Sri PRITISH KOLLATI V. Union Of India

WP/17485/2020

AI Insights

The case revolves around the disqualification of the petitioner, Sri Pritish Kollati, as a director under Section 164(2)(a) of the Companies Act, 2013, due to alleged non-filing of financial statements and annual returns for three consecutive years. The petitioner challenged the disqualification and the subsequent deactivation of his DIN, arguing that the action was arbitrary, illegal, and violated principles of natural justice and constitutional rights under Articles 14 and 19(1)(g). The court examined whether the disqualification could be applied retrospectively and whether the DIN could be deactivated based on the grounds cited. The court found that the disqualification and DIN deactivation were improperly applied retrospectively and without proper legal basis, leading to the decision to set aside these actions.

• Counselvise Citation: [2020] 140 COUNSELVISE.COM (IT) 736786 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 06-10-2020
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax (Central) v. Vatika Township Private Limited, Yashodhara Shroff v. Union of India, Gaurang Balvantlal Shah s/o Balvantlal Shah v. Union of India, Bhagavan Das Dhananjaya Das v. Union of India
• Laws Referred To: Companies Act, 2013, Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: NAMAVARAPU RAO
• Assessee Lawyers: T SRIHARI BABA
• Keywords: Annual Returns; Companies Act; Director Identification Number; Disqualification; Financial Statements; Natural Justice
• Section: 226; 248; 252; 164(2)(a); 164(4)(a)

