W. Brooms, J. - (1.) A private limited company known as Motilal Padampat Sugar Mill Company of Kanpur has applied under section 17 of the Companies Act for confirmation of an amendment sought to be introduced in the objects clause of its memorandum of association. The company is at present engaged in the manufacture of sugar in Champaran district (Bihar) and oil in a factory at Gutaiya in Kanpur district and also trades in oil-seeds and runs a cold storage depot at Gutaiya. Now it wishes to embark on a new business, viz., the manufacture of steel goods; and to this end it seek to introduce the following additional clause among the objects set forth in the memorandum of association: "To carry on trades and business of steel makers, re-rollers, foundrymen, steel fabricators (in all its branches and variations) and in particular as manufacturers of steel hoops (hot and cold roller), bars and rods, tool steel, gate channels, steel castings, etc., for sale on for internal consumption, iron founders, mechanical engineers, tool makers, brass founders, metal workers, boiler makers, mill wrights, machinists smiths and to buy, sell, manufacture, repair, convert, alter, let on hire and deal in plan, machinery, implements, rolling stock, conveyances, and hardware of all kinds."
(2.) A resolution recommending this amendment was passed unanimously at an extraordinary general meting of the shareholder so the company held on 12 February 1963. Notice has been issued to the creditors of the company but none has come forward to file any objection. The petition, however, is opposed by the Registrar of Companies on various grounds, which I now proceed to deal with seriatim.
(3.) The basic objection put forward by the Registrar is that the new business of manufacturing steel goods is a totally new departure for the company, having nothing in common with the existing business that is being carried on at present. But as pointed out in the case of In re Patent Tyre Company Ltd., (1923) 2 Ch 222 the mere fact that the additional business proposed to be undertaken by a company is a new departure is not fatal to a petition of this nature. The real question to be decided is whether the additional business is one which may conveniently or advantageously be combined with the existing business of the company. P.O. Lawrence, J., remarked: "The additional business, of course, must not be destructive of or inconsistent with the existing business: it must leave the existing substantially what it was before; but the additional business may be on e which is different for the original business and yet may well be capable of being conveniently and advantageously combined with the business which is being carried on. I think t would be placing altogether a too narrow construction upon section 9, to hold that, because the additional business involves a new departure which was not contemplated by the original memorandum, therefore it does to all within the purview of the section.";