Study on Section 146 of the Companies Act 1956

Study on Section 146 of the Companies Act, 1956 (Registered Office)

Every company registered under the Companies Act, 1956 be it public or private, is required to have a registered office. 

A. Section 146 of the Companies Act 1956 is considered while deciding the territorial jurisdiction of the Courts or not?

On analyzing section 146 (Registered Office of the Company) of the Companies Act 1956 as stated below the following conclusions can be drawn:

-         The section primarily speaks about the formation of the registered office alone.

-         The section does not speak about the territorial jurisdiction.

-    Hence during the time of disputes while analyzing the territorial jurisdictions the following  sections are considered:

Nature of dispute	Section to be considered
Dispute arises at the registered office of the company	Section 10 of the Companies Act 1956.
Dispute arises in any other place other than the registered office of the company	Section 10 of the Companies Act 1956 or Section 20 of the Civil Procedure Code 1908

Case study:

Areva T&D; India Ltd. vs Power Grid Corp. Of India Ltd. on 13 June, 2008

(Punjab – Haryana High Court)

B. When the company functions from an address other than the address mentioned as registered office in the annual report, is there violation of section 146 of the Companies Act 1956 if : 

On reading section 146 of the Companies Act 1956 the following conclusion is drawn:

-       Mere mention of an address as the office of the company in the annual report shall not make   it as the registered office of the company if it is different from the one available in the ROC records.

-  Any difference in the address of the registered office communicated to the ROC and mentioned in the return, report, certificate, balance-sheet, prospectus, statement or other document as required by or for the purposes of any of the provisions of this Act, then it amounts to violation of section 146 and provisions of Section 628 (Penalty for false statement) of the companies act may be attracted.

-     For the purpose of analyzing the officer in default under section 146 of the Companies Act 1856, Section 5 of the Companies Act 1956 is considered.

Case Study: 

Vijay Kumar Gupta And Ors. vs Registrar Of Companies And Ors. on 4 March, 2003

(Himachal Pradesh High Court)

Section 5 of the Companies Act (Officer in Default) states as follows:

For the purpose of any provision in this Act which enacts that an officer of the company who is in default shall be liable to any punishment or penalty, whether by way of imprisonment, fine or otherwise, the expression "officer who is in default" means all the following officers of the company, namely:-

(a) the managing director or managing directors;

(b) the whole-time director or whole-time directors;

(c) the manager;

(d) the secretary;

(e) any person in accordance with whose directions or instructions the Board of directors of the company is accustomed to act;

(f) any person charged by the Board with the responsibility of complying with that provision:

Provided that the person so charged has given his consent in this behalf to the Board;

(g) where any company does not have any of the officers specified in clauses (a) to (c), any director or directors who may be specified by the Board in this behalf or where no director is so specified, all the directors:

Provided that where the Board exercises any power under clause (f) or clause (g), it shall, within thirty days of the exercise of such powers, file with the Registrar a return in the prescribed form.

Section 146 of the Companies Act (Registered Office of the Company) states as follows:

(1) A company shall, as from the day on which it begins to carry on business, or as from the thirtieth day after the date of its incorporation whichever is earlier, have a registered office to which all communications and notices may be addressed.

(2) Notice of the situation of the registered office, and of every change therein, shall be given within thirty days in Form 18 after the date of the incorporation of the company or after the date of the change, as the case may be, to the Registrar who shall record the same:

Provided that except on the authority of a special resolution passed by the company, the registered office of the company shall not be removed:-

(a) in the case of an existing company, outside the local limits of any city, town or village where such office is situated at the commencement of this Act, or where it may be situated later by virtue of a special resolution passed by the company; and

(b) in the case of any other company, outside the local limits of any city, town or village where such office is first situated, or where it may be situated later by virtue of a special resolution passed by the company.

(3) The inclusion in the annual return of a company of a statement as to the address of its registered office shall not be taken to satisfy the obligation imposed by sub-section (2).

(4) If default is made in complying with the requirements of this section, the company, and every officer of the company who is in default, shall be punishable with fine which may extend to five hundred rupees for every day during which the default continues.