Case Note & Summary
The dispute arose from a notification dated 21st June 1995, which amended paragraph 1.3 of Schedule X of the Companies Act, 1956. The petitioner, Pyrites Phosphates & Chemicals Ltd., challenged this notification as ultra vires the Constitution of India through a writ petition in the High Court of Calcutta. The single judge ruled in favor of the petitioner, declaring the amendment unreasonable and quashing the notification. The Registrar of Companies appealed this decision, but the Division Bench upheld the single judge's ruling, finding the notification violative of Article 14 of the Constitution. The matter reached the Supreme Court through a special leave petition. The Supreme Court noted that the Central Government had withdrawn the notification following the High Court's decision, restoring the previous regulatory framework. Consequently, the Supreme Court declined to interfere with the High Court's order and directed the appellant to refund the fees collected under the struck-down notification within three months, without interest. The appeal was allowed to the extent of refunding the fees, with no order as to costs. The Court clarified that this order should not be treated as a precedent for other similar matters.
Headnote
A) Constitutional Law - Ultra Vires - Amendment Notification - Companies Act, 1956, Section 1.3 - The amendment notification was challenged as being unreasonable and against legislative policy, leading to its quashing by the High Court. The Supreme Court upheld this decision and directed the refund of fees collected under the notification, emphasizing the need for legislative compliance (Paras 1-3).
Issue of Consideration
Whether the amendment notification under the Companies Act, 1956 was ultra vires the Constitution of India.
Final Decision
The Supreme Court upheld the High Court's decision to quash the notification dated 21st June 1995, directing the refund of fees collected under it within three months without interest.
Law Points
- Ultra vires
- Article 14
- refund of fees
- legislative policy
- notification challenge
