9911796707
|
Home
Issues: Validity of indorsement by agents of liquidators, question of ratification
Validity of indorsement by agents of liquidators: The judgment revolves around the validity of indorsements made by agents of liquidators in connection with promissory notes. The court highlighted that the power of liquidators to indorse promissory notes is derived from the Indian Companies Act, specifically clause (f) of Section 179. It emphasized that a statutory power cannot be delegated in the absence of a statutory provision for such delegation. Referring to a previous case, the court held that indorsements by agents appointed by the liquidators do not convey any legal title to the assignees. The judgment clarified that in the absence of a statutory provision for delegation, the indorsement by agents is invalid, leading to the dismissal of the revision petition. Question of ratification: The judgment also addressed the issue of ratification concerning the indorsements made by the power-of-attorney agents. It mentioned a case law and highlighted that an act done by a director in excess of his authority may be ratified by a majority vote of the shareholders under certain conditions. However, the court emphasized that the general rule states that only an act capable of being done by an agent can be ratified by the principal. It rejected the argument that a distinction should be drawn between cases where the principal decided the matter and cases where the power-of-attorney holder signed on behalf of the principal. The court concluded that there was no evidence to show that the liquidators themselves had decided to make the assignment, leading to the dismissal of the revision petition on the grounds of ratification. Both revision petitions were ultimately dismissed with costs, as there was no valid indorsement by the agents of the liquidators, and the question of ratification was not substantiated.
|
