Allahabad High Court Refuses To Ban UP Cricket Association Or Order CBI Probe Into Assets Transfer

The Allahabad High Court has refused to ban or initiate CBI inquiry against the Uttar Pradesh Cricket Association (UPCA). It has also held that no mandamus can be issued to the Board of Control for Cricket in India (BCCI) to take over the assets of the UPCA as the UPCA was company incorporated under Section 25 of the Companies Act, 1956.Holding that there was no bar on transferring of assets from a society to a company registered under the Companies Act and that UPCA was a company and a separate legal entity, the bench of Justice Atul Sreedharan and Justice Siddharth Nandan held,“the prayer of the petitioner to issue directions to ban UPCA or for investigation by CBI, is absolutely baseless; and is essentially a private dispute, concerning succession of property of a dissolved society, for which appropriate forums were available but still the petitioner has chosen to file the present writ petition..”“The Uttar Pradesh Cricket Association” was registered as a society under the Act of 1860 in 1955. In 2005, a company limited by guarantee bearing the name “Uttar Pradesh Cricket Association” was incorporated under a licence issued under Section 25 of the Companies Act, 1956, its first stated object being to take over the assets and liabilities of the society, upon which the society would cease to exist.On 3rd September 2005, more than three-fifths of the members of the society resolved to dissolve it and to transfer its assets, liabilities and functions to the company. The Board of Directors of the company passed a corresponding resolution the same day, closed the bank accounts of the society and opened fresh accounts in its own name. The dissolution and the transfer were intimated to the Registrar, Firms, Societies and Chits, U.P.Twenty-one years later, The Cricket Association of Uttar Pradesh, a rival body, filed a writ petition seeking a mandamus for transfer of the assets, accounts and resources of the dissolved society in its favour, a direction to the Board of Control for Cricket in India to transfer to it the liabilities conferred on the dissolved society, a ban on the company from cricketing activity in the State, a CBI investigation, and high-level committees to inquire into the affiliation and financial aid extended by the BCCI.The petitioner argued that the society had never been validly dissolved, relying on Section 14 read with Section 14A of the Act of 1860 to contend that any property remaining after satisfaction of debts and liabilities was to go to the Government.The Registrar, Firms, Societies and Chits took the stand that no resolution or document relating to the dissolution had ever been submitted in the office of the Deputy Registrar, Kanpur, that the registration of the society expired on 10th October 2005 and was never renewed, and that the vesting of the assets in the company could not have been done.Reading Section 13 of the Societies Registration Act, 1860, the Court held that on a resolution passed by not less than three-fifths of the members the society stands dissolved forthwith, and that a reference to the principal civil court is required only where a dispute arises between the governing body or the members over the disposal and settlement of the property.It observed that there was admittedly no such dispute and no such reference, and that none of the resolutions had ever been challenged. Earlier proceedings before the Allahabad High Court and a public interest litigation before the Delhi High Court had culminated in favour of the company, with the challenge to its registration under Section 25 turned down.“that “UPCA” a registered company under Section 25 of the Act, 1956 while acquiring the assets, liabilities and functions of “UPCA” society on its dissolution w.e.f.03.09.2005 was within the framework of the Act, 1956 and there was no conflicting provisions, more specifically under Section 13 of the Act, 1860, to prevent the said acquisition of liability, assets and functions of the society; under Section 13 of the Act, 1860.”It declined to scrutinise the incorporation itself, noting that the Registrar of Companies, the competent authority, had acknowledged it as having been made according to law, and that the company had acquired a distinct legal personality from the date of its certificate of incorporation.Since the acquisition was within the legal framework, it held that no mandamus could issue to the State authorities or to the BCCI in respect of the assets, accounts and resources of either the erstwhile society or the company. It added that any grievance about the manner in which the affairs of the company are conducted lies before the National Company Law Tribunal under Sections 241 and 245 of the Companies Act, 2013.The Court further held,“the prayer of the petitioner to issue directions to ban UPCA or for investigation by CBI, is absolutely baseless; and is essentially a private dispute, concerning succession of property of a dissolved society, for which appropriate...

Allahabad High Court Refuses To Ban UP Cricket Association Or Order CBI Probe Into Assets Transfer

Upasna Agrawal

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Upasna Agrawal

Allahabad High Court Refuses To Ban UP Cricket Association Or Order CBI Probe Into Assets Transfer

Upasna Agrawal

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

Upasna Agrawal

This is a premium content
Available exclusively to
Our subscribers