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Issues Involved:
1. Validity of Resolution No. 1 regarding the appointment of additional directors. 2. Validity of Resolution No. 2 concerning the termination of the managing agents. Detailed Analysis: Issue 1: Validity of Resolution No. 1 The primary question regarding the validity of Resolution No. 1 hinges on the interpretation of the company's articles of association, particularly Articles 109 and 126. Article 109 states, "The number of the Directors shall not be less than three nor more than four." However, Article 126 allows the company in a general meeting to "increase or reduce the number of Directors." The Indian Courts held that any increase beyond the maximum of four directors required a special resolution altering Article 109. The judgment, however, interprets Article 126 as allowing an ordinary resolution to increase the number of directors beyond four, despite Article 109's stated limits. The reasoning is that Article 126's power to "increase or reduce the number of directors" implies a broader authority that can override the specific limits in Article 109. The judgment notes that the draftsman of the articles did not include limiting language in Article 126, unlike in Article 111, which explicitly restricts the board's power to appoint additional directors. Thus, the judgment concludes that Resolution No. 1 was valid. Issue 2: Validity of Resolution No. 2 Resolution No. 2 aimed to terminate the appointment of the managing agents, Messrs. Andrew Yule and Co. Ltd., by an ordinary resolution. The relevant articles, particularly Article 132, stipulate that the managing agents can only be removed by an extraordinary resolution passed at an extraordinary general meeting with specific notice requirements and a particular majority. The judgment dismisses the appellants' argument that Section 87-B of the Companies Act allows for the removal of managing agents by an ordinary resolution. Instead, it emphasizes that Section 87-B requires any removal to be approved by a resolution at a general meeting, without altering the need for an extraordinary resolution as per the company's articles. The judgment also rejects the argument that enforcing the managing agents' tenure constitutes specific enforcement of a contract of personal service, clarifying that the decree merely ensures compliance with the articles of association. Consequently, the judgment agrees with the Indian Courts that Resolution No. 2 was invalid. Injunctions and Company Status: The High Court had issued two injunctions based on the invalidity of both resolutions. The first injunction, restraining the defendants from acting as directors, was set aside as Resolution No. 1 was deemed valid. The second injunction, preventing interference with the managing agents, was also discharged, as there was no reason to assume the defendants would act against the declaration of Resolution No. 2's invalidity. The judgment also addresses the company's status in the litigation. Since the appellants were validly elected directors, the company's name as a plaintiff was unauthorized. Therefore, the company was struck out as a plaintiff and added as a defendant to ensure it was formally bound by the order. Conclusion: The appeal succeeded concerning Resolution No. 1 but failed regarding Resolution No. 2. The judgment declared Resolution No. 1 valid, struck out the declaration that the original four directors were the only proper directors, and discharged all injunctions. The company was removed as a plaintiff and added as a defendant. No costs were awarded for the proceedings in either the Indian Courts or on this appeal.
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