w w w . L a w y e r S e r v i c e s . i n



Neeraj Kumarpal Shah v/s C2R Projects LLP & Others


Company & Directors' Information:- SHAH PROJECTS PRIVATE LIMITED [Active] CIN = U70101WB1998PTC087545

Company & Directors' Information:- R K SHAH PROJECTS PRIVATE LIMITED [Active] CIN = U45201GJ1998PTC034936

Company & Directors' Information:- K K SHAH PROJECTS PRIVATE LIMITED [Active] CIN = U45200GJ2013PTC074996

Company & Directors' Information:- NEERAJ PROJECTS PRIVATE LIMITED [Active] CIN = U45200PN2013PTC146926

Company & Directors' Information:- P. S. PROJECTS LLP [] CIN = AAD-4404

Company & Directors' Information:- M AND H PROJECTS LLP [Active] CIN = AAO-0451

Company & Directors' Information:- R B SHAH PROJECTS PRIVATE LIMITED [Strike Off] CIN = U45200GJ2011PTC064887

Company & Directors' Information:- M. R. SHAH PROJECTS PRIVATE LIMITED [Converted to LLP] CIN = U45200GJ2011PTC067107

Company & Directors' Information:- M S C K PROJECTS LLP [] CIN = AAG-0664

Company & Directors' Information:- J R R PROJECTS LLP [] CIN = AAG-9987

Company & Directors' Information:- D S SHAH & CO LLP [] CIN = AAH-0912

Company & Directors' Information:- R N SHAH & CO LLP [] CIN = AAJ-0757

Company & Directors' Information:- M. R. SHAH PROJECTS LLP [] CIN = AAL-7957

Company & Directors' Information:- SHAH J H & CO LLP [] CIN = AAJ-0518

    Letters Patent Appeal Nos. 1855, 1857 of 2017 in Special Civil Application No. 10393 of 2017 with Civil Application Nos. 13939 & 13962 of 2017

    Decided On, 07 December 2017

    At, High Court of Gujarat At Ahmedabad

    By, THE HONOURABLE CHIEF JUSTICE MR. R. SUBHASH REDDY & THE HONOURABLE MR. JUSTICE VIPUL M. PANCHOLI

    For the Appellant: S.N. Soparkar, Senior Advocate with Archana R Acharya, Parthiv B Shah, Jal Unwala with Ms Tejal A Vashi, Advocates. For the Respondents: Kamal B Trivedi, Senior Advocate with Parth Contractor, Kartik Yadav, Siddharth Dave, Advocates, Devang Vyas, Learned Assistant Solicitor General.



Judgment Text

Cav Common Judgment

Vipul M. Pancholi, J.

1. Both these appeals are filed under Clause 15 of Letters Patent against an oral judgment dated 03.10.2017 passed by the learned Single Judge in Special Civil Application No.10393 of 2017, by which, the learned Single Judge has allowed the petition filed by the present respondent Nos. 1 and 2 – original petitioners.

2. Letters Patent Appeal No.1855 of 2017 has been filed by the original respondent No.2, whereas Letters Patent Appeal No.1857 of 2017 has been filed by original respondent No.3. As the issue involved in both these appeals is similar and with the consent of learned advocates appearing for the parties, both the appeals are heard together and being disposed of finally by this common judgment.

3. The factual matrix of the case are as under:

3.1. The original petitioner No.1 came to be incorporated on 10.02.2015 as Limited Liability Partnership Firm (hereinafter referred to as the ‘LLP’ for the sake of convenience). At the time of incorporation three partners were having following capital contributions and profit sharing ratio:

(1) Neeraj Kumarpal Shah – original respondent No.2 - 2.25 lakh – 45%

(2) Kamal Sewaram Jadhwani – original respondent No.3 – Rs.1.25 lakh – 25%

(3) Dinesh Shiwana – Rs.1.50 lakh – 30%.

3.2. Thereafter, an Addendum to the aforesaid Agreement came to be executed on 27.02.2015 whereby the original Petitioner No.2 was introduced as a new partner with capital contribution of Rs.45 crores with 20% profit share in the LLP. However, after few weeks from the execution of the aforesaid Addendum dated 27.02.2015, the LLP discovered that the representations made by Mr. Neeraj Kumarpal Shah – original respondent No.2, were false whereby the petitioner No.2 was induced for making investment in the LLP. Thereafter it was further revealed that investment in one M/s. Kinetix Solutions Pvt. Ltd. never existed and that the same was made only after the infusion of Rs.45 crores by the petitioner No.2, into the LLP.

3.3. On 06.10.2016, upon receipt of bank account statement of the LLP followed by an inquiry into the affairs of the LLP and the original respondent No.2, it was revealed that fraud had been committed by the original respondent No.2 by siphoning and misappropriating the funds of the LLP for his personal benefits. Thereafter, immediately on 25.10.2016, the partners of the LLP in its meeting unanimously passed certain resolutions including expulsion of original respondent No.2. It was also resolved for appointment of one Mr. Ranjan Kumar Singh and Mr. Angad Singh Atwal as new partners in LLP. Immediately on the next day i.e. 26.10.2016, the LLP came to be reconstituted by five partners viz. (1) Manbhupinder Singh Atwal; (2) Kamal Sewaram Jadhwani; (3) Dinesh Shiwana; (4) Ranjan Kumar Singh and (5) Mr. Angad Singh Atwal with new updated capital contribution and profit sharing ratio.

