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Judgment
Nain, J.—The question that arises for determination on this summons is whether on the original side of the Bombay High Court where the dual system prevails in most of the matters, there is a duty cast on the party or his attorneys to draw up orders under the Companies Act, 1956, or whether in such matter the orders must be drawn up by the Registrar of the court. This summons has been taken out by the applicant/petitioner for consideration of delay in filing certified copy of an order passed by this court on 23rd April, 1971, confirming a resolution for alteration of the memorandum of association of the appellant-company permitting it to expand its objects clause so as to include business originally not included in the memorandum of association of the company.
The order confirming the resolution was passed on 23rd April, 1971. On 21st August, 1972, the appellant made an application for a certified copy. The order was drawn up and sealed on 29th September, 1972, and the copy thereof was furnished to the applicant on 2nd October, 1972. On the same day the certified copy was filed by the applicant with the Registrar of Companies. The Registrar raised the objection that printed copies of the memorandum of association should be furnished to him. These were furnished on 26the December, 1972. The Registrar contended that on 26th December, 1972, the filing of the order dated 23rd April, 1971, would be beyond the time prescribed by section 18 of the Companies Act, and refused to take the order on file. Thereafter, on 17th April, 1973, the present summons was taken out.
As the matter concerns the rules framed by the Supreme Court under the Companies aCt, the rules of this court on its original side and the practice of this court, I gave notice to the Incorporated Law Society. Mr. R.D. Kothari, solicitor, has appeared on behalf of the Incorporated Law Society. i also requested Mr. J.I. Mehta, advocate, to assist the court amicus curiae and he has been good enough to do so.
Section 17 of the Companies Act, 1956, provides for confirmation by the court of resolutions for alteration of memoranda of association of companies. Section 18(1) prescribes that a certified copy of the order of the court made under the section 17(5) confirming the alteration together with a printed copy of the memorandum of association as altered shall, within three months form the date of the order, be filed by the company with the Registrar. Section 18(4) provides that the court may, at any time, by order extend the time for filing of the documents or for registration of the alteration under the section 18 are not filed within the time allowed under that section, such alteration and the order of the court made u/s 17(5) and all proceedings connected therewith shall, at the expiry of such period, become void and inoperative. There is a proviso to section 19(2) which states that the court may, on sufficient cause shown, revise the orders on application made within a further period of one month. Section 640A provides for computation of time for filing orders of court and states tha except as expressly provided in that behalf elsewhere in the Companies Act, where by any provision of the Act any order of the court is required to be filed with the Registrar of Companies or any other person within a period specified therein, then in computing that period the time taken in drawing up the order and in obtaining a copy thereof shall be excluded.
The contention of the Registrar of Companies is that the time prescribed for filing a certified copy of the order, dated 23rd April, 1971, is three months, and the said certified copy not having been filed on or before 23rd July, 1971, the filing of the certified copy on 26th December, 1972, or even on 2nd October, 1972, would be beyond time and by virtue of section 19(2) of the Companies Act, 1956, the alteration as well as the proceedings for confirmation have become void and inoperative.
On behalf of the applicant my attention has been drawn to section 643(1)(a) of the Companies Act which empowers the Supreme court to make rules in respect of matters prescribed by the Companies act except matters reserved to the Central Government. Sub-section (3) of the section 643 provides that until rules are made by the Supreme court, all rules made by any High Court on the matters referred to u/s 643 and in force at the commencement of the Act shall continue to be in force in so far as they are not inconsistent with the provisions of the Companies Act in that high court and in courts subordinate thereto. The question of the High Court rules continuing to be in force, however, does not arise in view of the fact that the Companies (Court) RUles, 1959, framed by the Supreme Court are now in force. Rule 37 of these Rules framed by the Supreme Court provided that every order, whether made in court or in chambers, shall be drawn up by the Registrar, unless in any proceeding or class of proceedings the judge or the Registrar shall direct that the order need not be drawn up. the contention of the applicant is tha truly 37 casts a mandatory duty on the Registrar (the term "Registrar" under rule 2(11) includes the prothonotary of this court) to draw up every order whether made in court or in chambers. The applicant contends that the order was so drawn up and settled and sealed by the Registrar on 29th September, 1972. Therefore, the time from the date of the order, viz., 23rd April, 1971, to the date of its being drawn up on 29th September, 1972, and secondly the time from the date of the application for a certified copy, viz., 21st August, 1972, to 2nd October, 1972, when the certified copy was furnished to the applicant hs to be excluded from the time prescribed by section 18 by virtue of section 640A of the Companies Act. The applicant contends that the entire time from the date of the order, viz., 23rd April, 1971, to 2nd October, 1972, has to be excluded by the above process of reasoning. It states that it has filed the order with the Registrar on 2nd of October, 1972, and even if it be taken that it should be deemed dto have filed the order on 26th December, 1972, when printed copies of the memorandum of association were furnished to the Registrar, it would still be within the period of three months from 2nd October, 1972.
