The Court allowed the writ petition, holding that under the precedent in Meethelaveetil Kaitheri Muralidharan, the Registrar of Companies lacks the power to deactivate a Director Identification Number (DIN). The petition was dismissed as no longer res integra.
The writ petition was allowed, impugned order quashed, and DIN reactivated as per precedent.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 25.01.2022
CORAM:
THE HON'BLE MR.JUSTICE M.DHANDAPANI
W.P.NO.895 OF 2022 AND W.M.P.NOS.981 & 982 OF 2022
Mr.Ganesan Harinarayanan
...Petitioner
Vs
Writ petition filed under Article 226 of the Constitution of India praying for a writ of certiorarified mandamus calling for the records of the 2nd respondent relating to the impugned order dated 13.12.2019 uploaded in the website of the 1st respondent insofar as the petitioner herein is concerned, quash the same as illegal, arbitrary and devoid of merit and consequentially direct the respondents herein to permit the petitioner(having DIN No.-05261489) to get re-appointed as Director in the Company or appointed in any other company without any hindrance.
The prayer made in this writ petition is to issue a writ of certiorarified mandamus to call for the records of the impugned order dated 13.12.2019 uploaded on the website of the 1st
respondent insofar as the petitioner herein is concerned and quash the same and to consequentially direct the respondents herein to permit the petitioner to get re-appointed as Director in the company or appointed in any other company without any hindrance.
3.Today, when the matter was taken up for consideration, the learned counsel appearing for the parties jointly submitted that the issue involved herein is no longer res integra. Earlier, this Court by order dated 03.08.2018 in WP.No.25455 of 2017 etc. batch, in Bhagavan Das Dhananjaya Das case reported in (2018) 6 MLJ 704, allowed those writ petitions and set aside the orders dated 08.09.2017, 01.11.2017, 17.12.2018, etc. passed by the Registrar of Companies, disqualifying the petitioners therein to hold the office of directorship of the companies under Section 164(2)(a) of the Companies Act, which came into effect from 01.04.2014. Thereafter, yet another set of disqualified directors approached this court by filing WP.No.13616 of 2018 etc. batch (Khushru Dorab Madan v. Union of India) which were dismissed by order dated 27.01.2020. The said order of the learned single judge was challenged by some of the petitioners therein before the Division Bench of this Court in W.A.No.569 of 2020, etc. batch (Meethelaveetil Kaitheri Muralidharan v. Union of India, 2020 SCC OnLine Mad 2958 : (2020) 6 CTC 113), which after elaborately dealt with the issue as to whether the RoC is entitled to deactivate the Director Identification Number (DIN), allowed those writ appeals on 09.10.2020, the relevant passage of which, are profitably, extracted below:
"41. As is evident from the above, Rules 9 and 10 deals with the application for allotment of DIN. Rule 10(6) specifies that the DIN is valid for the life time of the applicant and shall not be allotted to any
other person. Rule 11 provides for the cancellation or surrender or deactivation of the DIN. It is very clear upon examining Rule 11 that neither cancellation nor deactivation is provided for upon disqualification under Section 164(2) of CA 2013. In this connection, it is also pertinent to refer to Section 167(1) of CA 2013 which provides for vacating the office of director by a director of a Defaulting Company. As a corollary, it follows that if a person is a director of five companies, which may be referred to as companies A to E, if the default is committed by company A by not filing financial statements or annual returns, the said director of company A would incur disqualification and would vacate office as director of companies B to E. However, the said person would not vacate office as director of company A. If such person does not vacate office and continues to be a director of company A, it is necessary that such person continues to retain the DIN. In this connection, it is also pertinent to point out that it is not possible to file either the financial statements or the annual returns without a DIN. Consequently, the director of Defaulting Company A, in the above example, would be required to retain the DIN so as to make good the deficiency by filing the respective documents. Thus, apart from the fact that the AQD Rules do not empower the ROC to deactivate the DIN, we find that such deactivation would also be contrary to Section 164(2) read with 167(1) of CA 2013 inasmuch as the person concerned would continue to be a director of the Defaulting Company.
disqualified directors by the ROC and the deactivation of the DIN of the Appellants is hereby quashed. As a corollary to our conclusion on the deactivation of DIN, the DIN of the respective directors shall be reactivated within 30 days of the date of receipt of a copy of this order. Nonetheless, we make it clear that it is open to the ROC concerned to initiate action with regard to disqualification subject to an enquiry to decide the question of attribution of default to specific directors by taking into account the observations and conclusions herein. No costs. Consequently, connected miscellaneous petitions are closed."
4.Therefore, following the aforesaid decision, the writ petition stands allowed, in the terms as indicated in the judgement in Meethelaveetil Kaitheri Muralidharan's case. No costs. Consequently, connected miscellaneous petitions are closed.
Sd/-
Assistant Registrar(CS-IX)
//True Copy//
Sub Assistant Registrar
skt
To
W.P.No.895 of 2022 and W.M.P.Nos.981 & 982 of 2022
NMI(CO) RLP(09/02/2022)
2 issues framed by the court
Whether the Registrar of Companies should reactivate the Director Identification Number (DIN) of directors disqualified under Section 164(2)(a) of the Companies Act, 2013 following the precedent in Me
Whether the petitioner, previously disqualified under Section 164(2)(a), is entitled to be re-appointed as a director without hindrance.
Colour shows how this judgement treated each authority
Bhagavan Das Dhananjaya DasReferred¶17
Bhagavan Das Dhananjaya Das case reported in (2018) 6 MLJ 704
Khushru Dorab MadanReferred¶17
Khushru Dorab Madan v. Union of India
Meethelaveetil Kaitheri MuralidharanFollowed¶17
Meethelaveetil Kaitheri Muralidharan v. Union of India, 2020 SCC OnLine Mad 2958 : (2020) 6 CTC 113 · Who else cites this
1 provisions across 1 enactments
Mr. Ganesan Harinarayanan
Union of India
The Registrar of Companies
M. Dhandapani
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