3.4. It is further stated that on 28.10.2016, LLP reported the aforesaid developments to the original respondent No.1 – Registrar of Companies (hereinafter referred to as the ROC for brevity) by way of filling LLP Form No.3 in relation to the reconstituted LLP Agreement and LLP Form No.4 in relation to cessation and appointment of partners in the LLP.

3.5. The original respondent No.2 – appellant herein - the expelled partner, requested the ROC on 29.10.2016 that any kind of e-form submitted by LLP may not be approved. The original respondent No.2 thereafter filed CMA No. 111 of 2016 under the provisions of Section 9 of the Arbitration and Conciliation Act, 1996, before the Commercial Court, wherein he sought stay against implementation of decision of his expulsion as partner of LLP till the conclusion of arbitration proceedings. Immediately thereafter on 11.11.2016, the original respondent No.2 once again requested the ROC not to approve any form filed by the LLP and pointed out that dispute between the partners of LLP is subjudice before the Commercial Court. On the very same day i.e. on 11.11.2016, the ROC forwarded two complaints dated 29.10.2016 and 11.11.2016 filed by the original respondent No.2 to the LLP for giving its explanation within stipulated time limit. On the very same day, i.e. on 11.11.2016, ROC also informed the original respondent No.2 about his efforts to redress the grievance raised by the original respondent No.2 under the provisions of the Limited Liability Partnerships Act, 2008 (hereinafter referred to as ‘the Act of 2008’ for short).

3.6. On 20.11.2016, the LLP through its advocate submitted its reply to the ROC and requested to reject the complaints filed by the original respondent No.2. In the meantime, original respondent No.3 – Mr. Kamal Sewaram Jadhwani – appellant of Letters Patent Appeal No. 1857 of 2017, changed his stand and requested the ROC by his communication dated 23.11.2016 not to entertain any e-form submitted by the LLP. It is required to be noted that initially the original respondent No.3 filed caveat on 27.10.2016 before the City Civil Court, Ahmedabad against the apprehended action of the original respondent No.2 by alleging that the original respondent No.2 has misappropriated and fraudulently transferred funds of LLP by siphoning off the same to his personal bank account as well as those of his brother, sister and others.

3.7. Thereafter, the ROC forwarded copy of the reply submitted by the LLP to the original respondent No.2 by its communication dated 27.12.2016 and informed him that he has right to approach Court of law/NCLT to seek legal redressal in the matter so as to protect his interest, if he so desires.

3.8. It is further stated that CMA No.111 of 2016 filed by the original respondent No.2 came to be dismissed by the learned Commercial Court by an order dated 29.12.2016 and therefore the LLP informed the ROC about the aforesaid order by its communication dated 05.01.2017. It is stated that the order passed by the Commercial Court was challenged by the original respondent No.2 by filing First Appeal before this Court and the respondent No.2 informed the ROC about the same by his communication dated 12.01.2017.

3.9. Thereafter the LLP, on checking the website of the ROC, came to know about the comments uploaded by the ROC on its website as per Rule 36(6) of the Limited Liability Partnerships Rules, 2009 (hereinafter referred to as ‘the Rules of 2009’), seeking information in form of various queries and requesting the LLP to explain the same. Such comments were uploaded on 17.01.2017. The LLP, therefore, submitted the information to ROC with regard to the queries raised on its website on 19.01.2017. In addition to the said reply, the LLP also submitted LLP Form No.32, whereby the cessation letter of expelled partner and the consent letters of Mr. R. K. Singh and Mr. Angad Atwal were also uploaded. However, the ROC passed the impugned order dated 03.03.2017, inter alia, informing the LLP that LLP form No.3 was examined and marked as invalid and not taken on record mainly on the ground that Mr. Kamal Sewaram Jadhwani – original respondent No.3 has filed interim relief application being CMA No.4 of 2017 and therefore the said matter is subjudice and in this regard the LLP has not submitted satisfactory reply.

3.10. The petitioners therefore approached this Court by filing the captioned petition in which the petitioners have prayed for the following main relief/s:

'(a) That this Hon’ble Court may be pleased to allow the present petition;

(b) That this Hon’ble Court may be pleased to issue a writ, order or direction quashing and setting aside the communication dated 03.03.2017 received from the Ministry of Corporate Affairs;

(c) That this Hon’ble Court may be pleased to issue a writ, order or direction, mandating the Respondent to give effect to the e-Form 4 filed on 28.10.2016, by the LLP and take the same on record;

(d) That this Hon’ble Court may be pleased to issue a writ, order to direction, mandating the Respondent to give effect to the e-Form 3 filed on 28.10.2016, by the LLP and take the same on record;.....'

3.11. The learned Single Judge by impugned order dated 03.10.2017 allowed the petition and thereby quashed and set aside the communication dated 03.03.2017 with further direction to the ROC to give effect to e-form no.4 filed on 28.10.2016. The appellants – original respondent Nos. 2 and 3 have therefore filed the present appeals.

4. Heard Mr.S.N. Soparkar, learned Senior Advocate assisted by Ms Archana Acharya and Mr. Parthiv B. Shah, advocates for the appellant in Letters Patent Appeal No. 1855 of 2017; Mr. Jal S. Unwala, learned counsel assisted by Ms Tejal Vashi, learned advocate for the appellant in Letters Patent Appeal No. 1857 of 2017; Mr. Kamal B. Trivedi, learned Senior Advocate assisted by Mr. Parth Contractor, learned advocate for Respondent No.1; Mr. Kartik Yadav, learned counsel assisted by Mr. Parth Contractor, learned advocate for Respondent No.2 and Mr. Devang Vyas, learned Assistant Solicitor General with Mr. Siddharth Dave for Respondent No.3 in both the Letters Patent Appeals.

