P.B. Mukharji, J.
1. This is an application by two persons Nagendra Nath Mandal and Biswanath Mandal. The application is made under two specific sections which are described as Sections 433 and 560 of the Companies Act, 1956. Section 433 deals with the circumstances in which the company could be wound up by the Court. Section 560 deals with the power of the Registrar to strike a defunct company off the register and the Court's power either to restore the company or to wind up the company thereafter.
2. The applicant Biswanath Mandal has no locus standi. He is neither a registered shareholder nor a member nor a director of the company Rai Saheb U. N. Mandal's Estate Private Ltd. An application for winding up can be made by persons and authorities mentioned in Section 439 of the Companies Act. The applicant Biswanath Mandal does not come within that classification. An application under Section 560 for restoration under Section 560(6) of the Act can only be made by the company, member or creditor. But the applicant Biswanath Mandal is neither the company nor the member nor the creditor. It follows, therefore, that so far the application is an application by Biswanath Mandal it must be and is dismissed with costs.
3. The applicant Nagendra Nath Mandal is a director of this company Rai Saheb U. N. Mandal's Estate Private Ltd. which has been struck off the register by the Registrar of Joint Stock Companies, This company is a private company. Its members and directors are all relations. Applicant Nagendra is a director and the two other directors who are opposing this application are Manindra and Baidya-nath. Manindra and Baidyanath are the nephews of Nagendra. A genealogical table showing the relationship is set out in the affidavit of Baidyanath and Manindra Nath Mandal affirmed on 24-6-1957. The company was primarily a zemindari company. Its main purpose was to acquire, undertake, zemindaris, putnis, taluks etc. It was incorporated on or about 23-11-1929. Its registered office was at Sanctorea, Burdwan, West Bengal.
4. The record of this company is most unpromising. Ever since 1929 when it was incorporated it declared no dividends. It in fact never functioned and held no meetings. In fact no minutes of meetings of shareholders are produced. No minutes of the meeting of the Board of Directors are produced. There is no minute book. The company had no banking accounts in which its bank balance could be or was kept.
5. On 27-4-1956 the Registrar of the Joint Stock Companies wrote to the applicant Nagendra calling his attention to the fact that the company had failed to submit summaries as well as lists or shareholders for the years 1941 to 1944 and from 1944 to 1955 and pointing out that if those summaries and lists were not filed within seven days, then such failure would result in prosecution.
6. Applicant Nagendra replied to that letter on 7-5-1956 stating that his elder brother Rai Saheb U. N. Mondal was the Managing Director of the Company and was in sole and exclusive management as such and that the Managing Director had all the books, records and papers of the company under his exclusive control and management and that, he the applicant Nagendra had 'absolutely nothing to do with that matter.' He informed the Registrar that Rai Saheb U. N. Mondal had died on 4-5-1956 leaving three sons of whom the eldest was Baidya Nath and asserted that Baidya Nath had been a Director of the Company all along. Applicant Nagendra further stated in that letter that after the death of the Managing Director which happened only three days before the letter, all the records, account books and papers of the Company were in the possession of Baidya Nath Mondal. Having shifted the responsibility on the respondent Baidya Nath Mondal, the applicant Nagendra Nath Mondal proceeds in that letter to advice the Registrar in the following words :
'In the circumstances I pray that the necessary informations may be gathered from the said Shri Baidya Nath Mondal, Director, Sanctoria Village, Dishergarh P. O., (District Burdwan), who may be written to for supplying the required informations, x x x As such, I may be excused in the matter.'
The position then is that the applicant Nagendra disclaimed all knowledge of this company although he was supposed to be a director. He at any rate admits in this letter that he as director never did any work. The Registrar duly took the information from the respondent Baidya Nath Mondal.
7. Baidya Nath Mondal on 22-5-1956 informed the Registrar in reply to his letter of 27-5-1956 addressed to the Company asking for a month's time to submit the statements on the ground of his father's death. Finally, on 3-7-1956 respondent Baidya Nath Mondal wrote to the Registrar that the Company since its inception did not function at all. It had no assets nor any liabilities and that the company should be treated as defunct and its name should be struck off the register.
