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Issues Involved:
1. Validity of the application for allotment of 50,000 shares. 2. Whether the application was accompanied by the requisite application money. 3. Validity and communication of the allotment of 50,000 shares. 4. Effect of the resolution dated 28th February 1963 canceling the allotment of 50,000 shares. 5. Estoppel against the petitioner due to acquiescence or delay. 6. Liability of respondent No. 4. 7. Relief sought by the petitioner. Detailed Analysis: Issue 1: Validity of the Application for Allotment of 50,000 Shares The court examined whether there was a valid application for the allotment of 50,000 shares. The petitioner claimed he applied only for 500 shares and denied applying for 50,000 shares. The court found that the only application on record was filled in without the petitioner's concurrence or knowledge, indicating no valid application for 50,000 shares existed. Issue 2: Application Accompanied by Requisite Money The petitioner contended that he did not provide any cheque for Rs. 5 lakhs for 50,000 shares, but only Rs. 5,000 for 500 shares. The court noted that the application for 50,000 shares was not accompanied by the requisite application money, as the cheque for Rs. 5 lakhs was never sent to the bank for collection, unlike the cheque for Rs. 5,000 which was cashed. Therefore, the court concluded that the application was not accompanied by the requisite money. Issue 3: Validity and Communication of Allotment The court examined whether there was a valid allotment of 50,000 shares and if it was communicated to the petitioner. It was established that there was no communication of such an allotment to the petitioner. The court cited that without communication, there was no acceptance, and thus, no concluded contract. Therefore, the court found that there was no valid allotment of 50,000 shares to the petitioner. Issue 4: Effect of the Resolution Dated 28th February 1963 The court considered the resolution dated 28th February 1963, which canceled the allotment of 50,000 shares. The court referred to precedents that a company could rectify its register without a court order if the right to rectification was recognized by the company. The court found that since the resolution was passed before the winding-up petition, it was valid and effective in canceling the allotment. Issue 5: Estoppel Due to Acquiescence or Delay The court examined whether the petitioner was estopped from seeking rectification due to acquiescence or delay. The court concluded that since there was no valid allotment of 50,000 shares, the petitioner could not be estopped from seeking rectification. The court emphasized that there was no contract to begin with, and thus, no estoppel could be pleaded against the petitioner. Issue 6: Liability of Respondent No. 4 This issue was not argued before the court, and the court found no basis for it in the present petition. Therefore, the court did not see how this question arose in the context of the petition. Relief The court directed that the register of members should be rectified to reflect that the petitioner did not subscribe for 50,000 paid-up equity shares but only 500 paid-up shares. The Official Liquidator was instructed not to place the petitioner on the list of contributories. Conclusion: The court found that there was no valid application or allotment of 50,000 shares to the petitioner and that no contract existed for such shares. The resolution canceling the allotment was valid, and the petitioner was not estopped from seeking rectification. The court ordered the rectification of the register of members to show only 500 shares allotted to the petitioner and directed the Official Liquidator not to list the petitioner as a contributory. The petition was accepted without costs.
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