5. Learned Senior Advocate Mr. Soparkar assailed the order passed by the learned Single Judge mainly on the ground that the learned Single Judge has committed serious error in holding that the ROC in his ministerial capacity could not have postponed and declined to discharge his duty in the guise of verification and scrutiny of the documents and e-forms filed. It is submitted that the ROC is a statutory authority which could not have been expected to discharge its duty, much less ministerial nature, by ignoring the ongoing serious disputes between the parties. It is contended that the duty of the ROC is ministerial in nature when there is no dispute whatsoever exists and submission of e-form No.3 is unanimously by all the partners of LLP. However, when the serious disputes are going on in various forums amongst the partners, learned Single Judge ought not to have held that the function of the ROC is of ministerial in nature.

6. Learned Senior Advocate Mr. Soparkar thereafter would contend that ROC has power to look into the validity of the transactions and he is obliged to consider whether the requirements of Act of 2008 are complied with or not. If such requirements are not complied with, ROC is empowered to refuse registration of the forms. In support of the said contention, Mr. Soparkar has referred to the relevant provisions contained in the Act of 2008 and the Rules framed thereunder.

7. Learned Senior Advocate Mr. Soparkar further submits that on 24.10.2016, LLP issued a notice to the appellant – original respondent No.2 for removing him as partner of LLP by making baseless allegations. However, on the next date, i.e. 25.10.2016, a resolution to remove the original respondent No.2 came to be passed by the LLP and a new LLP agreement came to be executed on 26.10.2016, wherein, the original respondent No.2 – appellant was not included as partner in the LLP. It is contended that in the LLP Agreement dated 26.10.2016, which is produced at page 46 of the compilation, there is no reference to earlier Agreement and it is not an Addendum to the original LLP. Therefore, the concerned partners have formed/constituted new LLP. Therefore, the respondent ROC was not obliged to register e-form No.3 and form No.4 submitted by the original petitioners.

8. Learned Senior Advocate Mr. Soparkar thereafter contended that though CMA No.111 of 2016 filed by the original respondent No.2 under Section 9 of the Arbitration and Conciliation Act before the Commercial Court came to be dismissed and the said order is confirmed up to the Hon’ble Supreme Court, the observations made in the said proceedings are prima facie/tentative observations and thereby the interim relief in favour of the original respondent No.2 has been refused. However, the original petitioners cannot take advantage of the said observations which are prima facie in nature, when arbitration proceedings are still pending.

9. At this stage, learned Senior Advocate Mr. Soparkar has placed reliance upon the decision rendered by the Hon’ble Supreme Court in the case of Jamal Uddin Ahmed v. Abu Saleh Najmuddin, reported in (2003) 4 SCC 257 and in the case of State of Maharashtra v. Saeed Sohail Sheikh, reported in (2012) 13 SCC 192, wherein the Hon’ble Supreme Court has discussed what are the ministerial functions.

10. Learned advocate Mr. Jal Unwala, appearing for the appellant in Letters Patent Appeal No.1857 of 2017, has adopted the submissions canvassed by learned Senior Advocate Mr. Soparkar.

11. On the other hand, learned Senior Advocate Mr. Kamal Trivedi appearing for the original petitioners – present respondent Nos. 1 and 2 has referred to the original LLP Agreement, Addendum as well as the Resolution passed on 25.10.2016 and submitted that the petitioners uploaded the form Nos.3 and 4 on 28.10.2016. However, when the complaint/representation was filed by the original respondent No.2 before the office of ROC, ROC asked for the explanation from the petitioners and the petitioners have given their reply on 20.11.2016. Learned Senior Advocate Mr. Trivedi thereafter referred to the comments uploaded by the ROC on its website on 17.01.2017 and thereafter referred to the communication dated 19.01.2017 addressed by the petitioners to the ROC. Mr. Trivedi, learned Senior Advocate submitted that form No.32 was also submitted by the petitioners and though the petitioners complied with all the queries raised by the ROC in its website uploaded on 17.01.2017, the ROC passed an order on 03.03.2017 and informed the petitioners that LLP Form No.3 was examined and marked as invalid and not taken on record on the ground that Mr. Kamal Sewaram Jadhwani – original respondent No.3 has filed CMA No.4 of 2017 and therefore the said matter is subjudice and in this regard the LLP has not submitted satisfactory reply. It is contended that merely because one of the partners, who has initially supported the petitioners and filed caveat on behalf of the LLP against the original respondent No.2, has changed his stand and now he is supporting original respondent No.2, the ROC was not right in not entertaining the LLP form submitted by the petitioners.

12. Learned Senior Advocate Mr. Kamal Trivedi thereafter referred to the provisions contained in Rules 36, 21 and 22 of the Rules of 2009 as well as Sections 23 and 25 of the Act of 2008.

