9911796707
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Issues Involved:
1. Rectification of the share register of the respondent company. 2. Validity of the meeting called by the petitioner. 3. Delay and default by the company in registering the petitioner's name. 4. Legal standing of the petitioner as administratrix. 5. Rights of directors to refuse registration. 6. Applicability of Section 155 of the Companies Act. Issue-wise Detailed Analysis: 1. Rectification of the Share Register: The petitioner sought an order for rectification of the share register of the respondent company by inserting her name as the holder of 11,825 fully paid ordinary shares and 591 fully paid 7% cumulative preference shares in place of the deceased Mohamad Bashir. The petitioner argued that she had obtained letters of administration for the deceased's estate and had requested the company to register her as the holder of the shares. The company delayed the registration process, prompting the petitioner to seek court intervention. 2. Validity of the Meeting Called by the Petitioner: The petitioner convened a meeting of the board of directors on January 25, 1961, to consider her application for registration. However, objections were raised regarding the validity of the meeting, as the petitioner did not have the authority to call the meeting under the company's articles of association. The meeting was deemed invalid, and no decision was taken on the petitioner's application. 3. Delay and Default by the Company: The company argued that there was no unnecessary delay or default in registering the petitioner's name, as the petitioner's application was received during a period of holidays, and the company had informed the petitioner that her application would be considered at the next board meeting. However, the court found that the company's actions, including the illegal closure of the share transfer book and the lack of a proper meeting to consider the petitioner's application, constituted "default" as defined by Bowen L.J. in In re Young & Harston's Contract, meaning not doing what is reasonable under the circumstances. 4. Legal Standing of the Petitioner as Administratrix: The petitioner described herself as administratrix to the estate of Mohamad Bashir. The company argued that under Section 153 of the Companies Act, no notice of any trust could be entered on the register of members. However, the court found that the petitioner had complied with Regulation 26 of Table A in Schedule I to the Companies Act, and as the legal representative of the deceased, she was entitled to be registered as the holder of the shares. 5. Rights of Directors to Refuse Registration: The company contended that the directors had the right to refuse registration under Regulation 26(2) of Table A, which gives the board the same right to decline or suspend registration as it would have had if the deceased had transferred the share before his death. The court noted that while directors have discretion to refuse registration, this power must be exercised reasonably and not wantonly or capriciously. In this case, the court found no valid reason for the refusal to register the petitioner's name. 6. Applicability of Section 155 of the Companies Act: The company argued that Section 155 of the Companies Act was not applicable as the petitioner had not yet become a member of the company. The court, however, held that Section 155(1)(b) applies when "default is made" or "unnecessary delay takes place" in entering on the register the fact of any person having become or ceased to be a member. The court found that the petitioner had become entitled to be a member and that the company's actions constituted "default," making the application under Section 155 maintainable. Conclusion: The court ordered the rectification of the share register by inserting the petitioner's name as the holder of the shares in place of the deceased Mohamad Bashir. The company was directed to pay the costs of the application.
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