1933 (2) TMI 10 - HC - Companies Law

Winding up Liability as contributories of present & past members and Company Membership of

Issues: Liability of son for father's debt, Liability of son as a legal representative, Interpretation of Indian Companies Act

Issue No. 1:
The court analyzed the evidence presented by the witness, Shiam Lal, regarding the signing of the memorandum of association by Jagmohan Ram. The court held that Shiam Lal's testimony was sufficient to establish Jagmohan Ram's liability for the shares he subscribed to. The court emphasized that the witness's statement was clear, and any ambiguity could have been addressed through cross-examination if necessary.

Issue No. 2:
This issue was deemed irrelevant as the court had already established, based on the evidence, that Jagmohan Ram had indeed signed the memorandum of association as attested by Shiam Lal.

Issue No. 3:
The court had previously determined that members of the joint family, other than the son, were not liable. The liability of the son, Ram Lakhan, was to be considered in connection with the next issue.

Issue No. 4:
The court examined Section 160 of the Indian Companies Act to determine the liability of Ram Lakhan as the legal representative of Jagmohan Ram. The court discussed the concept of pious obligation in Hindu Law regarding the payment of a father's debt from family property. The court concluded that Ram Lakhan's liability extended only to the separate property of Jagmohan Ram in which no other person had an interest during Jagmohan Ram's lifetime.

Issue No. 5:
This issue did not require any decision based on the circumstances of the case.

Issues Nos. 6 and 7:
No evidence was presented to show that Jagmohan Ram's shares were forfeited or sold and re-allotted to other persons.

Issue No. 8:
There was insufficient evidence to substantiate this issue.

Issue No. 9:
This issue was not argued before the court.

Issue No. 10:
The court rejected the argument that Jagmohan Ram, by virtue of his death, ceased to be a member of the company and thus relieved of liability. The court held that Jagmohan Ram's estate remained liable even after his death.

Issue No. 11:
The court addressed the argument that Jagmohan Ram's failure to pay for the shares subscribed rendered him liable only to a suit for specific performance. The court interpreted Section 30 of the Indian Companies Act and concluded that by subscribing to the memorandum of association, Jagmohan Ram became a member of the company.

Issue No. 12:
In light of the court's findings on previous issues, this issue was deemed irrelevant. The court did not find the joint family property liable in the hands of Ram Lakhan and other family members.

The court ultimately directed Ram Lakhan to be placed on the list of contributories for 151 shares and held him liable as the legal representative of Jagmohan Ram. The court also addressed the costs related to the appointment of a guardian ad litem for Ram Lakhan, attributing the responsibility to those who paid the sum into court.

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