13. Learned Senior Advocate Mr. Kamal Trivedi would thereafter contend that the appellant herein – original respondent No.2 has, for the first time, raised the contention that on 26.10.2016 new LLP has been constituted and therefore ROC is justified in not entertaining form Nos. 3 and 4 submitted by the original petitioners. It is submitted that in the complaints filed by the appellant – original respondent No.2 before the ROC, before the learned Single Judge or even in the memo of Letters Patent Appeal such ground is not taken and for the first time during the course of submission such contention is raised which may not be entertained by this Court. At this stage, it is pointed out that the ROC has also not passed the impugned order dated 03.03.2017 on the said ground and therefore a new ground cannot be taken by the appellant at the time of hearing of these appeals.

14. Learned Senior Advocate Mr. Kamal Trivedi thereafter submitted that the function which is required to be performed by the ROC is of ministerial in nature and he ought not to have postponed and declined to discharge his duty. In support of the said contention, learned Senior Advocate Mr. Trivedi has placed reliance upon the decisions rendered by Delhi High Court in the case of (1) Golconda Industries Private Ltd. v. Registrar of Companies, reported in AIR 1968 Delhi 170 and (2) S.K.Bhattacharya v. Union of India, reported in 1998 (91) Company Cases 37 (Delhi) as well as the decision rendered by Madras High Court in the case of Theni Melapettai Hindu Nadarkal Uravinmurai v. the District Registrar, Societies, Periyakulam, Theni District, reported in 2007(5) CTC 421.

15. Learned advocate Mr. Siddarth Dave appearing for learned Assistant Solicitor General Mr. Devang Vyas for ROC fairly submitted that ROC is in process of implementing the order passed by the learned Single Judge and ROC has not filed appeal against the order passed by the learned Single Judge.

16. In rejoinder, learned Senior Advocate Mr. Soparkar alternatively submitted that the writ issued by the learned Single Judge may be modified as the learned Single Judge is not right in giving direction to the ROC to give effect to e-form No.4 filed on 28.10.2016. Thus, ROC may be directed to examine the details submitted by the original petitioners in form No.3 and form No.4 and consider the same in light of the provisions of the Act of 2008 and the Rules framed thereunder.

17. Having heard learned counsel appearing for the parties and having gone through the material produced on record, following issue is raised for our consideration:

'Whether the function of the ROC is of ministerial in nature? If the duty of the ROC is of ministerial in nature, whether he could have proceeded to adjudicate and resolve the dispute between the partners of LLP?'

18. From the record, it is revealed that on 10.02.2015, LLP came to be incorporated in which Mr. Neeraj Kumarpal Shah (original respondent No.2) Mr. Kamal Sewaram Jadhwani (original respondent No.3) and Mr. Dinesh Shiwana were the partners. Thereafter an Addendum to the said Agreement executed on 27.02.2015, whereby the original Petitioner No.2 was introduced as a new partner with capital contribution of Rs.45 crores. From the averments and the submissions it is further revealed that on or around 06.10.2016, it was noticed by the original petitioner no.2 from the Bank Account Statement of LLP and after inquiry that fraud had been committed by the original respondent No.2 by siphoning and misappropriating the fund of LLP for his personal benefit. Therefore, on 25.10.2016, partners of LLP in its meeting unanimously passed certain resolutions including expulsion of the original respondent No.2. On the very same day, it was also resolved to appoint Mr. Ranjan Kumar Singh and Mr. Angad Singh Atwal as new partners in LLP. On 26.10.2016, LLP came to be reconstituted by five partners and thereafter on 28.10.2016, form No.3 and form No.4 were submitted to the ROC. It further transpires that the original respondent No.2 requested the ROC not to approve e-form submitted by LLP by his communication dated 29.10.2016 and thereafter on 11.11.2016. The original respondent No.2 also preferred CMA No. 111 of 2016 before the Commercial Court under Section 9 of the Arbitration and Conciliation Act, 1996. However, the Commercial Court did not entertain the said application and rejected the same by reasoned order. The First Appeal preferred by the original respondent No.2 before this Court is also dismissed by the Division Bench of this Court. Against which, Special Leave Petition was preferred before the Hon’ble Supreme Court which is also dismissed.

19. It is further revealed that on 17.01.2017, the ROC uploaded comments on its website as per Rule 36(6) of the Rules of 2009 seeking information in the form of various queries and requested the LLP to explain the same. The LLP, therefore, submitted necessary information immediately on 19.01.2017. The LLP also submitted form No.32 whereby the cessation letter of expelled partner and consent letters of two new partners were also uploaded. However, though all the necessary details were supplied by the petitioners, ROC, by its communication dated 03.03.2017, informed the petitioners that form No.3 filed by them has been examined and marked as invalid and not taken on record with the remarks that Mr. Kamal Sewaram Jadhwani has filed interim relief application in the Commercial Court at Ahmedabad vide Commercial Civil Misc. Application No.4 of 2017. Therefore, the said matter is subjudice and in this regard LLP has not submitted satisfactory reply.

20. At this stage, we would like to refer to the relevant provisions of the Act of 2008 and Rules of 2009. Sub-section (2) of Section 23 of the Act of 2008 reads as under:

'23. Relationship of partners.-(1) xxxxxx

(2) The limited liability partnership agreement and any changes, if any, made therein shall be filed with the Registrar in such form, manner and accompanied by such fees as may be prescribed.'

20.1. Sub-sections (2), (3) and (4) of Section 25 of the Act of 2008 read thus:

'25. Registration of changes in partners.-

(1) xxxxx

(2) A limited liability partnership shall-

(a) Whether a person becomes or ceases to be a partner, file a notice with the Registrar within thirty days from the date he becomes or ceases to be a partner; and

(b) Whether there is any change in the name or address of a partner, file a notice with the Registrar within thirty days of such change.

