9911796707
TMI Blog1961 (9) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner's solicitors on January 20, 1961, wrote to the respondent company requesting the company to insert the petitioner's name in its share register as the holder of the said shares. Between the 21st and the 24th January, 1961 the company did not take any steps in the matter. On January 24, 1961, a meeting of the board of directors was called to be held on January 25 to consider the petitioner's application. At the meeting in which five directors were present including the petitioner, she requested the chairman to enter her name in the share register in the place of Mohamad Bashir. Thereupon Manzoor Ahmed, one of the directors, objected to the proposal on the plea that the meeting had not been properly called. The other directors also refused to do anything in the matter and vacated the room at the request of Manzoor Ahmed. On December 24, 1960, the company's directors resolved to hold the annual general meeting on February 9, 1961. According to the petitioner the object of the other directors was to prevent the petitioner from exercising her votes in respect of the shares held by Mohamad Bashir at the annual general meeting. They are determined not to insert the petitioner's n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this application or to represent his case before me. I rejected his prayers on grounds stated in my judgment on Manzoor's application. I have now to deal with the arguments advanced by the learned counsel for the company and the petitioner. On behalf of the company it has been urged that letters of administration were obtained by the petitioner from this court on the 20th January, 1961. On the 21st January, the petitioner's solicitor's letter asking for registration was received by Sudhir Chandra Dutta, the company's accountant. It was the Saraswati Puja day. The 22nd January was a Sunday. On the 23rd January also the company's office was closed on account of Netaji's birthday. On the 24th January the petitioner's solicitor's letter reached the Calcutta office of the company, but on that day the petitioner sent telegrams to the directors convening a meeting of the board on the 25th. The petitioner had no right to call this meeting as under article 45 of the articles of association only the managing agents could convene such a meeting. This article provides further that the managing agents shall also on the requisition of one-third of the directors proceed to call a directors' re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmed of the death of Mohamad Bashir and the grant of letters of administration to the petitioner. It is stated that the petitioner has become entitled to the shares and to get herself registered as holder thereof and having become so entitled she has elected to be registered as the holder of the shares in her name. The original letters of administration, the share scrips and a notice in writing addressed by the petitioner to the company stating that she elects to be registered are forwarded to the company. The solicitors have also stated as follows: "We are instructed that the next annual general meeting of the company is going to be held on the 9th February, 1961. The ordinary shares enclosed herewith are a substantial portion of the issued ordinary shares of the company having voting rights and our client desires that her name should be recorded in the register of members of the company in time to enable her to vote at the next annual general meeting of the company in respect of such shares." It may be relevant in this connection to refer to regulation 26 in Table A in Schedule I to the Companies Act which runs thus: "26. (1) Any person becoming entitled to a share in conse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ime. (2) If the register of members....is closed without giving the notice provided in sub-section (1), or after giving shorter notice than that so provided, or for a continuous or an aggregate period in excess of the limits specified in that sub-section, the company, and every officer of the company who is in default, shall be punishable with fine which may extend to five hundred rupees for every day during which the register is so closed." No notice as envisaged by section 154 was given by the company; and on the 28th January, 1961, the company writes to the petitioner solicitors that their client's application for registration will be placed at the next meeting of the board of directors for necessary action. The second and third paragraphs of this letter are as follows; "It may also be informed that the share transfer book of the company has been closed from 26th January, 1961, to 9th February, 1961, both days inclusive, as the annual general meeting of the shareholders of the company will be held on 9th February, 1961. The decision of the board of directors will be communicated to you in due course." It is clear from the company's letter of the 28th January 1961, that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itors of the company who were also the holders of 1,000 fully paid up shares, in order to secure full voting powers at the meeting, made nine transfers of 100 shares each, to as many nominees of their own, and sent them for registration; but the company refused to register the transfer. On motion on behalf of the transferor under the 35th section of the Companies Act, 1862, the company were ordered to register the transfers in time to enable the transferees to vote at the meeting. It may be noted that notices of the extraordinary general meeting were signed by the secretary on the 16th July, 1873, and