P S THIRUMALAI IYENGAR Vs. OFFICIAL LIQUIDATOR SRINIVASA MILLS LTD

JUDGEMENT

(1.) SRINIVASA Mills Ltd. Madurai, was a public limited company, incorporated under the Indian Companies Act on 7-1-1946. A firm of partnership called Srinivasan and co. , was the managing agent of this company. The terms of agreement between the managing agent and the company were reduced to writing and were attached to the articles of association of the company as schedule A. The agreement provided that the managing agents should receive an allowance of Rs. 500 per month form the date of the commencement of the word by the company, and an allowance of Rs. 1000 per month thereafter, after the mill commenced work. At the inception the managing agent firm consisted only of three partners. Sri P. S. Thirumalai Iyengar subsequently became a partner of the managing agency firm under a written agreement with the firm. One of the terms of that agreement was that Thirumalai Iyengar should be the sole managing agent and should be the sole recipient of the remuneration provided for in the managing agency agreement with the company. He took charge of the management of mills on 10-6-1948. The board of directors of the Srinivassa Mills Ltd. , recognised the status of Tirumalai iyengar as the sole managing agent, and in recognition thereof passed appropriate resolution at a duly convened meeting of the Board of directors. The original partners of the managing agency firm raised disputes calling in question the status of Tirumalai Iyengar as the sole managing agent. They institution a suit, O. S. No. 228 of 1949 on the file of the Sub Court, Madurai impleading the company as the first defendant and Tirumalai Aiyangar as the second defendant challenging the right of Tirumalai Aiyangar to function as the sloe managing agent. In that suit the company that he was entitled to function as the sole managing agent of the company. Substantially the contention of Tirumalai Iyengar was upheld in that suit which was ultimately dismissed.

(2.) THE company admittedly did not commence work. In O. P. No 97 of 1955 on the file of the Original side of this court the company was directed to be wound up and the Official Receiver of Madurai was appointed as the Official Receiver of madurai was appointed as the Official Liquidator. Thirumalai Iyangar filed a claim affidavit before the Official Liquidator claiming that a sum of Rs. 47223-12-4 was due to him from the company as remuneration provided for under the managing agency agreement. He claimed remuneration at the rate of Rs. 500 Per month from 1-4-1949 to 26-9-1955. Two of the share-holders of the company resisted the claim. The Official Liquidator, Madurai, held that the claimant was entitled to the remuneration asked for but the claim was barred by limitation in respect of remuneration due beyond three years before the date of the winding up. On this footing the claimant was allowed only a sum of Rs. 18000 as and for remuneration. The claimant preferred C. M. P. No. 296 of 1957 before the District court, Madurai, and contended that he was entitled to remuneration for the whole period as prayed for by him in the claim affidavit. The shareholders who opposed the claim affidavit before the Official liquidator preferred C. M. P. No. 338 of 1957 against the order of the Official liquidator allowing in part the claim of Thirumalai iyengar. The learned District Judge dismissed both petitions and confirmed the order of the Official liquidator. This civil miscellaneous appeal has been preferred by the claimant, Tirumalai Iyengar. The share-holders who contested the claim in the court below have not contested the claim in the court below have not preferred any appeal or cross objections.

(3.) THE only question that arises for decision in this appeal is whether the claim of the appellant to receive remuneration for the period beyond three years prior to the date of the winding up is barred by limitation or not.