• Companies (Court) Rules, 1959: Bare Act

  • PART I : GENERAL

    2. Interpretation.- In these Rules, unless the context or subject matter otherwise requires,-

    (1) 'The Act' means the Companies Act, 1956.

    (2) 'Advocate' means, in the case of a High Court having ordinary original jurisdiction, every person entitled to appear and plead in such jurisdiction of such High Court, and includes an Attorney of such Court, and in the case of every other High Court, every person entitled to appear and plead in such High Court, and in the case of a District Court, every person entitled to appear and plead in such Court:

    Provided that in respect of the service of notices and processes which under these rules may be served on an Advocate on behalf of any party, or the filing of an appearance on behalf of any party, 'Advocate' shall mean only a person entitled to act for a party under the rules of the Court, whether or not he is entitled also to plead.

    (3) 'Certified' means, in relation to a copy, certified as provided in section 76 of the Indian Evidence Act, 1872.

    (4) 'Code' means the Code of Civil Procedure, 1908.

    (5) 'Court' means the Court having jurisdiction under the Act.

    (6) 'Filed' means filed in the Office of the Registrar.

    (7) 'High Court' and 'District Court' means respectively the High Court and District Court having jurisdiction under the Act.

    (8) 'Judge' means, in the High Court, the Judge for the time being exercising the jurisdiction of the High Court under the Act, and in the District Court, the Judge of that Court exercising jurisdiction under the Act.

    (9) 'Judge's summons' means a summons returnable before the Judge in Chambers or in Court.

    (10) 'Prescribed' means prescribed by these Rules; and 'prescribed charges' and 'prescribed fees' means charges or fees prescribed by these Rules and where they are not so prescribed, prescribed by the Rules of the Court in respect of analogous matter in its other proceedings.

    (11) 'Registrar' means, in the High Court, the Registrar of the High Court, and includes the Prothonotary, Master and Assistant Master, and such other officer as may be authorised by the Chief Justice to perform all or any of the duties assigned to the Registrar under these Rules, and in the District Court, such officer of that Court as may be authorised by the High Court to perform all or any of the duties assigned to the Registrar under these Rules.

    (12) 'Reserve Bank' means the Reserve Bank of India and includes its branches and agencies.

    (13) 'The Rules' means these Rules, and includes the prescribed forms.

    (14) 'Sealed' means scaled with the seal of the Court.

    (15) 'Section' means section of the Act. Save as aforesaid, and unless the context otherwise requires, words and expressions contained in these Rules, shall bear the same meaning as in the Act, and the General Clauses Act, 1897 (X of 1897) shall apply for the interpretation of these rules as it applies for the interpretation of an Act of Parliament

    3. Proceedings to be neat and legible.- All petitions, applications, affidavits and other proceedings presented to the Court shall be written, typewritten, cyclostyled, or printed neatly and legibly on substantial paper of foolscape size, and separate sheets shall be stitched together. Numbers and dates shall be expressed in figures, and where dates given are not according to the English Calendar, the corresponding English dates shall also be given.

    4. Form of proceedings.- Every proceeding shall be dated and shall be instituted in the matter of the Companies Act, 1956, and in the matter of the company to which it relates. The contents shall be divided into separate paragraphs which shall be numbered serially. The general heading in all proceedings before the Court, and in all advertisements and notices, shall be in Form No. 1.

    6. Practice and procedure of the Court and provisions of the Code to apply.- Save as provided by the Act or by these Rules, the practice and procedure of the Court and the provisions of the Code so far as applicable, shall apply to all proceedings under the Act and these Rules. The Registrar may decline to accept any document which is presented otherwise than in accordance with these Rules or the practice and procedure of the Court.

    7. Power of Court to enlarge or abridge time.- The Court may, in any case in which it shall deem fit, extend or abridge the time appointed by these Rules or fixed by an order of the Court for doing any act or taking any proceeding, upon such terms (if any) as the justice of the case may require, and any such enlargement may be ordered although the application for the same is not made until after the expiration of the time appointed or allowed.

    8. Computation of time.- (a) Where any particular number of days not expressed to be clear days is prescribed, the same shall be reckoned exclusively of the first day and inclusively of the last day, unless the last day shall happen to fall on a day on which the offices of the Court are closed, in which case the time shall be reckoned exclusively of that day also and of any succeeding day or days on which the offices of the Court continue to be closed.

    (b) Where any particular number of days expressed to be clear days, is prescribed the same shall be reckoned exclusively of both the first and the last day.

    9. Inherent powers of Court.- Nothing in these Rules shall be deemed to limit or otherwise affect the inherent powers of the Court to give such directions or pass such orders as may be necessary for the ends of justice or to prevent abuse of the process of the Court.