8. The Registrar thereupon followed the procedure laid down under Section 560 of the Companies Act. On 11-7-1956 he sent notice to the company under Section 560(1) enquiring if the Company was carrying on business or was in operation. He received the reply from Baidya Nath Mondal on 26-7-1956 stating that the Company was not carrying on business nor was in operation and that its name should be struck off the register. As I have already said, applicant Nagendra had already informed the Registrar that he had nothing to do with the matter and that he knew nothing.
Then the Registrar gave notice under Section 560(3) of the Companies Act for dissolution of the Company and striking off its name unless cause to the contrary was shown within three months. No cause to the contrary was shown by applicant Nagendra or by any one else. The Registrar then under Section 560(3) issued the final Notification dated 11-8-1956. On the expiry of the time mentioned in the notice and on the ground that no cause to the contrary was Shown by the Company, the Registrar issued the final notice under Section 560 declaring the dissolution of the Company and striking its name off the register for default, and such Notification dated 3-1-1957 was duly published in the Gazette of India.
9. Thereafter on or about 18-4-1957 this present application was made.
10. The main grounds which, have been urged by Mr. Das appearing for the applicants may be briefly summarised as follows :
11. In support of the application, he contended that the Company owned certain properties under the Kobala dated 27-11-1929 and the Deed of Release of the same date executed by Shyamlal, Mukupdalal, Upendra Nath and Nagendra Nath as Trustees in favour of the Company, Secondly, Mr. Das urges that certain proceedings are pending in which the Company is a party. Thirdly, Mr. Das contended that the Company had certain book debts which should be recovered for the Company.
12. On these grounds Mr. Das's first line of argument was that the Company should be restored and allowed to carry on business. His second line of argument was that if that could not be done, then the Company should be wound up by the Court and a Liquidator appointed to carry on the pending litigation and recover any assets of or debts due to the Company.
13. On an analysis of the basic facts in thiscase for which many affidavits have been used inthese proceedings, I have come to the conclusionthat the facts do not justify or support any of thethree arguments of Mr. Das for the applicants. Ishall state my reasons briefly.
14. It is quite true that this Company was formed. It is also true that certain properties of the members of this family were transferred to the Company. But that is all. The Company never really did any business at least from 1949 and has violated and disregarded every rule of the Companies Act, Not only no meeting of the Company, either of the Directors or Share-holders, was ever held but also the Company never actually in fact went into possession of the lands purported to have been transferred to it. In fact, the original owners continued in their own possession.
15. A list of joint properties was made between the members of the family including the present applicants. These lists mention Schedules 'Kha', 'Ga' and 'Gha'. The properties mentioned in these three Schedules were taken back by the original owners, namely, Upendra, applicant Nagendra and respondent Baidya Nath. The properties mentioned in Schedule 'Kha' were divided amongst the Four brothers equally. This agreement was in 1933. Later in 1942 the four brothers made a list of the joint properties situate in the State of West Bengal which had been partitioned amongst themselves. A similar list was also made in 1946 in respect of the properties in Bihar. That these properties were divided amongst themselves is shown from these lists duly signed among others by applicant Nagendra himself. The original documents were produced in Court, They are in Bengali. But the applicant had inspection of them before they were produced in Court here. In fact, in the affidavit-in-opposition of Baidya Nath Mondal affirmed on 24-6-1957, he craved reference to the original documents at the time of the hearing of the application. This fact considerably changes and alters the picture on which the applicant wanted to rely, namely, the fact of the formation of the Company and the transfer of properties to the Company. In this view of the fact they both appear to be illusory.
16. The entire subsequent conduct of the patties and treatment of these properties also show almost conclusively that the Company neither acted nor behaved as owner of any property nor exercised even any rights of ownership. The parties continued to enjoy their properties individually and in exclusion of one another. The partition, therefore, was not only agreed between all the parties but was accepted and acted upon. In proof of such conduct, many instances have been adduced. Basically those instances have not been controverted by applicant Nagendra. I shall make a brief reference to these instances.