Mr. Mehta drew my attention to rules 91 to 286 of the Rules of this court on its original side. Rule 91 provides that a decree or order passed in chambers shall be drawn up by the party initiating the proceedings unless the judge passing the decree or order otherwise directs and that such party shall lodge the draft of the decree or order in the office of the prothonotary and senior master within four days form the date of the decree or order and shall apply to fix a time to settle the draft. Rule 91 obviously applies to decrees and orders passed in chamber, Correspondingly, rule 286 applies to decrees and orders passed in court and casts a duty on the party initiating a proceedings to draw up the decree or order and to lodge the draft in the office within ten days. The order dated 23rd April, 1971 being an order passed in court under the rule 286 it should have been the duty of the party to lodge the draft of the order in the office of the prothonotary within 10 days form the date of the order and to apply to him to fix a time to settle the draft. Mr. Mehta contended that it was the duty of the applicant to have followed rule 286 and he being in default, the time taken in drawing up the order should not be excluded.
At this stage one may compare the provisions of section 12(2) of the Limitation Act, 1963, with the provisions of section 640A of the Companies Act. Under the section 12(2) in computing the period of limitation for an appeal or an application the day on which the judgment complalined of was pronounced and the time requisite for obtaining a copy of the decree has to be excluded. The Explanation to the section, however, provides that in computing the time requisite for obtaining a copy of a decree or an order, any time taken by the court to prepare the decree or order before an application for a copy thereof is made shall not be excluded. It is clear, therefore, that in excluding time u/s 12 of the Limitation Act, 1963, if there is no application for a certified copy, the time taken in drawing up the decree or order is not excluded. But once an application for a certified copy is made, the time taken for drawing up the decree or order is to be excluded. Whereas u/s 640A of the Companies Act, irrespective of an application for a certified copy are to be excluded. The applicant is, therefore, right in contending that if the duty to draw up the order was on the Registrar, the entire time from 23rd of April, 1971, ot 2nd October, 1972, will have to be excluded.
My attention has been drawn to two judgments, one of the Madras High Court in the case of Saroja Mills Ltd. v. Registrar of Companies [1964] 34 Com Cas. 336, wherein Veeraswami J. (as he then was) held, that u/s 18(1) read with section 640A of the Companies Act, 1956, in computing the period of three months within which an application for a copy of the order of the court confirming an alteration of the memorandum has ot be made, the time taken for drawing up the order should be excluded. In that case the order confirming the alteration of the memorandum of association of a company was made in January but the order was drawn up in April and the application for a copy of the order was made in June. The learned judge held that the application was in time. This judgment obviously supports the contention taken by the applicant before me.
THe other case cited by the applicant is a judgment of the Supreme Court in the case of Jagat Dhish Bhargava Vs. Jawahar Lal Bhargava and Others, , wherein it is observed that except in places where the dual system prevails, the litigant or lawyer does not play any material or important part in the drawing up of the decree. In fact, the process of drawing up of the decree is beyond the litigant''s control. Therefore, there is no doubt whatever that in failing to draw up a decree in that suit the office of th retrial court was negligent in the discharge of its duties. The Supreme Court further observed that :
"....where the dual system does not exist, it would b elide to contend that it is a part of the duty of a litigant to remind the court or its office about its obligation to draw up a decree after the judgment is pronounced in any suit. It may be that decrees when drawn up are shown to the lawyers of the parties; but essentially drawing up of the decree is the function of the court and its office, and it would be unreasonable to penalise a party for the default of the office by suggesting that it was necessary that the party should have moved the court for the drawing up of the decree."
Mr. Mehta suggested that in the court in this case it was the duty of the applicant to move the court for drawing up of the order and as the applicant had failed in this, the time taken in drawing up the decree should not be allowed. I am afraid, this argument is met by the observations of the Supreme Court in the above case.
In my opinoin, rule 37 of the Companies (Court) Rules, 1959, casts an imperative duty on the Registrar to draw up all orders under the Companies ACt whether made in court or in chambers. In view of the above duty cast by the rules framed by the Supreme Court, rules 91 and 286 made by this court, which were in force up to 1959, would no longer apply or cast a duty on the party to draft orders under the Companies Act with the prothonotary and to apply for time to settle the drafts. It would be the duty of the Registrar himself to draw up the orders of the court. Although the dual system prevails on the original side of the Bombay High Court, by virtue of rule 37 of the Companies (Court) RUles, 1959, there is no duty on the litigant or his lawyer either to draw up the orders under the Companies Act and to lodge them with the Registrar or to apply to him for the orders being settled or even to remind the court or its office about its obligation to draw up such orders. I am afraid, it is the function of the Registrar to draw up all orders and no party can be penalised for the default of the office in drawing up the orders. These rules apply uniformly to all courts in India including those where the dual system prevails and including the Bombay High Court on its original side.
In view of the fact that I have taken the view that there is no delay on the part of the applicant, the Registrar is directed to take the order and copies of the memorandum on file. In the circumstances of the case, there will be no order as to costs.
The Registrar of Companies shall act on a certified copy of the minutes of this order.