Bombay High Court Order on CA2013: Rules not valid from 1st April, 2014 if not notified in Official Gazette

Bombay high court in scheme of amalgamation between Wadala Commodities Limited with Godrej Industries Limited has passed a judgment on postal ballot and e-voting. Court has observed that postal ballot and e-voting is an additional facility and cannot have the effect of dispensing the general meeting at all. Further, the court stated that gazetted copy of many MCA rules are not available… hence in the opinion of the court they are not binding so far or at least from 1st April 2014…

The Court noted that the website of the Ministry of Corporate Affairs has a link to a single scanned PDF file entitled COMPANIES ACT 2013 – STATEMENT OF NOTIFICATION OF RULES on its front page where about 21 rules are listed. They are all said to be effective 1st April 2014. Several of these are not yet gazette. The Court Hon™ble Judge expressed his concern as to how such rules can be made effective on a basis where a ministry simply puts up some scanned document under the signature of one of its officers but without any publication in the official gazette. The Court noted that publication is not an idle formality and has fact a well-established legal purpose. That purpose is not and cannot be achieved in such an ad-hoc manner. Therefore, the Court ruled that, till such time as these rules are gazetted, or there is some provision made for the dispensation of official gazette notification, none of the rules in the Ministry of Corporate Affairs PDF document that are not yet gazetted can be said to be in force.

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