(3) A notice filed with the Registrar under sub-section (2) –

(a) shall be in such form and accompanied by such fees as may be prescribed;

(b) shall be signed by the designated partner of the limited liability partnership and authenticated in a manner as may be prescribed; and

(c) if it relates to an incoming partner, shall contain a statement by such partner that he consents to becoming a partner, signed by him and authenticated in the manner as may be prescribed.

(4) If the limited liability partnership contravenes the provisions of subsection( 2), the limited liability partnership and every designated partner of the limited liability partnership shall be punishable with fine which shall not be less than two thousand rupees but which may extend to twenty-five thousand rupees.'

20.2. Section 43 of the Act of 2008 provides that:

'43 Investigation of the affairs of limited liability partnership .-

(1) The Central Government shall appoint one or more competent persons as inspectors to investigate the affairs of a limited liability partnership and to report thereon in such manner as it may direct if-

(a) the Tribunal, either suo motu, or on an application received from not less than one-fifth of the total number of partners of limited liability partnership, by order, declares that the affairs of the limited liability partnership ought to be investigated; or

(b) any Court, by order, declares that the affairs of a limited liability partnership ought to be investigated.

(2) The Central Government may appoint one or more competent persons as inspectors to investigate the affairs of a limited liability partnership and to report on them in such manner as it may direct.

(3) The appointment of inspectors pursuant to sub-section (2) may be made,-

(a) if not less than one-fifth of the total number of partners of the limited liability partnership make an application along with supporting evidence and security amount as may be prescribed; or

(b) if the limited liability partnership makes an application that the affairs of the limited liability partnership ought to be investigated; or

(c) if, in the opinion of the Central Government, there are circumstances suggesting-

(i) that the business of the limited liability partnership is being or has been conducted with an intent to defraud its creditors, partners or any other person, or otherwise for a fraudulent or unlawful purpose, or in a manner oppressive or unfairly prejudicial to some or any of its partners, or that the limited liability partnership was formed for any fraudulent or unlawful purpose; or

(ii) that the affairs of the limited liability partnership are not being conducted in accordance with the provisions of this Act; or

(iii) that, on receipt of a report of the Registrar or any other investigating or regulatory agency, there are sufficient reasons that the affairs of the limited liability partnership ought to be investigated.'

20.3. Rules 21 and 22 of the Rules of 2009 provide as under:

'21.(1) For the purposes of sub-section (2) of section 23, every limited liability partnership shall file information with regard to the limited liability partnership agreement in Form 3 with the Registrar within thirty days of the date of incorporation alongwith the fee as provided in Annexure ‘A’: Provided that any change made in the limited liability partnership agreement shall be filed in Form 3 within thirty days of such change alongwith the fee as provided in Annexure ‘A’.

(2) For the purposes of sub-section (3) of section 23, every limited liability partnership shall file information with regard to the limited liability partnership agreement referred to in such sub-section, in Form 3 with the Registrar within thirty days of the ratification by all the partners alongwith the fee as provided in Annexure ‘A’.'

'22.(1) For the purposes of sub-section (1) of section 25, every partner shall intimate change in his name or address to the limited liability partnership in Form 6.

(2) For the purposes of sub-section (2) of section 25, where a person becomes or ceases to be a partner or where there is any change in the name or address of a partner, the limited liability partnership shall file with the Registrar, a notice in Form 4.

(3) For the purposes of sub-section (3) of section 25, in respect of notice of a person becoming a partner, the Form 4 shall include a statement signed by the incoming partner that he consents to become a partner.

(4) The form shall be accompanied by a certificate from a Chartered Accountant in practice or Cost Accountant in practice or a Company Secretary in practice that he has verified the particulars from the books and records of the limited liability partnership and found them to be true and correct.

(5) The fees to be paid to the registrar in pursuance of sub-section (3) of section 25 shall be as mentioned in Annexure ‘A’.'

20.4. Sub-rules (5) to (10) of Rule 36 provide as under:

'(5) The Registrar shall examine or cause to be examined every application or e-Form or document required or authorized to be filed by or delivered under the Act and rules made thereunder for approval, registration, taking on record or rectification by the Registrar as the case may be:

Provided that the e-Forms or documents identified as informatory in nature and filed under Straight Through Process (STP) may be examined by the Registrar any time after its filing.

(6) Where the Registrar, on examining any application or e-Form or document referred to in sub-rule (5), finds it necessary to call further information or finds such application or e-Form or document to be defective or incomplete in any respect, he shall give intimation of such information called for or defects or incompleteness noticed electronically, by placing it on the website and also by e-mail on the last intimated e-mail address of the person or the limited liability partnership, which has filed such application or e-Form or document, directing him or it to furnish such information or to rectify such defects or incompleteness or to re-submit such application or e-Form or document within the period allowed under sub-rule (7):

Provided that in case the e-mail address of the person or the Limited Liability Partnership in question is not available, such intimation shall be given by the Registrar by post at the last intimated address given in Form 12, or registered office address of the Limited Liability Partnership or the address of such person, as the case may be,. The Registrar shall preserve the facts of such intimation in the electronic record.

(7) The Registrar shall allow such period or periods but not exceeding thirty days in aggregate to such person or LLP which has filed such application or e-Form or document under sub-rule (5) for furnishing further information or for rectification of the defects or incompleteness or for re-submission of such application or e- Form or document.

