CIVIL WRIT PETITION NO. 3021 OF 2008 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. DATE OF DECISION: July 09, 2009. Parties Name Dr. Kartar Singh Rai ...PETITIONER VERSUS The Registrar of Companies and others ...RESPONDENTS CORAM: HON'BLE MR. JUSTICE JASBIR SINGH PRESENT: Mr. Sudhir Mittal, Advocate, for the petitioner. Mr. S.K.Sharma, Advocate, for respondent No. 1. Mr. Puneet Jindal, Advocate, for respondents No. 2 and 3. JASBIR SINGH, J. (oral) ORDER: This writ petition has been filed with a prayer that direction be issued to respondent No. 1 to declare respondent No. 2, i.e., M/S Punjab Motors Pvt. Ltd. as a defunct company, as per the provisions of Section 3 of the Companies Act, 1956, (in short the Act). It is averment of the petitioner that the Company is closed for the last so many years. Last monthly return by the Company was filed on March 31, 1984. It has further been stated that the Company does not have paid up capital of more than Rs. 1,00,000/-, as is mandatory under the aforesaid provision. By stating as above, it has been prayed that Registrar CIVIL WRIT PETITION NO. 3021 OF 2008 -2- of Companies (Respodent No. 1) be directed to take action under the provisions of Section 560 of the Act (in short the Act) against respondent No. 2. Prayer made by counsel for the petitioner has been opposed by respondents No. 2 and 3 by stating that the petitioner and respondent No. 3 are real brothers. Inter se litigation, regarding property left by their father Gian Singh, is pending in various Forums and this writ petition has been filed to settle personal property dispute. After hearing counsel for the parties, this Court is of the opinion that this writ petition deserves to be disposed of by issuing direction to respondent No. 1 to take action as per provisions of Section 560 of the Act. In this writ petition, in para No. 5, petitioner has averred as under: “That respondent No. 2 could not function profitably and hence the Directors resolved to wind it up. Accordingly, notice dated July 6, 1984 was issued for holding of 9th Annual General Meeting on July 31, 1984 at 11 AM. A true copy of this notice is annexed as Annexure P-5. In this meeting Directors report dated July 6, 1984, was placed before the house in which it was stated that efforts are being made to wind up the affairs of the Company to avoid further losses. A true copy of this report is annexed as Annexure P-6. Subsequently, the Board of Directors met on September 10, 1984 and formally decided to complete the winding up procedure. The copy of the minutes of this meeting is not available with the petitioner and this averment is being made on the basis of the notes maintained by him with regard to the affairs of respondent No. 2 after he was CIVIL WRIT PETITION NO. 3021 OF 2008 -3- inducted as its Director some time in the year 1981-82. The last annual return filed on behalf of respondent No. 2 was July 31, 1984, after which no further returns have been filed. At that particular point in time Sh. Charanjit Singh, respondent No. 3 was the Managing Director of Respondent No. 2” In reply to above said averment, respondent No. 1 in his reply has stated that contents of para No. 5 are matters of record. Counsel for respondents No. 2 and 3 has failed to rebut the averments made by the petitioner in para No. 5 of the petitioner. It has not been controverted that the Company do not have paid up capital of more than Rs. 1,00,000/-. It is not functioning for the last so many years and last return was filed in the year 1984. If that is so, this Court feels that respondent No. 1 is duty bound to take action as per provisions of Section 560 of the Act, which reads thus: “560(1) Where the Registrar has reasonable cause to believe that a Company is not carrying on business or in operation, he shall send to the company by post a letter inquiring whether the Company is carrying on business or in operation.” The above provision further mandates that on forming a reasonable belief that a Company was not carrying on business or is not in operation, the Registrar of Companies shall send a letter to the Company concerned and thereafter take action as provided in the above said provision. In view of admitted facts on record, as mentioned above, there is no reason with respondent No. 1 to say that action cannot be taken as per provisions of Section 3 of the Act. Consequently, this writ petition is CIVIL WRIT PETITION NO. 3021 OF 2008 -4- disposed of by directing respondent No. 1 to initiate action as per provisions of Section 3 of the Act and after observing the procedure laid down in Section 560 of the Act, pass a reasoned order declaring the Company as a defunct Company or otherwise. Needful be done within three months from the date of receipt of copy of this order. Copy of the order be given Dasti on payment. July 09, 2009. ( Jasbir Singh ) DKC Judge