TMI Blog2015 (5) TMI 1243X X X X Extracts X X X X X X X X Extracts X X X X ..... areholders with that of the company, which can be done on certain exceptional circumstances. This dispute does not require lifting of corporate veil - there are no demand for transfer fee can be raised on the petitioner company as a condition precedent for recordal of its name as a lessee, on the ground that there has been transfer of leasehold right. The licence of the petitioner company cannot be withheld under the 2000 Order also for this reason. The authorities are directed to record the name of the petitioner company as a lessee on compliance of all other relevant formalities, if any, in respect of the subject plot and also grant the petitioner company licence in terms of the 2000 Order if the petitioner company is otherwise eligible for such licence - application disposed off. - W.P. Nos. 24788 (W) of 2010 and 26049 (W) of 2014 - - - Dated:- 5-5-2015 - Aniruddha Bose, J. For the Appellant : Moloy Kumar Basu, Senior Advocate, Atish Ghosh and A. Chandra. For the Respondents : Susovan Sengupta and Subir Pal. JUDGMENT Aniruddha Bose, J. 1. These two writ petitions, though arising from two different causes of action, essentially involve a common qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government of West Bengal (hereinafter referred to as the GOVERNMENT ), (5) Not to sub-divide the demised plot of land, (6) Not to assign underlet or part with the possession of the demised premises or any part thereof without first obtaining the written consent of the Lessor such consent however not to be unreasonably withheld in the case of a responsible person, (7) Not to mortgage or charge the lease-hold interest of the Lessee and the buildings to be erected thereon without the previous consent in writing of the Government such consent not being unreasonably withheld in the case of bona-fide necessity. 4. The said unit, with the land and structure thereon was transferred to Dabur India Limited on 7th May, 1996 by the original lessee, Pfizer Ltd. By a communication bearing No. 2055/D-35 dated 29th September, 2014, Dabur India Ltd. was informed by the Estate Manager, Kalyani, Urban Development department of the State Government that leasehold interest of the said plot was recorded in its name. Mutation was thus effected in the name of Dabur India Limited. Subsequently, through a process of demerger, the pharmaceutical business of Dabur India Limited was segregated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f different categories of land in Kalyani Township were under active consideration of Govt. for sometime past. After careful consideration of the matter the Governor has been pleased to decide that the salami for different categories of land and the fees for allowing transfer of different categories of land in Kalyani Township shall henceforth be charged in the following manner. The salami for leasing out different categories of plots of land in Kalyani Township shall be charged as follows: SL. No. Type of plot Rate per cottah (a) Commercial Rs. 73,000/- (b) Industrial Rs. 30,000/- (c) Residential i) Co-operative Plots- 3 cottahs or more Rs. 1,00,000/- ii) Individual Plot upto 3 cottahs Rs. 50,000/- iii) Individual plot) more than 3 cottahs but less than 5 cottahs Rs. 80,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd writ petition being W.P. No. 26049(W) of 2014 is an order of the District Magistrate and Collector, Nadia passed on 12th August, 2014 refusing to grant license in terms of the 2000 Order. The ground on which such license has been refused has been specified in the order of the District Magistrate passed on 12th August 2014 and the relevant part of the said order stipulates:- The change of name was caused when, by way of acquisition through a share purchase - agreement there occurred a transfer of majority of the equity shares from the original majority stakeholders i.e. Dabur Pharma, a subsidiary of the Dabur Group of companies to Fresenius Kabi (Singapore) Group. {EXHIBIT - 2: Para 1 of the Explanatory Statement u/s. 173(2) of the companies act; duly endorsed by the legal - Head of Dabur Pharma Ltd.}. The stake of the parent company having fallen grossly, there is, undoubtedly, a change of interest in the shareholding of the two groups of companies by way of acquisition and divestment of shares, and hence the transfer of leasehold rights in the name of Fresenius Kabi Ltd. was not possible by the Estate Manager, Kalyani, without payment of transfer fees. This, therefore, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both these proceedings, contention of the petitioners, represented by Mr. M.K. Basu, learned senior advocate is that change of name of a company does not constitute transfer of assets of the company, or its leasehold right. Questioning the legality of the order of the District Magistrate, it has also been argued by Mr. Basu that the District Magistrate, while examining the application for licence under the 2000 Control Order acted beyond jurisdiction to raise the issue of transfer of leasehold right. In this regard, my attention was drawn by Mr. Basu to an order passed by an Hon'ble Division Bench in M.A.T. No. 310 of 2011 (with C.A.N. 2395 of 2011) on 9th March, 2011. In the first writ petition, on 10th February 2011 an Hon'ble Single Judge of this Court had issued directions for filing