TMI Blog2019 (12) TMI 1431X X X X Extracts X X X X X X X X Extracts X X X X ..... a director, diligently and meticulously following every provision of law, is certainly disproportionate to the lapse, as it is only regulatory in nature, because, notice to be sent under section 248(1) of the Companies Act, 2013 by the Registrar of Companies for striking off the name of the company from the Registrar of Companies on the premise that the company has not been carrying on any business for a period of two financial years, is different from the disqualification under section 164(2)(a), inasmuch as a company can be struck off, if the company has not been carrying on any business for a period of two financial years, whereas for disqualification, the criteria is three financial years. H ence, Section 164(2)(a) is read down to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17 and 1-11-2017 published by the Registrar of Companies, Tamil Nadu, Chennai were the subject matter of challenge before this Court in a batch of cases in W.P. No. 25455 of 2017 etc. batch [(2018) 6 MLJ 704] and came to be disposed by this Court by order dated 3-8-2018, the operative portion of which is extracted below:- 29. In fine, (a) When the New Act 2013 came into effect from 1-4-2014, the second respondent herein has wrongly given retrospective effect and erroneously disqualified the petitioner-directors from 1-11-2016 itself before the deadline commenced wrongly fixing the first financial year from 1-4-2013 to 31-3-2014. (b) By virtue of the new Section 164(2)(a) of the 2013 Act using the expression for any continuous per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial years. Importantly, it is to be borne in mind that even beyond that time limit, additional time limit of 270 days was available by virtue of the then first proviso to Section 403. (d) Although there is no statute or provision expressly spelling out the observance of the principles of natural justice against disqualification of directors, as the legal right of the petitioners to continue as director in other company or to be reappointed in any other company, which are scrupulously following the provisions of the Companies Act, have been deprived of, the principles of natural justice should have been adhered to by issuing proper notice to all the directors. (e) When the disqualification clause was not attracted to the directors of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nature, because, notice to be sent under section 248(1) of the Companies Act, 2013 by the Registrar of Companies for striking off the name of the company from the Registrar of Companies on the premise that the company has not been carrying on any business for a period of two financial years, is different from the disqualification under section 164(2)(a), inasmuch as a company can be struck off, if the company has not been carrying on any business for a period of two financial years, whereas for disqualification, the criteria is three financial years. Therefore, in my considered opinion, although the petitioners have not challenged the provision of Section 164(2)(a), as the respondents have not followed the principles of natural justice, ext ..... X X X X Extracts X X X X X X X X Extracts X X X X
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