TaxTMI 
TaxTMI 
2008 (1) TMI 628
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....349 of 2003 titled (Registrar of Companies v. Vinay Bharat Ram). 2. The aforementioned Complaint Case No. 349 of 2003 was filed by the Registrar of Companies ("RoC") under section 58A(10) of the Companies Act, 1956 ("the Act") for the alleged contravention of section 58A(9) of the Act. The complaint states that the petitioners and two others were the directors/officers of the company, i.e., DCM Ltd., and were under a statutory obligation to comply with the provisions of section 58A of the Act. It is stated that upon a technical scrutiny of the balance-sheet of the company as on 31-3-2000, it was found that the company had not complied with an order dated 10-9-1998, passed by the Company Law Board ("CLB") directing the company to repay th....
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....mission of Mr. Mittal that since the Regional Director had himself on affidavit informed the High Court even as late as 23-10-2000, that the scheme sanctioned by the Company Law Board was proposed to be implemented by the company as part of the scheme of restructuring and arrangement there could not have been any occasion for the Registrar of Companies to file a complaint against the company for non-compliance with that scheme and that too in 2003. The learned ACMM also proceeded to issue the summoning order on 25-4-2003, without being informed that a petition filed by the company under section 391/394 of the Act was pending in this Court for approval of the scheme of restructuring and arrangement and in which the scheme ordered by the Comp....
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....Affairs of which the Registrar of Companies was a party. 7. Reliance was placed on the judgment of the Supreme Court in J.K. (Bombay) (P.) Ltd. v. New Kaiser-I-Hind Spg. & Wvg. Co. Ltd. AIR 1970 SC 1041, to contend that once there is a scheme approved by the High Court in exercise of its powers under section 394 of the Act, all earlier schemes approved by any other authority concerned, the rights and liabilities of the company or its creditors stand merged in the said scheme approved by the High Court unless a different intention appears. In other words, there could not be a separate implementation of the scheme as directed by the Company Law Board in its order dated 10-9-1998, after it has merged with the scheme of arrangement approved ....
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....9) of the Act. That can certainly be challenged by them in terms of the judgment in Adalat Prasad's case (supra). 11. The facts are not in dispute. The scheme as directed by the Company Law Board in its order dated 10-9-1998, was with the participation of petitioner No. 1. Certain deposits which had already matured were required to be paid in accordance with the scheme approved by the Company Law Board. However, it appears that the Registrar of Companies did not choose to immediately proceed against the company or the petitioners here at that stage. The present complaint was filed shortly before 25-4-2003. 12. The question that first requires to be examined is whether the complaint makes out even a prima facie case of an offence under....
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.... consent to the proposed scheme of arrangement which included the implementation of the scheme approved by the Company Law Board, the Department of Company Affairs through the Registrar of Companies could not have possibly gone ahead with the complaint before the learned Metropolitan Magistrate without awaiting the order of this Court approving the scheme of arrangement. 14. It indeed the scheme as directed by the Company Law Board has merged with the scheme approved by this Court, the very basis of the complaint gets knocked out. The law as explained by the Supreme Court in J.K. (Bombay) (P.) Ltd.'s case (supra) is unambiguous. The Supreme Court said (AIR page 1057) (at page 711 of 40 Comp. Cas.) :- "The principle is that a scheme sa....
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....terms of the scheme a creditor who is bound by it cannot maintain a winding up petition. But if the company commits a default, there is a debt presently due by the company and a petition for winding up can be sustained at the instance of a creditor. The scheme, however, does not have the effect of creating a new debt; it simply makes the original debt payable in the manner and to the extent provided in the scheme. The proposition that a winding up order can only be passed after compelling the company to complete the rights which are still incomplete is not borne out by the decisions relied on by Mr. Sen." 15. In that view of the matter, this Court holds that the scheme as directed by the Company Law Board stood merged in the scheme of re....