FORTUNE COMMERCIAL BANK LTD Vs. VIDYAGAURI J METHA

JUDGEMENT

(1.) THIS appeal arises out of Insolvency Appln. No. 45 of 1949 of the Dist. Ct. of East Khandesh in which the Dist. J. of East Khandesh has ordered under Section 162, Companies Act (VII [7] of 1913) the winding up of the Fortune Commercial Bank, Ltd. , Jalgaon, holding it proved on the evidence before him that the deceased managing director, of the applt. company, one Mr. K. G. Chaudhari, had grossly mismanaged the affairs of the company to secure benefit to himself and his friends, that loans without security to the extent of Rs. 90,000 had been advanced to the directors of the company, that suspicious entries to cover up the fraud had been made in the accounts of the company by the deceased managing director, that since 1-3-1949, the company was doing no business, that the substratum of the company had gone, that therefore the object of this banking company could not be carried out and that therefore it was just and equitable to wind up the company.

(2.) THE original opponent company feeling aggrieved by the above-stated order has come in appeal.

(3.) AT the very outset the applt's learned advocate has raised a point of law relating to the jurisdiction of the Dist. Ct. which has ordered the winding up. It was contended by him that the Dist. Ct. had no jurisdiction to proceed with the appln. for winding up after the passing of the Banking Companies (Amendment) Act, 1950 (XX [20] of 1950) and that the only Ct. which could deal with such an appln. after the passing of the above said Act was the H. C. For the purpose of this contention reliance is placed upon Sections 10 and 11, Banking Companies (Amendment) Act, 1950 (xx [20] of 1950 ). This is how Section 10 of the amending Act runs :