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TMI Blog2010 (8) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... in ultra vires the provisions of articles 14, 19(1)(g), 265 of the Constitution of India and sections 3(5), 560, 642 and regulation 75 of Table A to Schedule I of the Companies Act, 1956 insofar as the petitioner is concerned. 4. Heard Mr. Aravind P. Datar, senior counsel appearing for the petitioners and Mr. Haja Mohideen Gisthi, Senior Central Government Standing Counsel, for the respondents. 5. Learned senior counsel appearing for the petitioner would submit that the impugned circular was issued by the Government of India for simplification of procedure for removal of name of defunct companies and that the scheme itself was in operation only up to December 31, 2003 and therefore, the circular is no longer in force and no further adjudication is required in the said writ petition. There is no record placed before this court to show that the scheme continues to be in vogue or the period of its validity stood extended beyond December 31, 2003. In that view of the matter, Writ Petition No. 17120 of 2003 is dismissed as infructuous. 6. The facts which are necessary for the disposal of Writ Petition No. 2964 of 2003 are as follows : The first petitioner is a company, registered un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the second petitioner herein has no contact with any of the erstwhile directors and therefore, requested to treat the company as a defunct company under section 560 of the Companies Act. The petitioner did not receive any further communication thereafter. At that stage of the matter, the circular dated 25-3-2003 came to be issued introducing a scheme for removal of name of defunct companies. This scheme/circular was challenged by the petitioner by a separate writ petition in W. P. No. 17120 of 2003, which has been disposed of as stated above. In the above factual background, the petitioner has filed this writ petition to strike off the first petitioner-company from the register of the second respondent in terms of section 3(5) of the Act. 7. Learned senior counsel appearing for the petitioner would contend that the petitioner has been unnecessarily harassed and the provisions of section 3(5) are very clear and if the petitioner has not increased their share capital the company is deemed to have become defunct and therefore, the action of the second respondent in refusing to treat the petitioner-company as a defunct company is not tenable and was contrary to the statutory provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akes effect and the company shall be deemed to be a defunct company under section 560 of the Companies Act. 11. In my view by operation of law, the company is declared to become a defunct company and the Registrar is not required to go through the procedures contemplated under sub-sections (2) to (5) of section 560 of the Act. The Hon'ble Full Bench of the Allahabad High Court in Darbari Lal v. Smt. Dharam Wati AIR 1957 All. 541, while interpreting the term is deemed to have observed as under : "30. When a thing is 'deemed to be' something, the only meaning possible is that whereas it is not in reality that something, the Act directs that it should be treated as if it were that thing." (p. 545) 12. In terms of section 3(5) of the Act if the company is deemed to be a defunct company, the only meaning possible is that whereas it is not in reality to be a defunct company, but the Act directs that the company which has not increased its share capital to be a defunct company. 13. Hindustan Co-operative Housing Building Society Ltd. v. Registrar of Co-operative Societies [2009] 14 SCC 302, wherein the Hon'ble Supreme Court considered a deeming provision and held as follows : "9. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is meant) 'to extend the denotation of the defined term to things it would not in ordinary parlance denote, is often a convenient devise for reducing the verbiage of an enactment, but that does not mean that wherever it is used it has that effect; to deem means simply to judge or reach a conclusion about something, and the words "deem" and "deemed" when used in a statute thus simply state the effect or meaning which some matter or thing has the way in which it is to be adjudged ; this need not import artificiality or fiction; it may simply be the statement of an undisputable conclusion'. (Per Windener J. in Hunter Douglas Australia Pty. v. Perma Blinds [1970] 44 ALJ 257). 12. When a thing is to be 'deemed' something else, it is to be treated as that something else with the attendant consequences, but it is not that something else (Per Cave J., R. v. Norfolk County Court [1891] 60 LJ QB 379). 'When a statute gives a definition and then adds that certain things shall be "deemed" to be covered by the definition, it matters not whether without that addition the definition would have covered them or not'. (Per Lord President Cooper in Ferguson v. McMillan [1954] SLT 109.) 13. Wheth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r ending 31-3-1998 that the company has written back the loan from the State Bank of India amounting to Rs. 1,37,294 based on legal opinion that it is barred by limitation and all amount due to and due by the company have also been written off or written back as the same are barred by the law of limitation, but it does not explain how the cash and bank balances appearing in the books have also been brought to nil. Therefore, it appears that as on date, there are no other assets or liabilities of the company and it is not the case of the second respondent that during the pendency of the writ petition any claims/complaints were received against the first petitioner-company. Admittedly, the period of validity of the simplified exit scheme, has come to an end. 16. Thus as on date, the case of the first petitioner-company has to be decided on the available facts and taking note of the declaration made and the effect of section 3(5). It is not the case of the second respondent that the period of two years stipulated under the statute for increasing the paid-up capital could be extended. The period having come to an end in 2002 cannot be extended, unless the statute is appropriately amen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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