MAHENDRA KUMAR JAIN Vs. FEDERAL CHEMICAL WORKS LTD
HIGH COURT OF ALLAHABAD
MAHENDRA KUMAR JAIN
FEDERAL CHEMICAL WORKS LTD.
Referred Judgements :-
PANNA LAL V. JAGATJIT DISTILLING AND ALLIED INDUSTRIES LTD.
MANILAL GANGARAM SINDORE V. WESTERN INDIA THEATRES LTD.
MOHIDEEN PICHAI V. TINNEVELLY MILLS CO.
MOHAMED ATHAR V. NARSINGH DAS
MAHADEO LAL AGARWALA VS. NEW DARJEELING UNION TEA CO LTD
Click here to view full judgement.
Satish Chandra, J. -
(1.)THIS is an application under Section 155 of the Companies Act, 1956, for the rectification of the share register of the Federal Chemical Works, Ghaziabad (hereinafter called the company).
(2.)THE company was incorporated as a private limited company in 1936. In December, 1944, it was converted into a public limited company. THE registered office of the company is at Ghaziabad.
Sri Mahendra Kumar Jain, the petitioner, alleges that he is the holder of four hundred A class shares of rupees one hundred each and 7,450 B class shares of rupees ten each in the company since 3oth December, 1948. The petitioner urges that he repeatedly requested Sri Mitter Sain Jain, who is the works manager of the company, to allow him to inspect the share register as he suspected that some interpolation had been made therein. The inspection was not granted. Ultimately the petitioner came to know in December, 1963, from the office of the Registrar of Companies at Kanpur that in the annual return filed by the company on 30th December, 1950, before the Registrar, the petitioner was shown as holding no shares of A class and holding only 550 B class shares in the company.
The petitioner claims that he has not executed any deed of transfer nor has he transferred any part of his holding in favour of any one and it is a mystery how his name has been removed from four hundred A class shares and 6,900 B class shares held by him. It is prayed that the company be directed to enter the petitioner's name in the share register of the company in accordance with the aforesaid holding.
(3.)THE company appears to be a family concern, the shareholders being confined to the petitioner's father, mother, his brothers and their wives. THEse shareholders have been impleaded as parties to this petition and they have filed a counter-affidavit. It is averred that the shares which the petitioner now claims to be his were initially acquired in the years 1945 to 1947 by Sri Mitter Sain Jain, the petitioner's father. At that time the petitioner was a minor and was only a benamidar of Sri Mitter Sain Jain. THE shares were partly paid up at that time. A large sum of money had yet to be paid for them. THE petitioner was not willing to continue to be liable for their payment and as such the petitioner voluntarily transferred the shares at the suggestion of Sri Mitter Sain Jain to respondents Nos. 2 to 6 who are the petitioner's mother and brothers, etc. It is also alleged that the petitioner was a director of the company since 1947 to 1956. He was also the manager of the company and that he attended the meeting of the board of directors of the company held on September 9, 1950, at which the transfer of shares by the petitioner to respondents, Nos. 2 to 6 was approved. It is also suggested that the petitioner was in active management of the company till 1956 and he had access to the books of the company. THE allegation that he did not know of the transfers of the shares in favour of respondents Nos. 2 to 6 till December, 1963, is characterized as false. It is stated that the petitioner knew of the transfer in December, 1950, as he attended the meeting of the board of directors held on September 9, 1950.
The following issues have been framed: " 1. Whether in the year 1950 the petitioner, Mahendra Kumar Jain, transferred 400 A class shares and 6,900 B class shares to his mother, brother and sisters? 2. Whether the requirements of Section 108 of the Companies Act were fulfilled in respect of those transfers? 3. Whether the petition is barred by limitation? 4. Whether the petition is not maintainable on account of its involving complicated questions of title?"
Copyright © Regent Computronics Pvt.Ltd.