17. The property at Mauza Mera in Bihar was one of the properties which was supposed to have been conveyed to the company. This, however, went to the applicant Nagendra Nath Mondalhimself who exercised full rights as a complete owner of such property. The applicant Nagendra admits in his own affidavit of 17-8-1957 this agreement in 1949 that it was agreed between the shareholders that each of them would occupy and cultivate certain portions of the land belonging to the Company. Nagendra admits that with regard to Mauza Mera rent was paid by himself, but he puts forward an excuse that the Company wrongfully failed to pay the rent.
18. Secondly, the house at Nersa in Bihar became the full property of Nagendra who exercised all rights of ownership and title openly. The property was sold by Nagendra himself in J.952 although that was also said to be an item of the property conveyed to the Company. But while the property was sold by Nagendra, he did not mention even the name of the company as a conveying party in the document. Thirdly, the lands in Mauza Gangutia were also sold by Nagendra in 1956. These lands fell to Nagendra's share after the said agreement and partition. The respondent Baidya Nath craved reference to the certified copy of the documents on this point. I found, however, that applicant Nagendra had to admit again in his same affidavit that it was agreed that the house at Nersa and the Mauza Gangutia would be sold and the sale-proceeds would be paid to Nagendra. He, of course, again gives the excuse that all this was done in part satisfaction of Nagendra's alleged claim towards the rent collected by the Company on his behalf. Lastly, Mauza Barbenda, Paturdih, Ratanpur, Haripur, Chawk & Mera all became properties of applicant Nagendra. All these properties were acquired by the Government, but the entire compensation was enjoyed by the applicant Nagendra although the properties are supposed to be of and in the name of the Company, Nagendra in his affidavit of 17-8-1957 does not dispute or deny this receipt of the whole of the compensation money. He gives a version which again makes the fact of partition very clear. In paragraph 22 of his affidavit of 17-8-1957 Nagendra says that by consent the entire compensation was distributed amongst the share-holders and/or their legal representatives according to their shares in the Company. I have never heard of a real or regular Company which is not an illusory one like the present, dividing according to shares a particular item of income in this manner. It only shows this that the Company was only a name.
19. I may mention here two other properties. One is the land from Maharaja Manindra Chandra Nandy's estate acquired in the name of the Company. But that also was divided amongst the brothers. There was a suit in the name of the company, but such suit is no longer pending. A decree was made. The other is the land leased out to Karam Chand Thappar and Sons and which appears to be the personal properties of respondent Baidya Nath and are included, I find, in Schedule 'Gha' to the document of 27-11-1929.
20. At this point Mr. Das relied on some of the rent receipts and rent dakhilas with a view tot-showing; that the Company was letting out or granting rent receipts. Again, the apparent is not the real. If the Company was receiving rents and granting rent receipts, the Company should have had' some books and some Bank accounts to show that. There is none. In fact, respondent Baidya Nath says in paragraph 16 of his affidavit of 24-6-1957f that the Company had no existence and no rents were paid to the Company. The apparent, therefore, is not the real, and in that context the affidavit of Dasarathi Bhattachariee, a clerk in the department of the Zemindary Coal Co. Ltd., and New Birbhum Coal Co. Ltd., about rent receipt granted on behalf of the Company to these concerns does not prove Nagendra's allegations. In fact, paragraph 3 of Dasarathi's affidavit affirmed on 19-11-1957 shows that these alleged rent receipts were signed by U. N. Mondal or Baidya Nath Mondal for H. S. Mondal. It is not disputed that a Company was at one time formed. The only question is whether the Company at all functioned as such or whether it was only a cover or a mere name under which the members of the family worked individually in their own rights.
