Representative company petitions require written consents and stay within the original authorisation scope

A company petition under sections 397 and 398 was required to comply with the representative threshold in section 399 when filed by a member authorised under section 399(4). The authorised member could initiate the petition only within the scope of that authorisation and with the written consents required by section 399(3) for the persons on whose behalf it was made. Strangers not covered by the original authorisation could not be added as supporting petitioners, and absence of the necessary consents rendered the petition not maintainable.

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Issues: Whether a company petition under sections 397 and 398 of the Companies Act, 1956, filed by one person authorised under section 399(4), was maintainable when no written consents of the other authorised members were filed and strangers sought to be added as supporting petitioners.

Analysis: The petition was founded on an authorisation granted by the Central Government to a defined group of members under section 399(4). The statutory scheme treated such proceedings as representative in character and required compliance with section 399(3), namely that the application be supported by the written consents of the persons on whose behalf it was made and that it be for their benefit. The court held that an authorised member could present the petition, but only as a representative petition within the limits of the authorisation and with the required supporting consents. No written consent from any of the other authorised members was produced despite repeated opportunities, and the petitioners who later sought to join were not covered by the original authorisation. The attempt to continue the petition in that form would defeat the purpose of the restrictive threshold under section 399 and amount to an abuse of the statutory mechanism.

Conclusion: The petition was held not maintainable and the applications seeking to add supporting petitioners were rejected.

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