    10. Applications how made.- Unless otherwise provided by these rules or permitted by the judge, all applications under the Act shall be made by a petition or by a Judge's summons as hereinafter provided.

    11. Petitions.- (a) The following applications shall be made by petition :

    (1) Applications under section 17 to confirm an. alteration of the memorandum of association.

    (2) Applications under section 79 to sanction issue of shares at a discount.

    (3) Applications under section 101 to confirm reduction of share capital.

    (4) Applications under section 107 to cancel any variation of the rights of holders of any class of shares.

    (5) Applications under section 141 for rectification of the register of charges.

    (6) Applications under section 155 for rectification of the Register of Members.

    (7) Applications under section 186 by a Director or Member of a Company for calling a meeting of the company.

    (8) Applications under section 203 to restrain a fraudulent person from managing companies, or for leave by a person restrained to be a director of, or to manage, a company.

    (9) Applications under section 237 for an order that the affairs of a company ought to be investigated.

    (10) Applications under section 391(2) to sanction a compromise or arrangement.

    (11) Applications under section 395(1) or 395(2) for the purpose of preventing, or settling the terms of, the acquisition by a transferee company of the shares of a dissenting shareholder.

    (12) Applications under section 397 for relief against oppression.

    (13) Applications under section 398 for relief in case of mismanagement.

    (14) Applications under section 407(1)(b) by a director, or manager, whose agreement is terminated for leave to act as the managing or other director or manager of the company.

    (15) Applications under section 439 for the winding-up of a company, or under section 583 for the winding-up of an unregistered company, or under section 584 for the winding-up of a foreign company.

    (16) Applications under section 517 to set aside an arrangement between a company about to be or in the course of being wound-up (voluntary) and its creditors.

    (17) Applications under section 522 to continue a voluntary winding-up subject to the supervision of the Court.

    (18) Applications for a declaration under section 542 (XI Schedule) in the course of proceedings under section 397 or 398 that a person who was knowingly a party to carrying on business in a fraudulent manner shall be personally liable for all or any of the debts or other liabilities of the company.

    (19) Applications by a creditor or member under section 543 (XI Schedule) in the course of proceedings under section 397 or 398, to enquire into the conduct of any of the persons mentioned in section, 543 (XI Schedule) and compel him to repay or restore any money or property to the company or pay compensation.

    (20) Applications under section 559 for declaring the dissolution of a company void.

    (21) Applications under section 560(6) to restore a company's name to the Register of companies.

    (22) Applications under section 579 to confirm the alteration in the form of the constitution of a company by substituting a memorandum and articles for a deed of settlement.

    (23) Applications under section 633(2) by an officer of a company for relief.

    (b) Judge's summons: - All other applications under the Act or under these rules shall be made by a Judge's summons, returnable to the judge sitting in Court or in Chambers as hereinafter provided

    12. Matters to be heard in open Court and in Chambers.- (a) The following matters shall be heard in open Court:- (1) Petitions.

    (2) Applications under section 43 for relief in case of default by a private company in complying with the provisions of its articles.

    (3) Applications under section 75(4) for relief in case of default in delivering documents to the Registrar of Companies.

    (4) Applications under section 89(3) for directions regarding termination of disproportionately excessive voting rights in existing companies.

    (5) Applications under section 250 for a direction, that shares or debentures shall cease to be subject to restrictions imposed by the Central Government under the said section.

    (6)[omitted] (7) [omitted]

    (8) Applications under section 391(1) for convening meetings of creditors and/or members of a company or any class of them.

    (9) Proceedings under section 394 for reconstruction or amalgamation of companies.

    (10) Public examination under section 478 or section 519.

    (11) Applications for a declaration under section 542 that a person who was knowingly a party to carrying on business in a fraudulent manner shall be personally liable for all or any of the debts or other liabilities of the company.

    (12) Applications under section 543 to enquire into the conduct of a promoter, director , etc., and compel him to repay or restore any money or property to the company or pay compensation.

    (13) Applications under section 545(1) for prosecution of delinquent officers and members of a company.

    (14) Applications under section 555(7) by a person claiming to be entitled to any money paid into the Companies Liquidation Account.

    (15) Applications for committal of any person for contempt.

    (16) Appeals from any act or decision of the Official Liquidator.

    (17) Applications relating to the admission or rejection of proofs.

    (18) Such other matters and applications as the Judge may from time to time by general or special order direct to be heard in open Court:

    Provided that the Court may, if it thinks fit, direct that the hearing or any part of the hearing of any of the said matters shall be held in Chambers.

