1986 (7) TMI 331 - HC - Companies Law

Computer-printed memorandum and articles of association satisfy 'printed' requirement under section 15 Companies Act 1956

Selvarajan & Company Versus Registrar of Companies

The HC held that computer-printed memorandum and articles of association satisfy the 'printed' requirement under section 15 of the Companies Act, 1956. ... Computer-printed memorandum and articles of association can be accepted as 'printed' under section 15 of the Companies Act, 1956 - interpretation of the term 'printed' - applicability of technological advancements in printing to legal requirements - HELD THAT:- The argument is that if this kind of printing is accepted, it will open the floodgates, for recognising typewritten or cyclostyled materials undermining the very object with which the statute has prescribed printed document, cannot be held to be tenable. There is an ocean of difference between printing and typewriting or cyclostyling. They cannot be compared with a case of computer-printing. The stand taken in the counter-affidavit that the writ petitioner is agitating only from a selfish angle to save a few hundred-rupees in printing cost, unmindful of the far-reaching adverse consequences resulting from watering down the statutory requirement, in my considered view, is an argument which has to be rejected. As I said above, the great benefits that are to be received in computer-printing cannot be lightly ignored as though the petitioner desires to save a few hundred rupees. Law is never static, but it is dynamic. Looked at from that point of view, the word 'printing' cannot be so technically construed, as the Registrar would have it, to enable him to contend that this will water down the statutory requirement. If, as quoted above from Bouvier's Law Dictionary, printing is the art of impressing letters and it is a process of multiplying the copies of a composition by sheets, certainly computer-printing clearly falls within the definition. Obstacles should not be thrown on the road to scientific progress by these orthodox representations, unmindful of the great changes taking place with scientific technological advancement. Thus, I hold that the stand of the Registrar cannot be accepted and this is not a case in which it could be said that, by virtue of regulation 17 of the Companies Regulations, 1956, he could hold the document to be defective. Accordingly, the writ petition will stand allowed and a direction will issue to the Registrar to accept this memorandum brought about by computer-printing. Issues Involved:1. Whether computer-printed memorandum and articles of association can be accepted as 'printed' under section 15 of the Companies Act, 1956.2. The interpretation of the term 'printed' within the context of the Companies Act, 1956.3. The applicability of technological advancements in printing to legal requirements.Issue-wise Detailed Analysis:1. Acceptance of Computer-Printed Memorandum and Articles of Association:The petitioner, a firm of chartered accountants, argued that computer printing is a well-developed technology and should be accepted similarly to offset printing, which was recognized by the Department of Company Affairs in Circular No. 3/81 dated December 15, 1981. The petitioner submitted the memorandum and articles of association of six companies, all printed by a reputed firm using computer technology. However, the Registrar of Companies rejected these documents, stating they did not comply with section 15 of the Companies Act, which mandates that the memorandum and articles of association must be printed. The Registrar argued that computer printing is akin to typing, susceptible to erasing, defacing, and tampering, and thus not recognized as 'printing' under the Act.2. Interpretation of the Term 'Printed':The court examined the definition of 'print' and 'printing' from various dictionaries and legal texts, including Webster's Dictionary, Bouvier's Law Dictionary, and Encyclopaedia Britannica. The definitions highlighted that 'printing' involves the process of multiplying copies by impressing letters or characters onto a surface. The court noted that printing is a technique for applying a quantity of coloring agent onto a specified surface to form text or illustrations. The court emphasized that the term 'printing' should not be confined to traditional methods but should be interpreted in light of technological advancements.3. Applicability of Technological Advancements in Printing:The court acknowledged the significant technological advancements in printing, including computer printing, and emphasized that the law should not remain static but be dynamic. The court rejected the Registrar's argument that computer printing might fade over time, stating that this was a mere guess unsupported by technical data. The court also dismissed the concern that accepting computer printing would open the floodgates for recognizing typewritten or cyclostyled materials, noting the clear distinction between these methods and computer printing.The court concluded that computer printing fulfills the requirements of printing as defined by the various sources consulted. The court held that obstacles should not be placed in the path of scientific progress and that the benefits of computer printing should not be ignored. The court quoted Viscount Simon, emphasizing that clinging to the literal interpretation of the law misses the truth and substance of the matter.Conclusion:The court allowed the writ petition, directing the Registrar to accept the computer-printed memorandum and articles of association. The court held that the Registrar's refusal to recognize computer printing as 'printing' under section 15 of the Companies Act was not justified. The court emphasized the importance of adapting legal interpretations to accommodate technological advancements, ensuring that the law remains dynamic and relevant.