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        1925 (6) TMI 2 - HC - Indian Laws

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        Demand under his hand does not include an advocate's personal signature; creditor's own or authorized signature required. The text addresses two procedural prerequisites: first, that a demand 'under his hand' for purposes of Section 163 must be attributable to the creditor's ...
                        Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.

                            Demand under his hand does not include an advocate's personal signature; creditor's own or authorized signature required.

                            The text addresses two procedural prerequisites: first, that a demand "under his hand" for purposes of Section 163 must be attributable to the creditor's own hand or to an authorized signing amounting to the creditor's hand; an advocate's notice signed in the advocate's own name does not satisfy that statutory requirement. Second, Rule 30's advertising requirement was not met because the advertisement appeared only ten days before the hearing, falling short of a clear fourteen-day interval. The result: preliminary objections sustained; petitioners may re-advertise, procure proper evidence of inability to pay, or obtain fresh date.




                            Issues: (i) Whether a notice of demand issued and signed by an advocate on behalf of a creditor satisfies the requirement of "a demand under his hand" in Section 163 of the Indian Companies Act; (ii) Whether there was a clear interval of fourteen days between the date when the advertisement appeared and the date fixed for hearing as required by Rule 30 of the Rules.

                            Issue (i): Whether an advocate's notice of demand fulfils the statutory requirement of a demand "under his hand" under Section 163 of the Indian Companies Act.

                            Analysis: The Court examined authorities on signatures and agency, noting distinctions between an agent signing the principal's name and an advocate signing his own name as agent. The statutory words "under his hand" were considered peculiar and potentially restrictive. The Court weighed precedents allowing agent signatures where statute does not expressly prohibit agency, and contrasted authorities holding that a solicitor's signature is not equivalent to the principal's personal signature in contexts where personal signature was deemed indispensable. Consideration was given to the purpose of Section 163, namely creating a conclusive presumption of inability to pay upon a valid demand and default, and the need for strict construction where the statute grants a privileged, restrictive right to one party.

                            Conclusion: An advocate's notice of demand signed under the advocate's own hand does not satisfy the requirement of Section 163 of the Indian Companies Act; the notice must be one issued under the creditor's hand (or otherwise fall within an authorized signing that amounts to the creditor's hand).

                            Issue (ii): Whether the advertisement requirement was complied with, specifically the existence of a clear interval of fourteen days between advertisement appearance and the hearing as required by Rule 30.

                            Analysis: The Court found that although the order to advertise was made in time, the advertisements were issued late because the petitioners paid charges late; the advertisements actually appeared only on 2nd June while the hearing was fixed for 12th June, resulting in insufficient clear interval.

                            Conclusion: The advertisement requirement of Rule 30 was not complied with; there was not a clear interval of fourteen days between the appearance of the advertisement and the fixed hearing date.

                            Final Conclusion: The Court upholds the preliminary objections: (i) an advocate's notice does not meet the Section 163 requirement and (ii) the advertising interval under Rule 30 was not satisfied. The objections are, however, procedural preliminaries and not fatal to the petition-petitioners may withdraw or proceed by adducing other evidence of inability to pay and must re-advertise and obtain a fresh date if proceeding.

                            Ratio Decidendi: Where a statute confers a conclusive legal consequence upon the giving of a demand "under his hand", that phrase requires a demand that can be attributed to the creditor's hand (or an authorized signing amounting to the creditor's hand); a solicitor's or advocate's signature in his own name does not satisfy that requirement absent express or necessarily implied authorization permitting such delegation.


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                            ActsIncome Tax
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