affidavits but declined to pass any interim order. The petitioners had appealed against that order. The Appellate Court, in the order passed on 9th March 2011 did not interfere with the directions issued by the Hon'ble Single Judge for filing affidavits, but had observed:- However, we are also of the opinion that pending disposal of the writ petition, respondent authorities herein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to warrant the inference that a shareholder, on investing money in the purchase of shares, becomes entitled to the assets of the company and has any share in the property of the company. A shareholder has got no interest in the property of the company though he has undoubtedly a right to participate in the profits if and when the company decides to divide them. The interest of a shareholder vis-a-vis the company was explained in the case of Chiranjitlal Chowdhuri v. The Union of India and Others [1950] S.C.R. 869, 904.). That judgment negatives the position taken up on behalf of the appellant that a shareholder has got a right in the property of the company. It is true that the shareholders of the company have the sole determining voice in administering the affairs of the company and are entitled, as provided by the Articles of Association to declare that dividends should be distributed out of the profits of the company to the shareholders but the interest of the shareholder either individually or collectively does not amount to more than a right to participate in the profits of the company. The company is a juristic person and is distinct from the shareholders. It is the compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by way of dividends amongst the shareholders. It was further held therein that he has further a right to participate in the assets of the company which would be left over after winding up but not in the assets as a whole. In the present case, it is nobody's case that the company was wound up and the assets of the wound up company which were left over after winding up of the said company was transferred by the promoter shareholder in favour of the stranger purchaser. As such, by following the aforesaid decision of the Hon'ble Supreme Court as well as of this Hon'ble Court, this Court has no hesitation to hold that with the transfer of the share by the promoter shareholder to the present shareholder, namely the transferees of such share, the lease hold interest of the company was not transferred from the promoter shareholder to the present shareholder of the said company. The petitioner-company which obtained the said lease from the Government, still remains the lessee of the said plot of land and its leasehold interest in the said plot of land remains unaffected by transfer of share by the promoter shareholders to the present holders. As such, this Court holds that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oceedings which might have been continued or commenced by or against the company by its former name may be continued by or against the company by its new name. This makes it abundantly clear that as the alteration is only in the name and not in the identity and that the statute itself grants the right to continue an existing proceeding by the old company in its new name. 13. In the case of W.H. Targett (India) Ltd. (supra), a Division Bench of this Court also considered the scope of Section 23 of the Companies Act, 1956 and in this case, it has been observed:- SECTION 23 of the Companies Act, 1956, enumerates the effect of the change of name by a company. Sub-section (3) of Section 23 of the said act contemplates that the change of name shall not affect any rights or obligations of the company, or render defective any legal proceedings by or against it; and any legal proceedings, which might have been continued or commenced by or against the company by its former name may be continued by or against the company by its new name. 14. Mr. Sengupta on the other hand submitted that the result of transfer of the entire equity holding of the promoter group to another set of sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... name, the petitioner company would become liable to pay the transfer fee. The charging provision, if that expression is used, in terms of the said notification however is not recordal of change of name but transfer of leasehold rights. In the instant case the authorities are not seeking to demand transfer fee on the incidence of transfer of assets but on the application for recording change of name, which also is the main ground for withholding licence under the above referred Control Order. 17. This stand of the State I am unable to accept. I am not entering into the question in this writ petition as to whether the transfer of majority equity holding of a company would result in transfer of assets of the company or not because that is not the lis which has arisen in these two proceedings, though the State has referred to that dispute tangentially. On permitting recordal of Dabur Pharma Limited as the lessee on 15th March, 2005 the State had recognized independent juridical entity of Dabur Pharma Limited as a lessee. Subsequently, change of the promoter group, which eventually led to the change of corporate name, in my opinion, cannot saddle the petitioner company with an indep ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