(8) In case where such further information called for has not been provided or has been furnished partially or has not been provided or defects or incompleteness has not been rectified or has been rectified partially or has not been rectified to the satisfaction of the Registrar within the period allowed under sub-rule (7), the Registrar shall either reject or treat and label such application or e-Form or document as the case may be as 'invalid' in the electronic record, and shall not take on record such invalid application or e-Form or document and shall inform such person or limited liability partnership as the case may be in the manner specified in sub-rule (6).

(9) Where any document has been recorded as invalid by the Registrar, such document may be rectified by the limited liability partnership only through fresh filing with payment of fee and additional fee as applicable, without prejudice to any other liability under the Act.

(10) Save as otherwise provided in the Act, the Registrar shall not keep any document pending for approval and registration or for taking on record or for rejection or otherwise for more than one hundred twenty days, from the date of its filing.'

21. From the aforesaid provisions contained in the Act of 2008 and the Rules framed thereunder, it can be said that every LLP shall have at least two designated partners and an individual shall not become a designated partner in any LLP unless he has given his prior consent to act as such to the LLP in such form and manner as may be prescribed. Every LLP shall file with the Registrar particulars of every individual who has given his consent to act as designated partner in the prescribed form within stipulated time limit. If there is any change in the LLP agreement, the same shall be filed with the Registrar in the prescribed form. It is further provided under the Act of 2008 that where a person becomes or ceases to be a partner in LLP, the LLP shall file a notice with the Registrar within stipulated time limit from such event. Such notice shall be in the prescribed form with necessary details. As per Rule 21 of the Rules of 2009, every LLP shall file information with regard to the LLP agreement in form No.3 with the Registrar within stipulated time limit. Similarly, where a person becomes or ceases to be a partner, the LLP shall file with the Registrar a notice in form No.4 as provided under Rule 22 of the Rules of 2009.

22. If the facts discussed hereinabove are examined, it is revealed that after the original respondent No.2 was expelled from the LLP by passing resolution dated 25.10.2016, on the very same day it was also resolved to add two new partners in the LLP and therefore on 26.10.2016, LLP was reconstituted and accordingly on 28.10.2016 the petitioners submitted necessary details as per the aforesaid provisions of the Act of 2008 and the Rules framed thereunder to the ROC. As per the provisions of the aforesaid Act and the Rules, ROC is required to examine as to whether the provisions of the Act and the Rules are complied with or not and he cannot enter into the merits of the dispute between the partners. Once the necessary details are submitted to the ROC he has to take on record such details. From the comments uploaded on the website of the ROC on 17.01.2017, it is revealed that ROC has sought for following information’s/clarifications:

'(i) Cessation letter of Mr. Neeraj Kumarpal Shah is not attached;

(ii) Consent letter of Mr. Ranjan Kumar Singh and Mr. Angad Singh Atwal for appointment is not attached in LLP Form No. 4;

(iii) LLP Agreement submitted with LLP form No.3 is not notarized. Offer comments regarding authenticity and enforceability of the Agreement;

(iv) There is a provision of arbitration in case of disputes between the partners. Explain the steps taken by LLP in this regard; and

(v) Mr.Kamal Sewaram Jadhwani has filed interim relief application in the Commercial Court at Ahmedabad vide Commercial Civil Misc. Application No.4 of 2017, which is subjudice. In this regard, offer your comments.'

23. The petitioners thereafter immediately by communication dated 19.01.2017 provided necessary explanation and supplied the required consent letters and notarized agreement and also submitted Form No.32. The said details are produced at page 264 to 269 of the compilation.

24. However, from the order dated 03.03.2017 passed by the ROC, it is revealed that the ROC has not taken on record Form No.3 submitted by the petitioners and treated it as invalid only on the ground of pendency of application filed by Mr. Kamal Sewaram Jadhwani – original respondent No.3 before the Commercial Court. Thus, the ROC has not treated the form submitted by the petitioners as invalid on the ground that necessary details which are required to be submitted under the Act of 2008 and the Rules of 2009 are not furnished to him but he has not accepted the form and treated it as invalid only on the ground of pendency of litigation before the Commercial Court.

25. At this stage, we would like to refer to the decision rendered by the Hon’ble Supreme Court in the case of Jamal Uddin Ahmed (supra), wherein the Hon’ble Supreme Court has observed in para 14 as under:

'14. The judicial function entrusted to a Judge is inalienable and differs from an administrative or ministerial function which can be delegated or performance whereof may be secured through authorization.

"The judicial function consists in the interpretation of the law and its application by rule or discretion to the facts of particular cases. This involves the ascertainment of facts in dispute according to the law of evidence. The organs which the state sets up to exercise the judicial function are called courts of law or courts of justice. Administration consists of the operations, whatever their intrinsic nature may be, which are performed by administrators; and administrators are all state officials who are neither legislators nor judges"

(See Constitutional and Administrative Law, Philips and Jackson, Sixth Edition, p. 13). P. Ramnath Aiyer's Law Lexicon defines Judicial Function as the doing of something in the nature or in the course of an action in court, (p. 1015). The distinction between "Judicial" and "Ministerial Acts" is:

"if a judge dealing with a particular matter has to exercise his discretion in arriving at a decision, he is acting judicially; if on the other hand, he is merely required to do a particular act and is precluded from entering into the merits of the matter, he is said to be acting ministerially." (p. 1013-14).