    (b) Every other matter or application may be heard and determined in Chambers provided that the Judge may adjourn any such matter into Court.

    17. Forms.- The Forms set forth in Appendix I, where applicable, shall be used with such variations as circumstances may require.

    18. Affidavits.- (a) Every affidavit shall be drawn up in the first person and shall state the full name, age, occupation and the place of abode of the deponent. It shall be signed by the deponent and sworn to in the manner prescribed by the Code or by the rules and practice of the Court.

    (b) Every exhibit annexed to an affidavit shall be marked with the number of the proceeding, to which it relates, and shall be initialled and dated by the authority before whom it is sworn.

    (c) Except with the leave of the Judge, no affidavit having an interlineation, alteration or erasure, shall be filed in Court unless such interlineation or alteration is initialled by the authority before whom it is sworn, or, in the case of an erasure, the words and figures written on the erasure are rewritten in the margin and initialled by such authority.

    19. Form of Judge's summons and service thereof.- (1) A Judge's summons shall be in Form No. 2 and shall, unless otherwise provided by these rules or permitted by the Judge, be supported by an affidavit.

    (2) The summons, together with a copy of the affidavit, shall be served upon every person against whom an order is sought and such other person as the Judge may direct, in person or by pre-paid registered post, or upon his Advocate; where he appears by Advocate, or in such other manner as the Judge may direct.

    (3) Unless otherwise provided by these rules or by an order of Court, a summons which is an interlocutory application in a proceeding, shall be served not less than 4 clear days before the day named in the summons for the hearing thereof, and where the summons is other than interlocutory, it shall be served not less than fourteen days before the date fixed for the hearing thereof

    20. Issue of summons.- Every summons, together with duplicates of the same for service thereof, shall be prepared by the applicant or his Advocate and issued from the office of the Registrar.

    21. Affidavit verifying petition.- Every petition shall be verified by an affidavit made by the petitioner or by one of the petitioners, where there are more than one, and in the case the petition is presented by a body corporate, by a director, secretary or other principal officer thereof; such affidavit shall be filed along with the petition and shall be in Form No. 3 :

    Provided that the judge or Registrar may, for sufficient reason, grant leave to any other person duly authorised by the petitioner to make and file the affidavit.

    22. Enclosures to petition.- Unless dispensed with by the Judge or Registrar, every petition and application mentioned in Appendix II hereof, shall be accompanied by the documents set opposite thereto in column 4 of the said Appendix. [Note.- Where the minute book of the company is required to be produced, a copy of the relevant minute, certified by the company to be a true copy, may be filed along with the minute book, and after the copy has been checked with the original, the Registrar may return the minute book to the company on its undertaking to produce the same when required. Before returning the minute book, the Registrar shall initial the relevant page or pages of the book for subsequent identification.]

    23. Summons for directions.- (a) Where a petition is presented under paragraphs (1), (3), (4), (22) and (23) of rule 11, an application shall, in every case, be made by summons to the Judge in Chambers for directions as to the advertisement of the petition, the notices to be served and the proceedings to be taken. Except where, in any particular case, a different form is prescribed by these Rules, such summons shall be in Form No. 4.

    (b) The summons shall be posted for hearing before the Judge in Chambers at the next Chamber sittings, and the Judge may make such orders thereon and may give such directions as may seen to him appropriate.

    (c) No summons for directions shall be necessary in the case of other petitions, but the petition shall, upon admission, be placed before the Judge in Chambers for fixing the date of hearing and directions as to the advertisement of the petition and the notices to be served, and such other directions as may be necessary.

    24. Advertisement of petition.- (1) Where any petition is required to be advertised, it shall, unless the Judge otherwise orders, or these rules otherwise provide, be advertised not less than fourteen days before the date fixed for hearing, in one issue of the Official Gazette of the State or the Union Territory concerned, and in one issue each of a daily newspaper in the English language and a daily newspaper in the regional language circulating in the State or the Union Territory concerned, as may be fixed by the Judge.

    (2) Except in the case of a petition to wind-up a company, the Judge may if he thinks fit, dispense with any advertisement required by these Rules.

    25. Contents of advertisement.- Except as otherwise provided in these rules, such advertisement shall be in Form No. 5, and shall state the date on which the petition was presented, the name and address of the petitioner and his advocate, the nature of the petition and the date fixed for hearing. It shall, unless otherwise ordered, further state that any person who intends either to oppose or support the petition at the hearing should send notice of his intention to the petitioner or his advocate so as to reach him not later than two days previous to the day fixed for the hearing, and in the case of a petition for winding-up, not later than 5 days previous to the day fixed for the hearing of the petition.