21. An enquiry and survey was made by the Attestation Officer who found as a fact on 7-10-1956 that all these properties were in the respective possession of the respective members of the family, that the so-called Company never really functioned, that the transfers to the Company were never in fact acted upon. He found the Company to be a mere name. The properties in different mauzas were found to be in the possession of the respective parties. The Attestation Officer found that the rent of the property which was taken on settlement by Baidya Nath on 11-7-1928 against kabuliyat for a rent of Rs. 560 and which subsequently came to Rs. 532-3-3 for acquisition of some lands was all along paid in the name of Baidya Nath and not in the name of any estate or Company. He found as a fact that the properties bad long been partitioned and respective possession and enjoyment were exclusively for the respective parties. No objection was taken to this finding of fact. Then the proceedings in this Court started; and I find while these proceedings were pending in this Court, applicant Nagendra immediately on discovery of the fact that the finding of the Attestation Officer, which was annexed to the affidavit here of Baidya Nath affirmed on 29-11-1957, would so against the whole contention of the applicant, filed a petition a year and a half later on 14-1-1958 for revision and used that with his affidavit in this Court on 15-1-1958, the day following. It is obvious that it is an inspired document to challenge the facts found by the Attestation Officer so long after in the belief that with those findings staring him in the face he had no chance of succeeding in this application. In fact, the Attestation Officer makes the order upon the application on 14-1-1958 that the property had long been attested and the objector should file his objection under Section 44(1) of the relevant statute.
22. This is the record of treatment of the properties purporting to belong to the Company. To my mind this record establishes beyond doubt that the Company never in fact treated these properties as its own and the members individually possessed and enjoyed them and exercised all rights of ownership thereto. This is the position with regard to the facts on this particular point. I find they do not support the applicant's case that the Company was carrying on business or was in operation at the time the Registrar struck it off the register.
23. I shall now deal with the argument that there are so-called pending proceedings or alleged book debts of the Company. Mr. Das appearing for the applicants could not really show that there was any suit or proceeding pending against the Company which could be said to have been prejudiced by the order of the Registrar striking the Company off the register. In fact, his client's petition itself is against that contention. Two proceedings are alleged to be pending against the Company, one being the certificate proceeding and the other the land revenue settlement proceeding.
24. The certificate proceeding tinder the Public Demands Recovery Act is for the sum of Rs. 216-11-6p. only. All that has happened is that the Junior Land Reforms Officer, Asansol Circle, on 14-2-1957 initiated proceedings to recover the said arrears of rent of Rs. 216-ll-6p. under the Public Demands Recovery Act. It is not even stated in the petition that they are against the Company. Therefore, it cannot be said to be pending either for or against the Company. Besides, the amount is small and in any event the arrears of land revenue will be charged on the property in whomso-ever's share it may have fallen. It is, however, quite a misnomer to call this a pending suit. Actually the Company filed a suit on 24-2-1936 against Raja Shyam Sundar Singh for recovery of money under a bond and obtained a decree. The decree was realised by the Company. In 1933 certificate proceedings were taken by the Government and in respect of certain lands the Company filed objections, but they were dismissed. The Company thereafter filed appeal at Burdwan and ultimately the Company paid the dues of the Government. But no suit or proceeding is pending now against the Company as such. This is all in relation to the 46 Bighas and odd lands from the estate of Maharaja Srish Chandra Nandy for which the Company paid rent under a lease hold & which I have already mentioned. This allegation, moreover, is fully controverted, and rightly in my view, in paragraph 21 of the affidavit of Baidya Nath Mondal affirmed on 24-6-1957, and I have already dealt with this question.
25. The only other alleged pending proceedings are those mentioned in paragraph 20 of the petition. But they relate only to settlement proceedings and attestation. But none of these are for or against the Company. I have already mentioned the Attestation Officer's decision after a full hearing and on enquiry and survey on the spot. But even here there is no proceeding pending for or against the Company. In fact, in the very petition of revision of settlement records which is annexed in the affidavit of Nagendra Nath Mondal affirmed in January 1958, he himself states that the properties are in the name of different persons and recorded as such, but such record should be altered and his allegation at the end of paragraph 5 of that petition of revision is 'All such acts and deeds have no bearing upon the Company inasmuch as they were simply benami transactions without any consideration made by the Managing Director's son with the sole motive of depriving the other Directors of their legitimate shares.' Now this is not a pending proceeding in which the Company is a party.
