DIR 11 Directly Filed By Director and Intimated To the Company About His Resignation Co Not Filled Dir 12 ?
CS Manish Buchasia (Practising Company Secretaries , Ahmedabad)
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"From the man who always has a Good heart ! "
R Somani
R Somani
(i) In Luke Auto Ancillary (India) Ltd. (in liquidation) v. Lakshmi Narain Raina (1999) 50 DRJ 1 (Delhi), the Court held that non-furnishing of e-Form 32 by the petitioner/accused director was of no consequence. In terms of Circular No. 42/(400)-CL-II-59, Dated December, 1959 issued by the Department of Company Affairs, where the Registrar had acknowledged the receipt of intimation from any director about his resignation that he had bona fide resigned as director, no prosecution could be instituted against him as the company secretary of the accused company was under obligation to file e- Form 32 with the Registrar.
(ii) In B.N.Kaushik v. Registrar of Companies (2009) 150 Comp Cas 97 (Delhi), the petitioner, was Hony. Secretary of the target company with effect from 27.7.1971. He sent his letter of resignation to the registered office of the company and a copy to the Registrar. The company failed to file the balance sheets etc. with the Registrar for the period covering 1982 to 1986. The Registrar convicted the petitioner as defaulter and awarded sentence. The petitioner challenged his conviction contending that
(i) complaints having been instituted after lapse of 22 years after the resignation was received by the Registrar were beyond the period of limitation and were devoid of disclosure norms;
(ii) the Registrar, while instituting winding up proceedings had acknowledged that the petitioner had tendered his resignation to the Registrar;
(iii) the alleged violations took place after his resignation; and
(iv ) in the light of Circular No.423(400)-CL-II-59, dated 29th. December, 1959 issued by the Department of Company Affairs sending of letter of resignation to the Registrar was a sufficient resignation.
It was held : “In view of the facts and relying upon the decision of this Court in Luke Auto Ancillary (supra) the petitions are allowed by setting aside the order of conviction and sentence dated 17th August, 2002 passed in CRL.A.No 3/2002 to 12/2002. CRL.REV.1004/2002 to 12/2002 stands disposed of accordingly.”
(iii) The Madras High Court in V.N.Thangavel v. Associated Business Credits Ltd. (2007) 137 Comp Cas 506 (CLB):(2009) 149 Comp Cas 543 (Mad) held that as the managing director failed to intimate acceptance or non-acceptance of the resignation tendered by the petitioner, the resignation dated 3.11.1999 became effective on 3.12.1999 i.e. after expiry of 30 days from the date of its submission by the director vide- Article 83 of the Articles of Association of the respondent company. The delay in invoking section 614 of the Companies Act, 1956 could not absolve the company of its obligation to file e-Form No. 32 with Registrar. Since the company after liquidation came under the control of Official Liquidator, he with the leave of Winding Court was under obligation to file Form No. 32 with Registrar, conveying the fact that the petitioner had submitted his resignation on 3.11.1999.
(iv) The Karnataka High Court in Mother Care (India) Ltd. v. Prof. Ramaswamy P.Aiyar (2004) 51 SCL 243 (Karnataka) held that failure of the company to file e-Form 32 with the Registrar could not by any means bind the director as he had submitted his resignation on 5th July, 1995 and the Board of the company accepted the resignation on 8th September, 1995. The company went into liquidation under Court’s order on 5th November 1999. As such, when the company went into liquidation, the petitioner was not a director. Consequently, the action taken by the Official Liquidator against the petitioner/ director for non compliance with Section 454 of the Companies Act, 1956 and any other provisions of the Act was without jurisdiction and the same was to be dropped.
(v) Manishkant Agrawal, the petitioner in Manish Kant Agarwal v. Nafed (2009) 1 JCC (NI) 41 (Delhi), had submitted his resignation, as a director to the accused company before the company issued dishonoured cheques, but was held liable as a co-accused for the offence under section 138 of the NI Act, 1881. He approached Delhi High Court, the petition was allowed. The High Court dismissed the contention of the respondent that the petitioner had not submitted e-Form 32 in support of his resignation. Relying on the similar case, namely, Glossop v. Glossop (1907) Ch.D. 370, the Court held that the petitioner had resigned prior to the issuance of dishonoured cheques as such he could not be held liable. It was the duty of the Company Secretary of the accused company to file e-Form 32 with the Registrar. The petitioner could not be held liable for alleged offence under section 138 read with section 142 of the N.I. Act, 1881.
(vi) Division Bench Judgment of the Bombay High Court in Saumil Dilip Mehta vs. State of Maharashtra reported in (2002) 39 SCL 102 (Bom.), wherein, in paragraph 6, it has been held as follows:-
“6. The submissions advanced by the litigating parties are touching an important point involved in this matter which make us to express our views on the point whether a director of a public or private limited company can resign unilaterally and that too by writing a letter to the chairman of the said company or its secretary. It is necessary for such a director to fill up Form No.32 and is obliged to give a notice or intimation to that effect to the Registrar of Companies ('ROC')? The question arises for our adjudication is whether that particular director is obliged to give such information to the ROC and whether he cannot retire without complying with the said requirement. Keeping in view the provisions of the Companies Act, 1956, the relevant articles of the Constitution of India, Bench came to the conclusion that a director of the public limited company or private limited company can tender his resignation unilaterally and without filling in Form 32 and without sending a notice to the Registrar of Companies. It is clear that the filling in of the said Form and the giving of due intimation and information to the Registrar of Companies is the duty of the company secretary and not of an individual director. Suffice it to say that what he has to do is to send in writing a letter informing either the chairman or the secretary of the company, as the case may be, his intention to resign from the post of the director of the said company. Thereafter the said letter has to be moved in the meeting of the directors of the company, it may be ordinary meeting or may be extraordinary or special meeting, as the case may be, and the board of directors have to take a decision whether the Board is accepting his resignation or not. An intimation should be sent to such director and after such resolution is passed, the company secretary is under the obligation to comply with the legal formalities for giving a finishing touch to the resolution which has been passed in the said meeting of the board of director. It is for the company secretary to fill in the forms as prescribed and to give due information and intimation to the ROC, as the law requires. Thereafter, it has to be so mentioned in all prescribed registers of the company, accounts and balance sheet of the company and thereafter the said fact is to be brought to the notice of the members of the company as early as possible and at the latest in annual general meeting.”