CORPORATION BANK Vs. REGISTRAR OF COMPANIES

JUDGEMENT

(1.) THE Corporation Bank (hereinafter referred to as "the petitioner") has filed this petition under Section 141 of the Companies Act, 1956 (hereinafter referred to as "the Act"), seeking extension of time for filing the particulars of modification of charge executed with Dhanalakshmi Consolidated Industries Limited (hereinafter referred to as "the company").

(2.) The facts alleged in the petition are that the company borrowed a sum of Rs. 50 lakhs from the petitioner against the security of vehicles, machinery and equipment belonging to the company which were to be let out by the said company to any party on hire or lease, by executing ah hypothecation agreement dated February 12, 1987, and the same was duly registered with the Registrar of Companies, Tamil Nadu, Madras. The said charge was modified by executing two hypothecation agreements both dated May 20, 1988, by hypothecating (a) all the movables belonging to the company both existing and proposed to be purchased and thereby creating a floating charge and (b) all the present as well as the future book debts, outstanding monies, receivable claims, bills, contracts, engagements, securities, investments, etc., by way of first charge. The said modification of charges should have been filed with the Registrar of Companies as required under Section 135 of the Act within 30 days after execution. The second opposite party ("the company") failed to submit Form No. 8 in spite of repeated requests by the petitioner. Under these circumstances, the petitioner was obliged to file the relevant Form No. 8 with the Registrar of Companies, Tamil Nadu, Madras, on March 20, 1989, after a delay of nine months. In view of the delay in filing the modification of charge, the Registrar of Companies did not take the same on record. Hence, this petition had been filed by the petitioner seeking extension of time to file the charges as envisaged under Section 141 of the Act.

(3.) THE Syndicate Bank (hereinafter referred to as "SB"), has in its objection stated that it has created a charge for over Rs. 5 crores on certain valuable properties of the company and the extension of time if granted in this case, would adversely affect the SB. It has also submitted that under Section 135 of the Act it is only the company which is entitled to register a charge and not the petitioner. THE company has also objected to the granting of extension of time, on the ground that the petitioner has already filed a winding up petition against the company in 1988 and the company has also filed a suit seeking certain declarations, against the petitioner. Further, the hypothecation agreements dated May 20, 1988, which are sought to be registered were not executed on the said date as there was nothing to warrant such executions of such documents. It is further averred that these documents have probably been obtained in blank forms while other documents were executed and the company never intended to create any fresh charge over any assets other than those that have already been given as security earlier. Accordingly, the company has prayed for dismissal'of the petition.