word “just and equitable” - Indian Laws - General

Interpretation of word just and equitable The origin of just and equitable clause in Company law, is traceable to the law of partnership, which developed the conceptions of probity, good faith and mutual confidence Ebrahimi vs. Westbourne Galleries Ltd.; (1972) 2 WLR 1289 . The principle behind just and equitable clause, in the words of the House of Lords is that equity always does enable the Court to subject the exercise of legal rights to equitable considerations . In other words, equitable considerations get superimposed on statutorily governed legal rights under this clause. It is well settled that the words just and equitable in the legislation specifying the grounds for winding up by the Court, are not to be read as being ejusdem generis with the preceding words of the enactment. They are not to be cut down by the formation of categories or headings under which cases must be brought if the enactment is to apply Para 359, Vol. XVI, Fifth Edition (2017) of Halsbury s Laws of England . But apart from cases, (i) where there is something in the history of the company or in the relationship between the shareholders; or (ii) where there is functional deadlock of a paralysing kind; or (iii) where there is justifiable lack of confidence, which may give rise to a petition for winding up on just and equitable clause, there have also been other cases at least before the Courts in England, some of which are listed in paragraph 360 of Volume 16 of the Fifth Edition (2017) of the Halsbury s Laws of England. Two of them are (i) where the company is a bubble company; and (ii) where the company is fraudulent in its inception and carries on at a loss without a capital of its own. [ DEVAS MULTIMEDIA PRIVATE LTD.- 2022 (1) TMI 774 - SUPREME COURT]