Judicial function is exercised under legal authority to decide on the disputes, after hearing the parties, may be after making an enquiry, and the decision affects the rights and obligations of the parties. There is duty to act judicially. The judge may construe the law and apply it to a particular state of facts presented for the determination of controversy. A ministerial act, on the other hand, may be defined to be one which a person performs in a given state of facts, in a prescribed manner, in obedience to the mandate of a legal authority, without regard to, or the exercise of, his own judgment upon the propriety of the act done (Law Lexicon, Ibid., p. 1234). In ministerial duty nothing is left to discretion; it is a simple, definite duty. Presentation of election petition to the High Court within the meaning of Section 81 of the Act without anything more would mean delivery of election petition to the High Court through one of its officers competent or authorized to receive the same on behalf of and for the High Court. Receiving an election petition presented under Section 81 of the Act is certainly not a judicial function which needs to be performed by a judge alone. There is no discretion in receiving an election petition. An election petition, when presented , has to be received. It is a simple, definite duty. The date and time of presentation and the name of person who presented (with such other particulars as may be prescribed) are to be endorsed truly and mechanically on the document presented. It is a ministerial function simplicitor. It can safely be left to be performed by one of the administrative or ministerial staff of the High Court which is as much a part of the High Court. It may be delegated or be performed through someone authorized. The manner of authorization is not prescribed.'

26. In the case of Saeed Sohail Sheikh (supra), the Hon’ble Supreme Court has observed in para 26 to 28 as under:

'26. The expressions 'ministerial', 'ministerial office', 'ministerial act', and 'ministerial duty' have been defined by Black's Law Dictionary as under:

"Ministerial, Adj. (16c) of or relating to an act that involves obedience to instructions or laws instead of discretion, judgment, or skill the court clerk's ministerial duties include recording judgments on the docket.

Ministerial office. An office that does not include authority to exercise judgment, only to carry out orders given by a superior office, or to perform duties or acts required by rules, statutes, or regulations.

Ministerial act. An act performed without the independent exercise of discretion or judgment. If the act is mandatory, it is also termed a ministerial duty.

Ministerial duty. A duty that requires neither the exercise of official discretion nor judgment.

27. "Prof. de Smith in his book on 'Judicial Review' (Thomson Sweet & Maxwell, 6th Edn., 2007) refers to the meaning given by Courts to the terms 'judicial', 'quasi-judicial', 'administrative', 'legislative' and 'ministerial' for administrative law purposes and found them to be inconsistent. According to the author 'ministerial' as a technical legal term has no single fixed meaning. It may describe any duty the discharge whereof requires no element of discretion or independent judgment. It may often be used more narrowly to describe the issue of a formal instruction, in consequence of a prior determination which may or may not be of a judicial character. Execution of any such instructions by an inferior officer sometimes called ministerial officer may also be treated as a ministerial function. It is sometimes loosely used to describe an act that is neither judicial nor legislative. In that sense the term is used interchangeably with 'executive' or 'administrative'. The tests which, according to Prof. de Smith delineate 'judicial functions', could be varied some of which may lead to the conclusion that certain functions discharged by the Courts are not judicial such as award of costs, award of sentence to prisoners, removal of trustees and arbitrators, grant of divorce to petitioners who are themselves guilty of adultery etc. We need not delve deep into all these aspects in the present case. We say so because pronouncements of this Court have over the past decades made a distinction between quasi-judicial function on the one hand and administrative or ministerial duties on the other which distinctions give a clear enough indication and insight into what constitutes ministerial function in contra-distinction to what would amount to judicial or quasi-judicial function.

28. In Province of Bombay v. Khusaldas Advani (AIR 1950 SC 222) this Court had an occasion to examine the difference between a quasi-judicial order and an administrative or ministerial order. Chief Justice Kania, in his opinion, quoted with approval an old Irish case on the issue in the following passage: (AIR p.224, para 5)

"5....the point for determination is whether the order in question is a quasi-judicial order or an administrative or ministerial order. In Regina (John M' Evoy) v. Dublin Corporation [1978] 2 L.R. Irish 371, 376, May C.J. in dealing with this point observed as follows:

"It is established that the writ of certiorari does not lie to remove an order merely ministerial, such as a warrant, but it lies to remove and adjudicate upon the validity of acts judicial. In this connection, the term 'judicial' does not necessarily mean acts of a judge or legal tribunal sitting for the determination of matters of law, but for the purpose of this question a judicial act seems to be an act done by competent authority, upon consideration of facts and circumstances, and imposing liability or affecting the rights of others."

This definition was approved by Lord Atkinson in Frome United Breweries Co. v. Bath JJ A.C. p.602, as the best definition of a judicial act as distinguished from an administrative act.'

27. In the case of Golconda Industries Private Ltd. (supra), the Full Bench of Delhi High Court observed that the Registrar cannot sit in judgment over the validity or invalidity of the transaction. It is further observed that there is a statutory obligation on the part of the Registrar to register the return if it is not defective or incomplete.

28. In the case of S.K.Bhattacharya (supra), the Delhi High Court has observed as under:

'There cannot be any objection and this position has also not been disputed that the Registrar of Companies is merely an administrative authority appointed under section 609 of the Act. The office of the Registrar of Companies is merely an office of record. The Registrar is neither a court, nor an adjudicating authority. In case circulars had been issued by the Ministry of Law, Justice and Company Affairs laying down guidelines of registration or non-registration of Form No.32, it was but necessary for the Registrar to have followed the said instructions/guidelines contained in the circular. It is not correct to say that the Registrar is not bound by the guidelines or that the same are not mandatory.