the meeting was to be held on the 28th July. On July 23, 1873, the nine transfers aforesaid were made. A correspondence followed and registration was refused. The court was moved on Saturday, the 26th July, and it was ordered by Sir James Bacon V. C. that the registration was to be made before the meeting was held on the Monday following. Learned counsel for the company was arguing that under section 285 of the Act, a meeting of the board could be held at specified intervals. There was no obligation on the part of the company to hold a meeting to consider only the petitioner's appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er that the share register and/or register of members of the respondent company be rectified by inserting the name of "your petitioner as the holder of the said .shapes in the place and stead of the said Mohamad Bashir ..". THE these circumstances it would be improper to reject the application on this ground. Then it was suggested on behalf of the company that an administratrix stands on a different footing from an executrix. An executor is a personal representative, but an administrator is not. My attention was drawn to article 29 of the English Table A (at page 816 in Buckley on the Companies Acts, 13th edition). This article provides that, in the case of the death of a member, the survivor or survivors where the deceased was a joint holder and the legal personal representative of the deceased where he was a sole holder, shall be the only persons recognised by the company as having any title to his interest in the shares; but nothing contained in the article shall release the estate of a deceased joint holder from any liability in respect of any share which had been jointly held by him with other persons. Similar are the provisions of regulation 25 in Table A in Schedul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case may be, of a deceased person is his legal representative for all purposes, and all the property of the deceased person vests in him as such. " Regulation 25 in Table A in the Indian Act lays down that on the death of a member, the survivor or survivors where the member was a joint holder, and his legal representatives, where he was a sole holder, shall be the only persons recognised by the company as having any title to his interest in the shares. The petitioner in the instant case is the legal representative so long as the letters of administration stand un-revoked, of Mohamad Bashir and shall be the only person recognised by the company. The next contention of the company is that in a dispute between the company and the applicant the court very often interferes. But in an application involving the rights of third parties, the court as a matter of principle does not interfere. This argument was obviously advanced in the context of the claim made by Manzoor Ahmed. As I have dismissed his application to be added as a party to the present application or to represent his case before me, there are no third parties whose interests have to be taken into consideration. The confl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shares not fully paid up and may decline to recognise any instrument of transfer unless a fee of Rs. 2 is paid to the company in respect thereof and the instrument of transfer is accompanied by the certificate of the share to which it relates and such evidence as the board may reasonably require." In view of the provisions of article 24 of the articles of the Vidyasagar Cotton Mills Ltd., I do not consider that the principles invoked by the learned counsel for the company are applicable to the facts of this case. Lastly, it was contended on behalf of the company that the present application does not come within the scope of section 155 of the Companies Act at all. Learned counsel argued on the distinction between section 111 and section 155. According to him, when a person has already become a member, but default is made or unnecessary delay takes places in entering him on the register, section 155(1)( b ) may be attracted; but not otherwise. The expression "having become a member" has been used in the Indian Act but it is not there in section 116( b ) of the English Act. So long as the share of a deceased member remains standing in his name, his representatives do not become ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tanding any previous order of the Central Government. It would be meaningless to give the court a general power to decide any question including any question relating to the title of a person as is given by section 155(3) and then indirectly cut off that power by giving the Central Government the same power to decide the same question in appeal first. Section 111 may have given a speedy remedy in cases which should not normally come to court, but the power of the court to order rectification of the register of members under section 155 remains, in my opinion, unaffected by section 111. Indeed sub-section (3) of section in provides that the party may appeal to the Central Government. It is not incumbent upon the party to prefer this appeal and it may very well choose to come directly to the court. It is true that sub-section (2) of section 41 of the Act provides that every person (apart from subscribers of the memorandum) who agrees in writing to become a member of a company and whose name is entered in the register of members shall be a member of the company. It seems to me that this definition cannot be applied to the expression "any person having become a member" in section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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