1940 (10) TMI 15 - HC - Indian Laws

Summary

Issues Involved:
1. Maintainability of the suit.
2. Legality of the meetings held in 1936, 1938, and 1939.
3. Validity of the managing committee's actions and elections.
4. Legality of the loans and mortgage agreements entered by the managing committee.

Issue-wise Detailed Analysis:

1. Maintainability of the Suit:

The primary issue addressed was whether the suit as framed was maintainable. The defendants argued that the society was not a party to the suit, and the allegations amounted to an irregularity in the internal management of the society, not ultra vires acts. The Court agreed, noting that the plaintiff could not maintain the suit alone or on behalf of other members without the society being a party. The Court referenced "Foss v. Harbottle" and "Mozley v. Alston," establishing that actions to redress wrongs done to a society should be brought by the society itself unless the wrongdoers control the society and prevent such action. The plaintiff's reliance on "Nariman v. Municipal Corporation of Bombay" and "Pender v. Lushington" was dismissed as inapplicable. Consequently, the Court held that the suit was not maintainable without the society as a party.

2. Legality of the Meetings Held in 1936, 1938, and 1939:

1936 Meeting:
The plaintiff initially challenged the 1936 meeting but withdrew the challenge, acknowledging the defendants were duly elected for 1936-37-38.

1938 Meeting:
The plaintiff contended that the 1938 meeting lacked a quorum. The Court found that only six members were eligible to vote, and four attended, thus meeting the quorum requirement. The Court dismissed the plaintiff's contention that the meeting was illegal.

1939 Meeting:
The plaintiff argued that the 1939 meeting was improperly convened and the business transacted was extraordinary. The Court held that the meeting was properly convened under by-law 10, and the resolutions passed, though not routine, were valid. The Court found that the requisition for the meeting was proper, as it included five eligible members out of ten, satisfying the by-law requirement.

3. Validity of the Managing Committee's Actions and Elections:

The plaintiff challenged the managing committee's constitution and actions, including the election of new members in 1938 and 1939. The Court found that the 1939 meeting ratified the actions and elections of the managing committee, making the plaintiff's challenges moot. The resolutions passed at the 1939 meeting validated the committee's actions and elections, rendering the plaintiff's contentions invalid.

4. Legality of the Loans and Mortgage Agreements:

The plaintiff sought declarations that loans raised and the mortgage agreement with Hirji Laxmidas were unauthorized. The Court found that these actions were within the powers of the society and were ratified by the 1939 meeting. Therefore, the loans and mortgage agreements were binding on the society.

Conclusion:

The Court dismissed the plaintiff's suit with costs, concluding that the suit was not maintainable without the society as a party, and the actions and elections of the managing committee were valid and properly ratified by the 1939 meeting.