. He further contended that on 7-12-2004, some members of the said club drew attention of the president that mandatory provisions of section 274(1)( g ) of the said Act have not been complied with by ten candidates who had offered themselves for election as office bearers and executive committee members for the year 2004-05 and it was pointed out that the election officers had wrongly included their names in the list of valid nominations put up on the notice board on 26-11-2004. In view of the obvious printing error in the auditor s reports circulated by the club, an erratum to the annual repo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r appointment as a director or not. 9. Duty of every director. Every director in a public company registered under the Companies Act, 1956 shall file Form DD-4 , prescribed under these rules, before he is appointed or re-appointed." 11. According to him, if such procedure is accepted, in that case, while the members are casting their votes on the date of the annual general meeting would not know which particular candidate is eligible to be elected or has incurred a disqualification under the rules. According to him, it would lead to an anomalous situation where a candidate after being elected could subsequently be disqualified, if he is unable to furnish the declaration in Form DD-A as required under the rules. However, an elected candidate is found to be subsequently disqualified by reason of operation of section 274(1)( g ) of the said Act, then re-poll would have to be held to determine which candidate is to be elected in place and instead of the disqualified candidate. Filing of Form DD-A along with the nomination papers would ensure certainty and finality in the election results. 12. He further submitted that none of the plaintiffs though directors of other public ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e at 6, Old Post Office Street, Kolkata, within the jurisdiction of this court. 16. Mr. S.B. Mookherjee, learned Senior Advocate, appearing on behalf of the respondent/plaintiff submitted that it is admitted that on 29-11-2004 after scrutiny of 36 nominations the election officers hung up the names of the candidates whose names were found to be valid after scrutiny and hung up those names in the notice board on 29-11-2004. There was no infirmity or invalidity so far as the names of the plaintiffs/respondents are concerned. He further submitted that erratum which was issued by the auditor was not even considered at any meeting of the committee members nor was it placed at any meeting of the committee member which would be evident from a letter written by the 13 out of the 21 members regarding the said fact. 17. On 13-12-2004, all the plaintiffs/respondents filed the Form DD-A under section 274(1)( g ) of the said Act and obtained receipts for the same. This fact is not disputed [filing of such declaration forms was mentioned in paragraph 16( iii ) of the petition and admitted in paragraph 15 of the affidavit-in-opposition]. He further submitted that under section 211 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribed under these Rules, before he is appointed or reappointed." 19. The election rules of the club were framed long ago and, therefore, do not provide for filing of any declaration regarding compliance with section 274(1)( g ) of the said Act, nor do the rules fix any time for filing of such declaration forms. The election rules of the club cannot either curtail or enlarge the period fixed by the Act or statutory rules framed there- under which have statutory force. Rule 9 requires the forms to be filed before a candidate is appointed or reappointed and therefore, it cannot be contended that such declaration form is required to be filed along with the nominations. Nominations were purported to be rejected on 15-12-2004 on the alleged ground that the declarations were not filed along with the nominations. Mr. Mookherjee further contended that this is not the requirement of the Act and the rules, nor even it is the requirement under the election rules of the club. Therefore, such steps could not have been taken by them. He further contended that rejection of the nominations filed by the plaintiff/respondent herein are illegal and void which was stayed by an interim order d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been working as a director in a public company and which has made the following types of default incurs the disqualification. Now, let us see what are such types of default, which has been introduced by the said amendment. It appears that those are: ( a )failure in filing annual returns and annual accounts for any continuous period of three financial years; and ( b )failure in paying matured deposits or interest on deposits or failure to pay back debenture holders on due date of redemption or the declared dividend, and the default has continued for one year or more. 25. It further appears that under rule 9 it is the duty of every director in a public company registered under the Act, shall file Form DD-A pres-cribed under these rules before he is appointed or reappointed. In the instant case, it is admitted that on 13-12-2004 all the plaintiffs/respondents filed Form DD-A under section 274(1)( g ) of the said Act and obtained receipts for the same, which is not denied by the appellant. Therefore, it cannot be said, in our opinion, that there is any violation of any rule by the plaintiff in seeking election by filing their nominations for the post of office bearers or the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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