26. The reason why Mr. Das wanted to rely on the fact of some pending proceedings is not far to seek because he wanted to come within the decision of Umed Bhai Jhaver, Bhai v. Moreswar Keshab AIR 1954 Madh B 146 where it was held that when a suit was actually pending against a Company and was being contested by if at the time of the removal of its name from the register, it was proper to direct the restoration of the name of the Company, particularly when the Directors were aware of the fact of the contested litigation and were actually taking part in it. This case was construing the corresponding section of the older Companies Act. It is unnecessary for me to express any opinion on this decision because the facts here show that there was no pending litigation either for or against the Company.
27. There are no proofs that there are any book-debts owing to the Company and which are waiting to be recovered. In fact the Company keeps no books of account whatever to show what, if any, book-debts there are.
28. This disposes of the main grounds on which this application is based. All the grounds in my opinion fail. But before I conclude it is necessary to add some more observations on the facts and some aspects of the law which have been placed before me.
29. This is a private company. The application is for ventilating private family squabbles. These private squabbles although raised on the level of company administration and interpretation of the sections of the Companies Act do not make them any the less domestic. The members of a family have fallen out. When they do, a company court and a company administration can do little to restore private feelings. The respondents in this case assert that the real motives of the petitioner, are to obtain wrongful payment from Baidyanath Mandal who has been doing good business and has been the object of envy among the members of his own family and specially the petitioners. Applicant Nagendra Nath Mandal being himself the director had ample remedies in his own hands if he ever felt, as he now says he does, that he had been excluded from the company's management and access to records, books, papers and documents and transactions of the Company. Then he could have asked long ago when that happened to intervene. He acquiesced in this management assuming it was bad as he says.
30. Ever since 1929 and for these last 30 years the company has never met either in a shareholder's or in a directors meeting, has not filed for more than 10 years any summaries or lists of shareholders, has shown no balance sheet or bank accounts; it has treated company's properties as though they were properties belonging to the individual members of the family; sales, transfers and various dealings with these properties have taken place for all over these 30 years as though the individual members were owners thereof. If such a company is not defunct I do not know which is.
31. All that the Registrar has under Section 560 of the Companies Act 1956 to do is to satisfy himself whether the company is carrying on business or is in operation. Putting the most liberal interpretation and construction on the words 'carrying on business' or 'in operation' used in that section I do not think that this company can be said to satisfy any tests of business or operation. It may have done so at the very inception, but it long ceased to do so. The Registrar gave every opportunity by public and private notices to persons interested to show cause to the contrary or to satisfy him that in fact the company was carrying on any business or was in operation. No such cause was ever shown. I feel that on the facts of this case the Registrar was quite justified in striking off this company from the register.
32. Section 560(5) of the Companies Act, 1956 provides that when the name is struck off the register, and the notice thereof published in the official Gazette, then the Company stands dissolved on the publication in such official Gazette. But such dissolution of the company does not affect the liability, if any, of any director, managing agent, secretaries and treasurers or manager or even any other officer who was exercising any power of management or of any member of the company & it is expressly provided by proviso (a) of that sub-section that for enforcement of such liability it will be deemed in law to continue and may be enforced as if the company had not been dissolved. If, therefore, applicant Nagendranath has any grievance against the respondent Baidyanath as a director, Baidyanath's liability as a director remains in spite of its dissolution and can be enforced. The special statutory provisions of Section 560(5) of the Companies Act 1956 appear to indicate that the dissolution of the Company thereunder does not mean a total and complete extinction of the Company for all purposes but that it exists for the special purpose expressly mentioned in proviso (a) of Section 560(5) of the Act as if the company had not been dissolved.
