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CS Professional · Compliance Management, Audit and Due Diligence · Relief and Remedies

Meera Shah, company secretary of Ganga Foods Ltd, applies to the High Court under Section 463(2) for relief over an apprehended claim. The court is satisfied she acted honestly and reasonably. Before granting relief, what must the court do under Section 463(3)?

The court must first serve notice, in the manner it specifies, requiring the Registrar and any other person it considers necessary to show cause why relief should not be granted. Under Section 463(3), no relief can be granted without this step, even if the officer acted honestly.

  1. AObtain consent of all shareholders of the company
  2. BServe notice requiring the Registrar and any other person it thinks necessary to show cause why relief should not be grantedCorrect
  3. CRefer the application to the Tribunal for a recommendation
  4. DDirect the Central Government to appoint an Official Liquidator

Explanation

Section 463(3) bars any court from granting relief under sub-section (1) or (2) unless it has, by notice served in the manner it specifies, required the Registrar and such other persons as it thinks necessary to show cause. Honesty alone does not dispense with this step.

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