As of today the position is that there has already been acceptance and registration of Form No.32, which was submitted on April 23, 1992, by the R.K.Chhabria group and the forms submitted by and on behalf of the other group on June 10, 1992, were not accepted. In view of the decision, which has already been taken in C.P.No. 29 of 1992, and by decision of the Company Law Board in C.P. No. 30 of 1993, though the same is under challenge, the question is of an academic nature. We are not concerned at this stage about the implication of the decision in C.P. No. 29 of 1992, and C.P. No.30 of 1993, in view of the narrow controversy. In case there has been any omission on the part of the Registrar, whether deliberate or otherwise, in not adhering strictly to the guidelines as contained in the circular dated October 24, 1961, the Registrar being merely an administrative authority, his action in merely taking on record and registering Form No.32 submitted by the K.R. Chhabria group will not and cannot prejudice the right of petitioner No.1 or those directions, whose registration is stated to have been accepted or that of B. B. Nandi in any of the proceedings.

xxx xxx xxx

The Company Law Board is the authority competent to take decisions on the affairs of the company. NO doubt the order passed in C.P.No.30 of 1993, is the subject-matter of appeal, but for the purpose of the present petition, suffice it to observe that the mere acceptance and registration of form No.32 by the Registrar could not have prejudiced the case of the petitioners in any proceedings before the competent authorities, since, as observed above, acceptance of the form by the Registrar is only a ministerial act. The Registrar is

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only an administrative authority appointed under section 609 of the Act. He is neither a court, nor an adjudicating authority.' 29. In the case of Theni Melapettai Hindu Nadarkal Uravinmurai (supra), the Madras High Court has observed in para 19 and 20 as under: '19. It is seen from the language in which Section 15 of the Act and Rule 17 of the Rules is couched that there is a statutory obligation cast upon the society to file Form No.VII within the time limit prescribed thereto. The Act or Rules do not envisage any statutory duty or responsibility on the part of Registrar of Societies while accepting Form V or Form VII filed under the Act. Therefore, it appears that what the Registrar does while accepting the Forms, is only a ministerial act of receiving the form, scrutinizing the same to the extent necessary to verify the correctness of the particulars contained therein and registering the same. In other words, the Registrar does no more job than that of the Registrar of Companies accepting Form No.32 or Form No.34 under the Companies Act, 1956. 20. It is in view of such a position emerging out of the statutory provisions that the Full Bench of this Court laid in no uncertain terms in paragraph 20 that what is required of the Registrar is only to satisfy himself about the correctness of the particulars furnished in Form No.VII. The duty of the Registrar to satisfy himself about the particulars furnished in Form No.VII, is not large than that of a ministerial act. The Registrar is not a competent to see if an election is validly conducted, if the office bears were properly elected or if there were any illegalities in the manner in which the office bearers were elected. The verification of the particulars contained in Form No. VII to be done by the Registrar cannot be enlarged so as to enable him to test the validity of election itself.' 30. Keeping in view the aforesaid decisions rendered by the Hon’ble Supreme Court as well as Delhi High Court and Madras High Court and the provisions of the Act of 2008 and the Rules of 2009, if the facts of the present case as discussed hereinabove are examined, it can be said that when the prescribed forms are submitted before the ROC for examination and registration, the ROC is required to consider as to whether the provisions of the Act of 2008 and the Rules of 2009 are complied with or not. Thus, the duty of the ROC is of ministerial in nature and he is acting as an administrative authority. The ROC cannot adjudicate and go into the merits of the dispute pending between the partners. The ROC has to register the necessary forms subject to outcome of the proceedings pending before the competent Court between the concerned partners. At this stage, once again it is required to be noted that in the communication dated 03.03.2017, the ROC has only stated that one interim relief application filed by one of the partners of LLP is pending before the Commercial Court for which no satisfactory reply is given by the petitioners and therefore the forms submitted by the petitioners are marked as invalid and not taken on record. It is required to be noted that the ROC has not stated that the required details as per the Act of 2008 and Rules of 2009 are not furnished by the petitioners and therefore such forms cannot be accepted and the same are treated to be invalid. Thus, such communication is required to be quashed and set aside and therefore the learned Single Judge has rightly quashed and set aside the said communication. 31. Learned Senior Advocate Mr. Soparkar appearing for the appellant – original respondent No.2 has submitted that on 26.10.2016 new LLP has been formed and it is not an Addendum to the original LLP and therefore ROC has not committed any illegality by not accepting the forms submitted by the petitioners. However, from the record, it is clear that the original respondent No.2 has not raised such contention before the ROC nor the ROC has treated the forms submitted by the petitioners as invalid on the said ground nor the said contention was raised before the learned Single Judge and even while preparing the memo of appeal and for the first time during the course of argument, such contention is raised. Thus, new plea cannot be taken at the stage of Letters Patent Appeal. When the ROC has not treated the forms submitted by the petitioners as invalid on the aforesaid ground it is not necessary for us to consider the said submission in the present appeal. 32. For the foregoing reasons and in view of the reasoning recorded by the learned Single Judge, we are of the view that no error is committed by the learned Single Judge which requires interference of this Court in the present appeals. Accordingly, the Letters Patent Appeals are dismissed. In view of dismissal of the Letters Patent Appeals, civil applications do not survive for adjudication and stand disposed of.
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