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Siri Kishan Talwar Vs. Jawahar Singh Bikram Singh Private Limited - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtDelhi High Court
Decided On
Case NumberCompany Appeal No. 289 of 1972
Judge
Reported inILR1973Delhi696
ActsCompanies Act, 1956 - Sections 397; Code of Civil Procedure (CPC), 1908 - Order 1, Rule 10
AppellantSiri Kishan Talwar
RespondentJawahar Singh Bikram Singh Private Limited
Advocates: Satish Chander,; M.C. Anand and; R.C. Beri, Advs
Excerpt:
.....transferred to this court on 29-10-1966. it was mentioned in paragraph 6 of the petition that kishan talwar and his wife (the present applicant) had along with the other proforma respondents 8 and 9 as well as one jaswant singh had all of them given their consent to the filing of the petition, and held more than l/10th of the issued share capital. (7) after this case was transferred to this court from the company tribunal before which it was initially filed, a contention had been raised that the consent given by srimati sharda talwar, the present applicant, as well as by darshan singh and jaswant singh did not satisfy the requirements of section 399 of the companies act. no authority has been cited to show that the petitioner cannot be transposed as petitioner in spite of the.....s. rangarajan, j.(1) the applicant, srimati sharda talwar, is the widow of kishan talwar who died on 22-2-1972 pending company petition no. 90 of 1967, which was instituted in this court under sections 397 and 398 of the companies act. she herself having been imp leaded as a respondent in c.p. 90 of 1967 with whose consent the petition was filed, she wants to be transposed as a petitioner in place of her deceased husband. (2) this application is opposed on the ground that the petitioner's husband had claimed certain personal rights with regard to his appointment as managing director of the company which right could not be claimed by his widow on his death. another objection is that she can only bring a fresh application under sections 397 and 398 of the companies act. yet another.....
Judgment:

S. Rangarajan, J.

(1) The applicant, Srimati Sharda Talwar, is the widow of Kishan Talwar who died on 22-2-1972 pending Company Petition No. 90 of 1967, which was instituted in this Court under sections 397 and 398 of the Companies Act. She herself having been imp leaded as a respondent in C.P. 90 of 1967 with whose consent the petition was filed, she wants to be transposed as a petitioner in place of her deceased husband.

(2) This application is opposed on the ground that the petitioner's husband had claimed certain personal rights with regard to his appointment as Managing Director of the company which right could not be claimed by his widow on his death. Another objection is that she can only bring a fresh application under sections 397 and 398 of the Companies Act. Yet another objection raised is that the applicant and her husband have major sons who have not been sought to be imp leaded.

(3) Shri Satish Chandra, learned counsel for the applicant, had made it clear that the applicant has sought to be transposed as a petitioner only on the ground of already having been imp leaded as a respondent. She being a shareholder claims that the application which her deceased husband had filed was also one on her behalf. He further states that in a petition under sections 397 and 398 only the factors obtaining at the time of the presentation of the said petition are relevant and not what takes place later.

(4) The petition was filed before the Companies Tribunal, New Delhi, and was subsequently transferred to this court on 29-10-1966. It was mentioned in paragraph 6 of the petition that Kishan Talwar and his wife (the present applicant) had along with the other proforma respondents 8 and 9 as well as one Jaswant Singh had all of them given their consent to the filing of the petition, and held more than l/10th of the issued share capital. That all these persons put together held more than l/10th of the issued share capital is not disputed before me. All that is contended is that the remedy of the present applicant is only to file another petition but not ask for being transposed as a petitioner.

(5) The following reliefs had been sought for in addition to a declaration that Kishan Talwar continued to be the Managing Director of the company:

1.Respondents 2 and 3 be removed from managing or taking part in the affairs of the company; 2.Respondents 6 and 7 be removed from the Directorship of the company; 3. A Chartered Accountant of reputation be appointed to go into the accounts of the company from 1-4-1956 By reason of the death of Kishan Talwar the following reliefs which had been prayed for could not be granted : 1. It be declared that the petitioner, Kishan Talwar, continued to be the Managing Director of the company; 2. The petitioner be put in charge of the affairs of the company.

(6) According to Form 43 prescribed by the Companies (Court) Rules the names and addresses of the members who had given their consent to the petition being presented on their behalf must be mentioned in a separate Schedule. Where the petition is presented on behalf of the members set out in the Schedule, letters of consent given by them to the filing of the petition should also be annexed to the petition, the requirement of the Rules being that the names of those persons (who had consented to the petition being presented on their behalf) should be mentioned in the Schedule. The petition which was presented by Kishan Talwar has thus to be taken as a representative petition filed not only on his own behalf but also on behalf of the persons, who along with Kishan Talwar held share of more than I/I 0th value of the issued share capital and had consented to the said petition being filed.

(7) After this case was transferred to this court from the company tribunal before which it was initially filed, a contention had been raised that the consent given by Srimati Sharda Talwar, the present applicant, as well as by Darshan Singh and Jaswant Singh did not satisfy the requirements of Section 399 of the Companies Act. This Section refers to members of the company holding not less than l/10th of the issued share capital of the company alone being permitted to apply. S.K. Kapur, J. by his order dated 26-11-1968 observed that the petition could not be thrown out on any such ground.

(8) Even apart from this, I can find no sufficient reason to think that a person on whose behalf a petition is filed, in the event of the death of the person who filed the petition, cannot ask for being transposed as petitioner. No authority has been cited to show that the petitioner cannot be transposed as petitioner in spite of the petition having been filed on her behalf as well and she had given her consent to the same being filed on her behalf. Rule 6 provides for the Code of Civil Procedure applying to proceedings under the Companies Act save as provided by the Act or by these Rules. Rule 9 gives inherent power to the court to give such directions or pass such order as may be necessary to meet the ends of justice or to prevent abuse of the process of the Court.

(9) It has been held in Rajahmundry Electric Supply Corporation Ltd. Vs . A. Nageshwara Rao : [1955]2SCR1066 that the validity of petition presented under the Companies Act must be judged in the light of facts subsisting at the time of presentation of the petition and a petition which was valid when presented cannot, in the absence of a provision to that effect in the statute, cease to be maintainable by reason of events subsequent to its presentation. This decision was followed by the Punjab High Court in Jagdish Chand Mehra v. New India Embroidery Mills A.I.R. (1946) Pun 401 which arose out of an application under Sections 397/398 of the Companies Act. Three of the petitioners out of four having compromised with the company, withdrew from the petition with the result that the remaining sole petitioner did not possess the required shareholding qualification for filing a petition. S.B. Capoor, J. held that the sole petitioner who remained after three others had compromised with the company was entitled to carry on with the said petition. I am in respectful agreement with the said decision.

(10) In these circumstances the prayer in C.A. 289 of 1972 is granted. The applicants name shall be struck off from among the respondents and she be transposed as the second petitioner in C.P. 90 of 1967. There will be no order as to costs.


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