Decided on November 10,1964

Kedar Nath Khetan Appellant
Lakshmi Devi Sugar Mills (P) Ltd. Respondents


MATHUR, J. - (1.)THIS is an appeal by Raj Bahadur Kedar Nath Khetan, Gauri Prasad Khetan and Durga Prasad Khetan against the order of the Single Judge, dismissing their application under S. 398 of the Companies Act, 1956, on the ground that it was in view of the provisions of S. 399 of the Companies Act not maintainable. The learned Single Judge was of opinion that the appellants did not hold one-tenth of the issued share capital of the company find had also not paid sums due on their shares. In view of our decision in Special Appeals Nos. 108 to 111 of 1963, decided on 24-5-1963, (Since reported as Maheswari Khetan Sugar Mills (P) Ltd. v. Ishwari Khetan Sugar Mills, AIR 1965 All 135), it shall have to be held that the appellants did hold not less than one-tenth of the issued share capital of the company.
(2.)THE point for consideration, therefore, is if the appellants have not paid all the sums due on their shares; and if so, their application under S. 398 of the Companies Act shall not be maintainable till they have paid all such sums.
For the disposal of the appeal, it is not necessary to give the past history of the disputes between the parties to the appeal. The total issued share capital of the company, namely, the Lakshmi Devi Sugar Mills (Private) Limited, Chhitauni, respondent No. 1, is Rs. 12,61,500, and the value of the shares registered in the names of the appellants is to the tune of Rs. 2,29,500. Before the learned Single Judge the respondents had given the figure of Rs. 14,413.39 paise as the amount due from the appellants and hence on their shares. The respondents had produced the account books of the company, but did not lead any evidence to prove the items due from the appellants. In the interest of justice we considered it necessary to record additional evidence of the parties; and the respondents were, in the first instance, called upon to give a statement of the sums due to the company from the appellants and hence on their shares, and they did file a Statement of the sums due on 26-9-63. The appellants were thereafter to submit their objections to this Statement, and they did so by filing an objection in the form of an affidavit of Jai Narain Bajpai, Secretary to Rai Bahadur Kedar Nath Khetan. In this affidavit only four items were challenged and in addition it was pleaded that Smt. Jamuna Devi, wife of Rai Bahadur Kedar Nath Khetan, was a member of the joint Hindu family and a sum of Rs. 11,270.47 paise, payable to her, was to be adjusted towards the amounts due from the appellants. It was also pleaded that dividend to the tune of Rs. 33,000 was payable to the appellants which stood to their credit and was to be adjusted towards the amount due from them. The four disputed amounts are of Rs. 2.600, Rs. 737.16 paise, Rs. 182.45 paise, and Rs. 6,425, totalling Rs. 9,944.61 paise.

(3.)IN accordance with the Statement prepared and submitted in Court by the company, the amounts due from the appellants come to :-
Rs. 1. In the name of M/s. Maheshwari Agricultural Farm Barhya ...... 94.44 2. In the name of Khetan (Naraipur) Agricultural Farm Naraipur ...... 16,991.76 3. In the name of Khetan Agricultural Farm Khutai ...... 1,007.78 Total ...... 18,093.98

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