1936 (12) TMI 26

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..... this contention. Mr. Sethi has argued the second appeal on behalf of the defendant. The facts, as it is necessary to state them, are that Company called the Kundan Cloth Mills was promoted by Mr. Kundan Lal of Ludhiana. The defendant Mr. Banwari Lal of Delhi signed the memorandum of association and wrote in his own hand that he would take 50 shares. According to Mr. Kundan Lal, he did so on the 18th of January 1933. The same, day Mr. Kundan Lal brought the memorandum and articles of association to Lahore in order to have the Company registered. He took the papers for registration himself to the office of the Registrar of Joint Stock Companies on the 19th of January 1933. The registrar was not there; Mr. Kundan Lal returned to Ludhiana on .....

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..... f his contract to take shares on the ground of the assumed misrepresentation? I think not. Before the incorporation of the company Sims was not the agent of the company, because the company did not exist, and therefore Lord Lurgan could not have been induced to sign for the shares by the misrepresentation of the company or its agent. The contract of the subscriber of a memorandum of association is of a very peculiar kind. Down to the moment when the memorandum and articles are taken to Somerset House to be registered there is no contract at all, because the corporation does not exist, and any contract by the signatories must be with the corporation. At the moment of registration two things take place by force of the Companies Act, 1862, the .....

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..... by Mukerji, J., in Chandler and Co. v. Phillips. The judgments cited by Mr. Sethi in support of his contention all deal with applications for shares 3entirely different principles. I, therefore, dismiss the second appeal with costs. There is, however, one other point. The Senior Sub-Judge in the course of his judgment said, "His ( i.e. , defendants') way of writing (as for example in Ex: P. 1) is sneaking and cringing. He wants, like people of his caste, to earn money and throw risks on others' shoulders". Mr. Sethi asks that these sentences should be expunged. The request is not opposed by Mr. Aggarwal, who indeed supports it. I have had Mr. Banwari Lal's letter Ex: P. 1 read out; it might possibly be called obsequious or wheedl .....

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