    26. Service of petition.- Every petition shall be served on the respondent, if any, named in the petition and on such other persons as the Act or these rules may require or as the Judge or the Registrar may direct. Unless otherwise ordered, a copy of the petition shall be served along with the notice of the petition.

    27. Notice of petition and time of service.- Notice of every petition required to be served upon any person shall be in Form No. 6, and shall, unless otherwise ordered by Court or provided by these Rules, be served not less than 14 days before the date of hearing: Provided always that such notice when by the Act or under these Rules is required to be served on the Central Government, the same shall, unless otherwise ordered by the court, be served not less than 28 clear days before the date of hearing.

    28. Service on company.- (1) Where a petition is presented against a Company, it shall be accompanied by a notice of the petition in the prescribed Form together with a copy of the petition for service on the company and an envelope addressed to the company at its registered office or its principal place of business and sufficiently stamped for being sent by registered post for acknowledgement. The Registrar shall immediately on the admission of the petition send the notice together with the copy of the petition to the company by registered post.

    (2) Every petition and, save as otherwise provided by these Rules or by an order of Court, every application, shall, unless presented by the Company, be served on the company at its registered office, or if there is no registered office at its principal or last known principal place of business, by leaving a copy thereof with an officer or employee of the company, and in case no such person is available, in such manner, as the Judge or Registrar may direct, or, by sending a copy thereof by prepaid registered post addressed to the company at its registered office, or, if there is no registered office, at its principal or last known principal place of business, or to such person and at such address as the Judge or Registrar may direct.

    Where the company is being wound-up, the petition or application shall also be served on the liquidator, if any, appointed for the purpose of winding-up the affairs of the company.

    29. Petitioner to effect service.- Save as otherwise provided by these Rules and subject to any directions of the Judge or Registrar, the petitioner, applicant or any other person having the conduct of proceedings in Court, shall be responsible for the service of all notices, summons and other processes and for the advertisement and publication of notices, required to be effected by these Rules or by order of Court.

    30. Affidavit of service.- (1) An affidavit or affidavits stating whether the petition has been advertised as prescribed by rule 24 and whether the notices, if any have been duly served upon the persons required to be served shall be filed not less than 3 days before the date fixed for hearing. Such proof of the advertisement or of the service, as may be available, shall be filed along with the affidavit.

    (2) An affidavit of service on a company or its liquidator shall be in Form No. 7 or 8 as the case may be.

    31. Procedure on default of compliance as regards advertisement and service of notice.- In default or compliance with the requirements of the Rules or the directions of the Judge or Registrar, as regards the advertisement and service of the petition, the petition shall, on the date fixed for hearing be posted for orders of the Judge and the Judge may either dismiss the petition or give such further directions as he thinks fit.

    32. Mode of service and service when deemed to be effected.- (1) Save as otherwise provided by these Rules or by an order of Court, all notices, summonses, and other documents required to be served on any person, may be served either personally by delivering a copy thereof to such person, or upon his advocate where he appears by advocate or, except where personal service is required, by pre-paid registered post for acknowledgement due addressed to the last known address of such person. In the case of service by registered post where no acknowledgement signed by the addressee or his duly authorised agent is received, orders of Court shall be obtained as to the sufficiency of service or as to the further steps to be taken for service as the Court may direct:

    Provided that where a notice, summons or other document has to be served on any class of persons such as shareholders, debenture holders, creditors and the like, the same may be sent by pre-paid registered post, or by ordinary post under certificate of posting, as may be provided by these Rules or by an order of Court, and unless otherwise ordered by the Court, the service shall be deemed to be effected at the time when the said notice, summons or other documents ought to be delivered in the ordinary course of post by the post office, and notwithstanding the same is returned undelivered by the post office.

    (2) Where notice of any petition, application, summons or other proceeding has to be given to the Central Government under these rules, it shall be addressed to and served on the Secretary to Government of India, Department of Company Law Administration, New Delhi, or such other officer as the Central Government may authorise to receive notices on its behalf.

    (3) Where any person has to be served at an address outside India, the notice or other process to be served on him shall, subject to orders of the Court, be sent to such address by pre-paid air-mail registered post for acknowledgment due.

    33. Validity of service and of proceedings.- No service under these Rules shall be deemed invalid by reason of any defect in the name or description of a person in the list of contributories or in the petition, summons, notice or other proceeding. provided that the Court is satisfied that such service is in other respects sufficient; and no proceedings under the Act or these Rules shall be invalidated by reason of any formal defect or irregularity, unless the Judge before whom the objection is taken is of the opinion that substantial injustice has been caused by such defect or irregularity and that the injustice cannot be remedied by an order of Court.