33. No doubt proviso (b) of Section 560(5) of the Companies Act 1956 also expressly preserves the power of this Court to wind up a company the name of which has been struck off the register. In other words notwithstanding Registrar's dissolution, of the company the court's power to wind up the company remains unaffected. If I felt that any useful purpose could be served by winding up the company and setting up the costly machinery of liquidation of this Court, I certainly would have done so. It is no good winding up this company. A winding up will mean setting up a whole machinery for liquidation. The liquidator has to be appointed, and his staff has to be provided. But what will such a liquidator do? Every item of property claimed for the company is disputed. Liquidator therefore cannot take possession of any property without first initiating litigation There is no bank money or fund which the liquidator can take possession of. There are no books, share register, minutes or any other papers which the liquidator can take charge of. No one is going to finance the liquidator's establishment. How then is such a liquidator going to work? He is to rely on the members of the family. But they are quarrelling with one another and the liquidator can get no assistance from them in those circumstances. It will be a mere farce and a paper order therefore to appoint a liquidator to wind up the company. I therefore decline to do so.
34. I need only add to emphasise the points of construction that proviso (b) of Section 560(5) of the Act gives the power to the Court to wind up a company even without restoring the company to the register. The Note on Re : Cambridge Coffee Room Association, Ltd., (1952) 1 All ER 112 is not of much assistance to the applicant because there Wynn-Parry, J. was dealing with the only question whether or not it was more convenient to restore the name of the company to the register before making a compulsory winding up order and came to the conclusion that it was more convenient to do so. But His Lordship was careful enough to say :
'I do not intend to cast doubt on past cases where a compulsory winding-up order has been made without the name of the company having been restored to the register.'
In fact, his Lordship could not because of the express and clear language of the English Companies Act, 1948 which corresponds on this point in material particulars with our Section 560. What is convenient need not be confused with what is legal.
35. Apart from the court's power to declare the dissolution of a company void under Section 559, the power of the court to restore the company, is really provided in Sub-section (6) of Section 560 of the Companies Act, 1956. The reason for restoration must be sought in the satisfaction of the court that the company, at the time when struck off, was carrying on business or in operation or otherwise that it was just that the company should be restored to the register. The time of the striking off is the crucial point. At that crucial point of time it is plain and obvious on the facts as I have analysed, that no business was being carried on by this company.
36. Lastly, on the interpretation of Sub-section (6) of Section 560 of the Companies Act, 1956, I am of the opinion that this power of the Court to restore the Company is discretionary. This is not a mandatory provision. No doubt, the Court's discretion must be well reasoned. One of such reasons for exercising the discretion in favour of restoring a Company must, in my view, be that after restoration the Company will be in a position to carry on the business of the Company. Otherwise, such order for restoration will be a mere ritual and an idle ceremony, In this case on the facts, I have not the slightest doubt and hesitation in my mind that even if I had restored the Company, it would be impossible for this Company to carry on any business having regard to the attitude and the disputes between the members of the family. I am, therefore, of the opinion that even if I were otherwise satisfied that the Company could be restored to the register, I would not do so for the practical reason that it would be idle to make such an order in the context of the present facts of this case.
37. Before, I conclude, it is necessary to refer to one argument which cropped up in course of the hearing of this application. Shortly put, it is this. What the applicant argued was that if there was any property or asset of the Company, then there would be none to take it over and it will be a loss to everyone concerned. Mr. Das for the applicant contends that as the result of the effect of striking the Company off the register and of the dissolution that follows, the Company loses its character as an incorporated body and, therefore, cannot recover its own properties, if there be any, Now this point has become academic on the facts of this case as I have held that there are no assets of this Company and no fund and no book debts which it can recover. But even if there were any, the situation may not be so hopeless as was argued on behalf of the applicant. Even if there were any property, such property will not be without an owner. The doctrine of bona vacantia, I think, is attracted or will be attracted in that contingency. The assets of a dissolved Company are not without owner. The State takes them over. The legal position in India on the point demands a scrutiny.