Judgement Text

"H,GH COURT FOR . ATI (.,\"., ; i b'il[','iflJ,[?::, ::; ^ \" \" ^' ^ TUESDAY, THE SIXTH DAY OF OCTOBER TWo THoUSAND AND rweruri--.. PRESENT THE HONOURABLE SRI .JUSNCE CHALLA KODANDA RAM Sri Pritish Kollati, s/o. prasad, Rao.Ko ati prot No.34, Rukminidevi corony Annexe Aoc 3;.;;A,-n#\"., l .rar.edpaly r!enr,., Nasai'au.\"rno!,Zoril i;oo ozo ii!\"^d\";; il;;D. AND ...PETIT|oNER l Union of India. The rt/inistry of corporate Affairs Represented bv its seoretarv A. ^ Wing-. Shastri Bhawan, Rajendra prasad Road, Ne* Oeini'_\"ir-d o'ir\"\"\" \"\" , 2 The Regrstrar of Q6p1p26i!s, Andhra pradesh ana ietangrnu, ); 'Floor, g^olp-ol?te Bhawan, GSI post, Tattianaram, Nagole, Band\"taguda, Hyderabad - 500 068 ..,RESPONDENTS 1 & 2 Betwee n WRIT PETIT toN NO: 1748s oF 2020 Petition under Niicle 226 of the constitution of lndia praying that in the circumstances stated in the affidavjt filed therewith, the High court may be pleased to issue any appropriate writ, order or direction more particularly in the nature of a writ of l ,4andamus. a. declaring the action of the Respondents in disqualifying the Petitioner invoking Section t 6a(2) (a) as arbitrary, illegal, contrary to the principles of natural justice, in violation of the provisions of the Companies Act, 2013 and ln contravention of the rights guaranteed under Artlcle 14 and Article 19 (1 ) (g) of the Constitution of lndia and consequently direct the Respondents to restore the DIN of Petitioner being DIN 03526901. That the list of directions passed by the l ,4inistry of Corporate Affairs (tVCA) on the website .i.e. www.mca.gov.in as arbitrary iilegal without jurisdiction, contrary of the provisions of the Companies Act 2013 as RLr e 1 1 of the Companies (Appointment of Directors) Rules 2014 violate the principles of natural justice besides violating the rights guaranteed under the Article 14 and Article 19 (1 ) (g) of the Constitutions of India and quash /set aside the same to the extent t declares /treats the petitioner as disqualified in terms of section 164(2Xa) of the Companies Act 2013 in the interest of justice. b. That the petitioner is not disqual fied in terms of section 164(4)(a) of the Companies Act 20'1 3 for the reason of the allegeC default of non-filing of Annual Returns and financial statements with the by company Petition under Section 151 CPC praying that in the circumstances stated in the affidavit flled in support of the petition, the High Court may be pleased to direct the respondents to restore the DIN of the Petitioner No,03526901 as to enable the Petitioner to comply with statutory requirements such as filing of annual returns and other related documents for the companies which are active in which petitioner is also drrector, pending disposal of the writ petition. Counsel for the Petitioner: SRI T.SRIHARI BABA Cou nse I for the Respondents SRI NAMAVARAPU RAJESHWAR RAO Assistant Solicitor General The Court made the following: ORDER lA NO: 1 OF 2020 THE HON,BLE SRI JUSTICE CHALLA KODANDA RAM WRIT PETITION No. 17485 of 2020 ORDEB: The petltioner challenges his disqur-rlilicatiotl frotll Directorship under Section 164 2) of the Companies Act' 2013' lirr the allegcd defar-rlt in filing financial statement/Allnual Retltrlts' ancl consequently seek restoration of his Director ldentificatir;lt N\"umber (DIN) viz., 0352690 1 . Learned counsel raised in the present common order iiated batch. lbr the petltioner submits thal thc issr-Lc Writ Petilion is squarelv covertrd b1' tlrc 18.07.2019 in W.P.No,5'122 o1'2018 aricl Learned Standing Counsel lor the 2'd respondent - Registrar ol Companies does not dispr-rte the aforesaicl submission. Operative portion of the aforesaid ordcr reads ers urrclt:r' \"For the foregoing reasons, the impugned orders in the writ petitions to the extent of disqualifying the petitioners under Section l64l2llal of the Act and deactivation of their DINS, are set aside, and the 2\"d .espondent is ditected to activate the DINS of the petitioners, enabling them to function as Directors other than in strike off companies. It is made clear that this order will not preclude the 2nd respondent from taking appropriate action in accordance with law for violations as envisaged under Section 76412) of the Act, giving the said provision prospective effect from O1.O4.2O14 and for necessary action against DIN in case of violations of Rule l.1 of the Rules. It is also made clear that if the petitioners are aggrieved by the action of the respondents in striking off their companies under Section 248 of the Act, they are at liberty to avail alternative remedy under Section 252 of the Act. To All the writ petitions are extent indicate d above.,, accordingly allowed to the In vieu, ol the said Order dated 18.07.20 19 and for rh,- reasons recorded therein, this Writ petition is also ailog.ed ir.r terms therr:ol'. No costs Miscellaneous petitlons, if any stand closed SD/-K.AMMAJI ASSISTAN,T REG,ISTRAR ,rRUE copy/, C,{l CU> SECTION OFFICER 1. The Secretary, The N,4inistry of Corporate Affairs Union of lndia, A Wing, Shastri Bhawan, Rajendra Prasad Road, New Delhi - 110 011 2. The Registrdr of Companies, Andhra Pradesh and Telangana, 2.c Floor, Corporate Bhawan, GSI Post, Tattianaram, Nagole, Bandlaguda, Hyderabad - 500 068 3 One CC to Sri T.Srihari Baba, Advocate [OPUC] 4. One CC to Sri Namavarapu Rajeshwar Rao, (Assistant Solicitor General) IOPUC] 5. Two CD Copies (along with the copy of the order daled 18107120 '19 in WP No.5422 of 2018 atrd batch) KJ 1 -/) HIGH COURT DATED:06 t1012020 ORDER WP.No.17485 of 2020 ALLOWING THE WRIT PETITON WITHOUT COSTS. [)1 1; .i 17 0cT2A0 t l4 E tl s 1 R o t (,( t' z { PATc * I .L o ,w, 1 -.-.- THE HON'BLE SRI JUSTICE A.RAJASHEKER REDDY W. P. NOs.542 2, 12L84, 135 20, L37 83, 13855, 14L66, 24051, 30993, ANp 409s3 0F 2018, ss47. ss82. s669. s687. 5785.6047. 6087. 6L40. 6484. 6753. 6858, 695A, 69AL. 700L.700a,7014. 7046.7069, Ql I I err? Q