DEVAS MULTIMEDIA PRIVATE LTD. versus ANTRIX CORPORATION LTD. & ANR

Citation: [2022] 11 S.C.R. 291 · Decided: 17-01-2022 · Supreme Court of India · Bench: HEMANT GUPTA · Disposal: Dismissed

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Judgment (excerpt)

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   [2022] 11 S.C.R. 291
DEVAS MULTIMEDIA PRIVATE LTD.
v.
ANTRIX CORPORATION LTD. & ANR.
(Civil Appeal No.5766 of 2021)
JANUARY 17, 2022
[HEMANT GUPTA AND V. RAMASUBRAMANIAN, JJ.]
Company Law – Winding up of a company – Fraud as a
ground for winding up – Distinguishing features between Companies
Act, 1956 and Companies Act, 2013, with regard to question of
availability of fraud as a ground for winding up of a company –
Discussed – Held: The main departure of the Companies Act, 2013
from the statutory regime of the Companies Act, 1956, is the specific
inclusion of fraud, directly as one of the circumstances in which a
company could be wound up – s.271 of the 2013 Act lists out the
circumstances in which a company may be wound up – Fraud has
now directly become (under the 2013 regime), one of the
circumstances in which a company could be wound up, though it
also continues to be a ground indirectly, u/s 224(2) r/w section 213
[as it was under Section 439(1) (f) r/w sections 243 and 237(b) of
the 1956 Act] – Companies Act, 2013 – s.271 – Companies Act,
1956.
Company Law – Winding up of a company – Fraud as a
ground for winding up – Petition u/s.271(c) of the Companies Act,
2013 – Advertisement of the company petition – Breach of – On
facts, petition for winding up was never advertised nor even ordered
to be advertised, either upon admission of the petition or anytime
thereafter – Contention of appellants that this vitiated the whole
proceedings – Held: Sub-sections (1) and (2) of s.468 of the 2013
Act empower the Central Government to make Rules providing for
all matters relating to winding up of companies – In exercise of the
powers so conferred, the Companies (Winding up) Rules, 2020 were
issued – Since requirement to advertise a petition for winding up is
stipulated in rr. 5 and 7 of the Companies (Winding up) Rules, 2020,
what is prescribed in r.35 of the NCLT Rules 2016 would cover
even petitions for winding up – Sub-rule (5) of r.35 makes it clear
that even in cases where direction of the Tribunal as regards
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SUPREME COURT REPORTS
[2022] 11 S.C.R.
advertisement has not been complied with, the Tribunal has an option
(i) either to dismiss the petition; or (ii) to give such further directions
as it may think fit – Sub-rule (6) of r.35 confers power upon the
Tribunal even to dispense with any advertisement – Thus, what was
not specifically available in black and white, under the 1956
statutory regime, namely the power to dispense with any
advertisement, is now made available specifically under the statutory
regime of 2013 – In the case at hand, the company in liquidation
did not have any creditors or customers who had dealings with the
company – There were no stakeholders prejudiced by failure of
NCLT to order publication of advertisement of the petition – This
was not a case where the company was sought to be wound up on
ground of inability to pay debts or on just and equitable ground –
This was a case of fraud and all stakeholders were fully aware of
the winding up proceedings – Therefore, failure of the Tribunal to
order publication of an advertisement did not render the entire
proceedings unlawful – Companies Act, 2013 – s.271(c) and 468 –
Companies Act, 1956 – Companies (Winding up) Rules, 2020 – rr.5
and 7 – National Company Law Tribunal Rules, 2016 – r.35.
Company Law – Winding up of a company – Petition u/
s.271(c) of the Companies Act, 2013 – Challenged, for being barred
by limitation – Held: Limitation is not always akin to a lighted
matchstick to a train of gun powder – The date of commencement
of the period need not necessarily be static – The date of
commencement may keep changing depending upon the acts of
omission and commission on the part of the party against whom the
action is initiated – If the conduct of the affairs of the company in
a fraudulent manner is a continuing process, the right to apply
becomes recurring – In the case at hand, fraud and corruption
were discovered only later and by the time the discovery was made,
the attempts to reap the fruits of fraud had reached the pinnacle –
These attempts continue even till date and this falls squarely within
s.271(c) – Therefore, the contention that the petition was barred by
limitation was rightly rejected by the Tribunal – Companies Act,
2013.
Company Law – Winding up of a company – Fraud as a
ground for winding up – Petition under s.271(c) of the Companies
Act, 2013 – Challenge to – On ground of estoppel 

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