38. It is necessary to point out at the outset the difference between the English Act and the Indian Statute. Section 353 of the English Companies Act, 1948 is in pari materia with most of the Section 560 of the Companies Act, 1956 in India. But there is, however, Section 354 of the English Companies Act, 1948 which expressly says that the property of a dissolved Company would be bona vacantia, and Section 355 of the same English Statute gives the power to the Crown to disclaim title to property vesting under Section 354. In the Companies Act, 1956 in India there are no corresponding provisions like Sections 354 and 355 of the English Companies Act, 1948. Speaking for myself and without deciding the point, I do not think that this makes any difference. Mr. Das for the applicant argued that but for those two Sections 354 and 355 of the English Companies Act, 1948, the property of the dissolved company would not be regarded as bona vacantia and, therefore, these two sections were introduced into the English Statute. I am afraid I cannot take that view having regard to the history of the English Company Law on the subject. Even independently of and apart from the statutory provisions like Sections 354 and 355 of the English Companies Act, 1948, the doctrine of bona vacantia did apply in England to the property of a dissolved company (sec in re T. S. Wells: Swinburne-Hanham v. Howard, (1933) 1 Ch. 29. Both Lord Hanworth as well as Lawrence, LJ. made it quite clear that the doctrine of bona vacantia applied before the Statute made it clear by Section 296 of the English Companies Act of 1929 which was the predecessor of Section 354 of the English Companies Act of 1948 on this point. The same appears to be also the conclusion of Romer, LJ in that case. The still older case in re Higginson and Dean; ex parte Attorney-General (1899) 1 Q.B.D. 325 confirms the view that such properties can be claimed as bona vacantia apart from the Statute. Mr. Das drew my attention to the recent decision in Re Azoff-Don Commercial Bank, (1954) 1 Ch. 315. That case, however, does not help him on this point because it did not say that the doctrine of bona vacantia did not exist in such circumstances but only laid down the obvious principle sufficiently made clear in the Statute of 1948 that the Royal Prerogative in respect of bona vacantia was cut down by the provisions of English Companies Act, 1948 in the sense that it was a defeasible title of the Crown liable to be defeated by winding up order which under the appropriate conditions could be made without the Crown's consent.
39. If, therefore, without the express statutory provisions of Sections 354 and 355 of the English Companies Act, 1948, the doctrine of bona vacantia applied in England, it would be all the more so here in India because of Article 296 of the Constitution of India, which uses the words 'any property in the territory of India which if this Constitution had not come into force would have accrued to His Majesty.' Now if this property of a dissolved Company could accrue formerly to the Crown in India then as bona vacantia it now belongs to and vests in the Union of India under Article 296 of the present Constitution. Normally a defunct Company would hardly have any assets or property, but them may in few cases be some, however negligible. I asked Mr. Basu who was the Counsel appearing for the Registrar of Joint Stock Companies to find out whether on the point the office of the Registrar, had already any procedure, and I was told that them was none. Parliamentary legislation appears to be necessary to evolve an administrative machinery for the protection and disposal of the assets of a Company, dissolved under Section 560 of the Companies Act 1956. For unclaimed dividends and undistributed assets of Companies in liquidation there is provision for their going to the public account of India in the Reserve Bank under Section 555 of the Companies Act. But there appears no comparable provision for assets of dissolved Companies under Section 560 of the Act.
40. It is, however, unnecessary for me to decide this question of how far, if at all, the doctrine of bona vacantia apply to properties of a dissolved Company in this case on the ground that the facts at any rate do not show satisfactorily here that there is any asset or property of this defunct company. It may also be that because of the express provision in Article 296 of the Constitution the Companies Act, 1956 in India which copied in Section 560 the major provisions of Section 354 of the English Companies Act, 1948 did not introduce the further provisions of Sections 355 and 356 of the English Statute.
41. For these reasons, the application must be and is dismissed with costs. Certified for Counsel.