The Kerala high court on wednesday dismissed a batch of petitions challenging the disqualification of around 250 director of companies under section 164 and 167 of the companies Act and issued a set of directions and declaration regarding the concern raised in the petition.
This came after approximately 250 writ petition were filed before the court raising common question of law. All the petitoners were disqualified u/s 164(2) for failure of their respective companies to file financial statements / Annual Returns. The Petition therefore challanged section 164 and 167,and actions of the respondent pursuant therto. These petition were consequently hard together and disposed of by a common judgement.
The litigation we’re initiated contending that section 164 of the 2013 Act brought about a sweeping change in the disqualification for being appointed as directors of companies as compared to section 274 of the repealed 1956 Act.
It was alleged tha incident leading to disqualification u/s 164(2) are not directly attributes to Directors, and yet bore grave consequences on them.