9911796707
|
Home
Issues:
1. Interpretation of a scheme of arrangement and compromise under Section 153, Companies Act. 2. Whether depositors who obtained decrees against a company form a separate class of creditors. 3. Retroactive application of an amendment to Section 153 of the Companies Act. Analysis: 1. The appeal was filed by the decree-holder against an appellate order affirming the objection raised by the Bank regarding the execution of the decree under Section 47, Civil P. C. The appellant had obtained a decree against the Ulipur Bank Ltd. The Bank had financial difficulties and proposed a scheme of arrangement and compromise under Section 153, Companies Act, which was sanctioned by the Court. The scheme provided that creditors could not demand immediate payment but had to adhere to the terms of the scheme for ten years. 2. The Bank contended that the decree-holder could only claim payment in accordance with the scheme and not otherwise. The appellant argued that as a decree-holder, not a depositor at the time of the scheme, he was not bound by it. The key issue was whether decree-holder creditors formed a separate class from other creditors and if a separate meeting was required to bind them to the scheme. Judicial opinions varied on this matter, with some cases supporting the inclusion of decree-holders in the scheme without a separate meeting and others requiring a separate meeting for decree-holder creditors. 3. The Companies Act was amended in 1936, explicitly stating that unsecured creditors with decrees were of the same class as other unsecured creditors for the purpose of the scheme. The appellant argued that the amendment should not apply retrospectively to the decree obtained in 1933. However, the Court held that the amendment clarified the existing law and related back to the original Act. Therefore, the Courts below were correct in their interpretation. 4. The appellant further contended that the Bank was precluded from objecting to the execution due to a previous execution case where no objection was raised. However, this point was not addressed in the lower courts' judgments, and there was insufficient evidence to support it. Consequently, the appeal was dismissed, and no costs were awarded. This judgment clarifies the application of a scheme of arrangement and compromise under the Companies Act, the classification of decree-holder creditors, and the retroactive effect of statutory amendments on existing decrees.
|
