MATHUR, J. - (1.) THIS judgment shall govern special appeals Nos. 108 to 111 of 1963 which arises out of four applications under S. 155 of the Companies Act, 1956, for rectification of registers of members. Special Appeal No. 108 of 1963 is against the order of the Company Judge passed in company case No. 16 of 1962 initiated on the application of Manna Lal Khetan against Lakshmi Devi Sugar Mill; (Private) Ltd. Chhitauni, distt. Deoria, Kedar Nath Khetan and his adopted son, Gauri Prasad Khetan, and R.N. Chavan, special Mamlatdar and Receiver appointed by the Collector, Bombay, in recovery proceedings against Kedar Nath Khetan Mitanand and Mata Din Hari Ram. Special Appeal No. 109 is against the decision in company case No. 17 of 1962 started on the application of Manna Lal Khetan, Matadin Khetan, Bhagwati Prasad Khetan, sons of Seth Hari Ram Khelan, and Smt. Mahadbiri Devi widow of Seth Hari Ram Khetan against Lakshmi Devi Sugar Mills (Private) Ltd. Chhitauiti, distt. Deoria, Durga Prasad Khetan, Gauri Prasad Khetan and Sri R.N. Chavan, special Mamlatdar. Special Appeal No. 110 of 1963 arises out of company case No. 18 of 1962, Kamla Prasad Khetan and Jwala Prasad Khetan, sons of Seth Onkarmal Khetan v. Lakhmi Devi Sugar Mills (Private) Ltd. Kedar Nath Khetan, Durga Prasad Khetan, Gauri Prasad Khetan, Smt. Saraswati Devi and Sri R.N. Chavan. Special Appeal No. 111 relates to another Sugar Factory Maheshwari Khetan Sugar Mill (Private) Limited, Ramkula, district Deoria and arises out of company case No. 15 of 1982 started on the application under S. 155 of the Companies Act of the Ishwari Khetan Sugar Mills (Private) Ltd. Lakshmiganj, District Deoria, against Maheshwari Khetan Sugar Mills (Private) Ltd. Ramkola, district Deoria, Kedar Nath Khetan and nine others belonging to the three branches of Debi Dutt, common ancestor of the contesting parties to the four proceedings and also against Nagarmal Khetan and the Receiver appointed by the Collector of Bombay in the recovery proceedings against Kedar Nath Mitanand and Hari Ram. It may here be noted that some of the opposite parties are applicants in the other three proceedings and they are apparently pro forma opposite parties in whose interest the application has been made.
(2.) THE Company Judge passed a common order in the first three cases relating to Lakshmi Devi Sugar Mills (Private) Ltd. and a separate order in the case relating to Maheshwari Khetan Sugar Mills (Private) Ltd. The Company Judge allowed all the applications and directed rectification of the registers of members of the two companies by restoring the names of the original share holders as they stood before 2-7-1959. In view of the fact that some of the original share holders had died or ceased to exist, it was left open to the heirs and successors to apply for further rectification in the ordinary way. The persons aggrieved in the tour cases are Kedar Nath Khetan and his adopted son, Gauri Prasad Khetan; Durga Prasad Khetan and Gauri Prasad Khetan; Kedar Nath Khetan, Durga Prasad Khetan, Gauri Prasad Khetan and Smt. Saraswati Bai Khetan; and Maheswari Khetan Sugar Mills (Private) Ramkola, district Deoria, Kedar Nath Khetan, Durga Prasad Khetan and Gauri Prasad Khetan, and they have preferred special appeals which are Nos. 108 to 111 of 1963. As common questions of law and tact arise in all the four appeals they are being disposed of by one common judgment. The parties have filed detailed affidavits-giving the past history of the litigation and the disputes that had occasionally arisen among them. They have naturally tried to blame the other party for the situation in which they are now placed. For purposes of the present appeals it is not necessary to express any opinion on the past conduct of the parties and we shall, therefore merely refer to those facts which are pertinent for the decisions of the appeals leaving it open to the parties to agitate other points in a regular suit. It, however, appears that certain agreements were entered into by the various branches of the Khetan family on 12-8-1957 for the exchange of various blocks of shares such that the branches pulling on well together may manage a sugar factory and the rival branches may have no interest left therein. The-agreements wore not accompanied by formal instruments of transfer of shares nor were suitable corrections made forthwith in the registers of members, as the shares had been attached by the Collector of Bombay in proceedings for the recovery of income-tax dues from the Khetan family. The family owned most of the shares in Ishwari Khetan Sugar Mills-and Maheswari Khetan Sugar Mills and about ¼th shares in Lakshmi Devi Sugar Mills. The agreement was that the shares of the family in Maheswhari Khetan Sugar Mills and Lakshmi Devi Sugar Mills shall go to the group of Kedais-Nath Khetan while the shares of Ishwari Khetan Sugar Mills, to the other group. The shares of Ishwari Khetan Sugar Mills were sold in the recovery proceedings and have been purchased by the relations of the group of the sons of Seth Onkarmal Khetan. The case of this group naturally is that the sale of the shares and the purchase thereof, was fair and honest and it was never represented that the shares belonged exclusively to this group. The case of the group of Kedar Nath Khetan is that the other group had made a representation that by virtue of the agreement the shares of Ishwari Khetan Sugar Mills exclusively belonged to them and by underhand methods the group managed to purchase those shares for a nominal value. This is a material point in controversy among the parties or which we need not express any opinion. These facts have been reproduced here simply to indicate the circumstances in which, according to Kedar Nath Khetan, changes in the registers of members of Maheshwari Khetan Sugar Mills and Lakshmi Devi Sugar Mills were made, the rectification of which has been sought for in the present proceedings.
(3.) THE agreements were entered into on 12-8-1957 and changes were made in the registers of members in the year 1959. The present applications for rectification were made in 1962. The Company Judge has recorded the finding that the agreements of 12-8-1957 were not instruments of transfer and in view of S. 108 of the Companies-Act, 1956 the companies could not make alterations in the registers of members and the alterations, made were consequently unauthorised and illegal; that the transfer of the bulk of the shares in question was illegal and void because they were uncles attachment in pursuance of certificates issued by the Additional Collector of Bombay, and that the remaining shares which had not been attached but had been surrendered to the Receiver appointed by the Collector of Bombay along with blank instruments of transfer could not be registered in the name of any one other than the Receiver himself or a person to whom the Receiver may transfer or may have transferred such shares. The Company Judge was thus of opinion that the alterations made in 1959 in the registers of members were contrary to law and were ineffective. He consequently directed rectification of the registers of members by restoring the names of the original holders as they stood before the alterations were made in 1959.;