    34. Notice to be given by persons intending to appear at the hearing of petition.- Every person who intends to appear at the hearing of a petition, whether to support or oppose the petition, shall serve on the petitioner or his advocate, notice of his intention at the address given in the advertisement. The notice shall contain the address of such person, and be signed by him or his advocate, and save as otherwise provided by these Rules shall be served (or if sent by post, shall be posted in such time as to reach the addressee) not later than two days previous to the day of bearing, and in the case of a petition for winding-up, not later than five days previous to the day of hearing. Such notice shall be in Form No. 9, with such variations as the circumstances may require, and where such person intends to oppose the petition, the grounds of his opposition, or a copy of his affidavit, if any, shall be furnished along with the notice. Any person who has failed to comply with this Rule shall not, except with the leave of the Judge, be allowed to appear at the hearing of the petition.

    35. List of persons, intending to appear, to be filed.- The petitioner or his advocate shall prepare a list of the names and addresses of the persons who have given notice of their intention to appear at the hearing of the petition. Such list shall be In Form No. 10, and shall be filed in Court before the hearing of the petition.

    36. Procedure at hearing of petition.- At the hearing of the petition, the Judge may either dispose of the petition finally, or give such directions as may be deemed necessary for the filing of counter affidavits and reply affidavits, if any, and for service of notice on any person who, in his opinion, has been omitted to be served or has not been properly served with the notice of the petition and may adjourn the petition to enable the parties to comply with his directions. Except as otherwise ordered by the Judge, it shall not be necessary to give notice of the adjourned hearing to any person.

    PART II : PROCEEDINGS IN MATTERS OTHER THAN WINDING-UP

    Confirmation of alteration of memorandum of a company. [Sections 17 to 19]

    38. Form of petition under section 17 and Summons for directions.- A petition under section 17 to confirm an alteration of the memorandum of a company shall set out succinctly particulars of its registration, its share capital where it has a share capital, the original objects and the alterations proposed to be effected, the passing of the special resolution and the reasons for the alteration, the debentures, if any, issued by the company and its present financial position. The petition shall be in Form No. 11. It shall be accompanied by a summons for directions and shall be supported by an affidavit in Form No. 12.

    39. Directions at hearing of summons.- Upon the hearing of the summons for directions, the Court shall give such directions as it may think fit for the advertisement of the petition, and the service of notices on the debenture holders and creditors of the company, if any, and such other persons whose interests will, in the opinion of the Court, be affected by the alteration. The order on the summons shall be in Form No. 13. The notice shall be in Form No. 14. Where the Court thinks fit to dispense with the notice required by section 17(3)(a) in the case of any person or class of persons it shall record its reasons for doing so.

    40. Notice to Registrar of Companies and Central Government.- Notice of the petition and the date of the hearing thereof shall in every case be given to the Registrar of Companies, and where the petitioner is a limited company, registered without the word 'limited' under section 25, such notice shall also be given to the Central Government.

    41. Procedure where creditors are entitled to object.- Where the Court is of the opinion that the creditors or any class of them are entitled to object to the proposed alteration, the Court may give such directions as it may think fit with respect to the settlement of the list of creditors, service and publication of notices hearing of objections and the adjudication of claims, etc., and the provisions of rules 49 to 61 of these rules applicable in respect of a petition for confirming the reduction of share capital, shall, if the Court so directs, and to the extent specified in such direction apply with such variations as may be necessary.

    42. Order confirming alteration.- An order confirming an alteration in the memorandum of association shall be in Form No. 15 with such variations as may be necessary. Confirmation of Alteration in the Constitution of a Company.

    43. Petition under section 579.- A petition under section 579 to confirm an alteration in the constitution of a company by substituting a memorandum and articles for a deed of settlement shall be in Form No. 16, and rules 38 to 42 relating, to a petition under section 17 shall apply mutatis mutandis to a petition under section 579. 2Issue of Shares at a Discount (Section 79).

    ISSUE OF SHARES AT A DISCOUNT [Section 79]

    44. Petition for sanctioning the issue of shares at a discount.- A petition under section 79 to sanction the issue of shares at a discount, shall be in Form No. 17, and where the rate of discount proposed is higher than ten per cent, it shall be accompanied by the order of the Central Government sanctioning the higher rate in addition to the documents set out in Appendix II.

    45. Order sanctioning issue to be delivered to Registrar of Companies.- Unless in any particular case the Court shall otherwise direct, every order sanctioning the issue of shares at a discount shall contain a direction that a certified copy of such order be delivered to the Registrar of Companies for registration within one month from the date of the order, and that the order shall not take effect until such certified copy has been so delivered.

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