Kerala High Court Upholds Tata Tea’s Right To Decree Despite Company Name Change | Says Change Does Not Affect Legal Benefits Awarded
Safiya Malik
The High Court of Kerala Single Bench of Justice Easwaran S. has upheld the concurrent findings of two subordinate courts, dismissing a Regular Second Appeal against a decree for recovery of possession and damages obtained by a company whose name had changed during the course of litigation. The Court stated that "change of name shall not affect any rights or obligations of the company," thereby affirming the legality and enforceability of the decree passed in favor of the renamed entity.
The Court dismissed contentions that the decree had been passed in favor of a non-existent company, holding that a change in corporate name under the Companies Act does not affect legal proceedings by or against the entity. Additionally, the Court rejected the argument that the Munnar Special Tribunal Act, 2010, barred jurisdiction of civil courts in the matter, stating that the dispute in question did not fall within the statutory definition requiring adjudication by the tribunal. The appeal was thus dismissed, and the decree in favor of the respondent company was upheld.
The matter pertains to a suit for declaration of title, recovery of possession, and damages filed by a public limited company with its registered office at Calcutta and regional office at Munnar. The plaintiff and the defendant had entered into a license agreement on 24.01.1986. According to the terms of the agreement, the license was subject to annual renewal. However, it was alleged by the plaintiff that the defendant defaulted on the payment of license fees in May 2000. Following repeated demands, including a lawyer's notice dated 18.09.2000, the plaintiff filed a suit for recovery.
The defendant contested the suit, arguing that the plaintiff company no longer existed. It was contended that the assets of the plaintiff had been transferred to Tata Global Beverage Holdings Pvt. Ltd. Furthermore, the defendant claimed that the suit property was originally leased to her father by Kannan Devan Hills Produce Company, rendering the plaintiff's claim invalid. During the trial, the plaintiff submitted Exts.A1 to A6 and examined one witness. The defendant produced Exts.B1 and B2 but did not adduce oral evidence.
The Munsiff Court, Devikulam, adjudicated that there had indeed been a default in license fee payment and found that no renewal of the agreement had occurred. The court concluded that the plaintiff was entitled to recovery of possession and damages, thereby decreeing the suit in favor of the company.
Aggrieved, the defendant filed an appeal before the II Additional District Court, Thodupuzha, which upheld the trial court's decision. The appellate court rejected the claim that the civil suit was barred under Section 4 of the Munnar Special Tribunal Act, 2010, holding that the statute did not apply to the present dispute.
In the Regular Second Appeal before the High Court, the defendant reiterated that the decree had been passed in favor of a company that had changed its name during the pendency of litigation, thus rendering the decree unenforceable. It was also asserted that the civil courts had no jurisdiction due to the applicability of the Munnar Special Tribunal Act, 2010.
The Court recorded that the change of name was made under Section 23 of the Companies Act, 1956, which is analogous to Section 13 of the Companies Act, 2013. It noted that: "The change of name shall not affect any rights or obligations of the company, or render defective any legal proceedings by or against it."
The Court stated: "Therefore, this Court finds no merit in the contention of the learned counsel for the appellant that the decree obtained is in the name of a non-existent company."
"The decree passed in favour of the erstwhile company, whose name was the subsequently changed will enure to the benefit of the company inasmuch as there is no change in the constitution and that the name of the entity alone is changed."
In regard to the cited decision in Malhati Tea Syndicate Limited v. Revenue Officer, Jalpaiguri and Ors., the Court stated: "The decision rendered by the Calcutta High Court was on an entirely different context altogether... This Court fails to comprehend as to how the principles laid down... can be made applicable to the facts of the present case."
Regarding the reliance placed on Pr. Commissioner of Income Tax, New Delhi v. Maruti Suzuki India Limited, the Court noted: "The facts presented before this Court would show that there is no change in the constitution of the company. What is changed, is the name of the existing company..."
The Court observed that the dispute did not fall within the ambit of the Munnar Special Tribunal Act, 2010: "Going by the provisions of Section 2(d)... the dispute raised in the present case will not fall within the term of dispute as contemplated in the said Act."
The Court referred to a previous case, W.P.(C) No.3487/2011, where the State of Kerala clarified that: "The constitution of the Munnar Special Tribunal is only for the purpose of adjudicating the dispute regarding the ownership of the Government property in the Munnar area."
Additionally, the Court recorded: "At any rate... the Government of Kerala subsequently abolished the Munnar Special Tribunal."
The Court concluded its judgment by stating: "This Court cannot find any illegality or infirmity in the judgments rendered by the courts below."
The Court further stated: "Resultantly, finding that no substantial question of law arises for consideration in this appeal, the appeal fails and the same is dismissed."
It also stated: "Inasmuch as there is no change in the constitution of the entity and the entity as such remains, this Court is of the considered view that the appellant has not made out a case for interference."
Advocates Representing the Parties:
For the Appellant: Shri. Praveen K. Joy, Advocate
For the Respondent: Shri. V. Abraham Markos, Shri. Abraham Joseph Markos, Shri. Isaac Thomas, Shri. P.G. Chandapillai Abraham, Shri. Alexander Joseph Markos, Shri. Sharad Joseph Kodanthara, Smt. Zainab Zebaibrahim P.M., Shri. John Vithayathil, Advocates
Case Title: Antony v. Tata Tea Ltd.
Neutral Citation: 2025: KER:50200
Case Number: RSA No.1148 of 2014
Bench: Justice Easwaran S.
