9911796707
TMI Blog1943 (2) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... to be payable as unpaid call money in respect of certain shares. The defendant No. 2, Sarat Kumari Debi, is the registered holder of the shares in the books of the Company while defendant No. 1, Satish Chandra Chakravarti, is her husband. The plaintiff's case was that the wife was a mere benamidar for the husband in respect to these shares and there was a prayer in the plant for a decree against both the husband and the wife. There was another question raised in the suit regarding the legality of a certain resolution which was passed at a general meeting of the share-holders held on 28th October, 1934. It appears that the Company had entered into a scheme of composition with its creditors under section 163 of the Indian Companies Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accepted. The whole scheme of the Companies Act seems to be that the Company has got to proceed on the basis of its own register of members and it is neither obliged nor competent to enquire into the rights of other persons whose names are not entered in it. Under section 30 of the Indian Companies Act a person cannot be made a member of a Company unless his name is entered in its register as a member. Section 31 lays down how a Company has got to keep its register of members and what particulars the register should contain. There is no provision under which the Company can make an entry in its register to the effect that shares are held by a particular member only in a representative capacity, or that some other person has a lien or equita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bers. It is a settled principle of English law that it is only the registered holder of a share who can be made liable in respect of anything unpaid on the share and it makes no difference whether he is the beneficial owner of the share or a mere trustee, and in the latter case, it is immaterial whether the Company is or is not cognizant of the trust. [Vide Chapman and Bather's case [1867] 3 Eq 361] . The cestui que trust cannot be made liable either as share-holder or as a contributory [ Cree v. Somervail [1879] LR 4 AC 648] . The same principle has been adopted by English Courts in a large number of cases and by way of illustration we may refer to the decisions in The Societe Generate De Paris v. The Tramways Union Company Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of a beneficial owner in this case and not only he has not given notice of his interest in the shares to the Company but on the other hand has disclaimed all interest in the same. If the Company after receiving notice that the husband had any interest in the shares had entered into a business transaction in respect to the shares, ignoring the Tights of the husband, of which it received notice, the principle laid down in the above cases might possibly be attracted. In that case it would not be a question of binding the Company with a trust but of affecting it as a trader with notice of the rights of third parties. The case of Dharwar Bank, Ltd. v. Mahomed Hayat [1939] 33 Bem LR 250 , upon which stress has been laid by the learned Ad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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