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TMI Blog1979 (4) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... al number of subscribed shares of the company are 2,941. Kartar Singh, Naranjan Singh and Jaswant Singh who had 29, 31 and 11 shares, respectively, had died. One Karam Din who held 22 shares had migrated to Pakistan. Leaving these aside, the effective voting strength comes to 2,848 and the number of members owning these shares is 46. Disputes arose regarding the election of the directors of the company. A meeting was held for the election of the board of directors on September 20, 1976. Both parties claimed that they had won. Gurdip Singh and others filed a petition under sections 397, 398 and 399 read with section 402 of the Companies Act (hereinafter referred to as "the Act"), in which they alleged that the members of their group had been elected directors in the meeting held on 20th September, 1976. Saudagar Singh and others respondents mentioned in the petition had taken forcible possession of the buses, the premises and the records of the company in the month of March, 1977. It was also alleged that Saudagar Singh and others were in a minority and they were not entitled to run the affairs of the company; that, on the other hand, Gurdip Singh and others were in a majority of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shareholders that the special meeting of the company will beheld on 2nd June, 1977, at 11 a.m. After due service, the official chairman convened a special general meeting which was attended by the shareholders. Both the groups led by Saudagar Singh and Gurdip Singh Gill attended the meeting. Two proxies had been received from Canada, one by Kartar Singh and another by Rampal Singh, two shareholders. Both the proxies were sent in favour of Gurdip Singh Gill. In fact, the official chairman had received one letter from Kartar Singh, which accompanied two proxies in favour of Gurdip Singh Gill. Rampal Singh also sent a letter along with a copy of the proxy sent to the official chairman, direct to Gurdip Singh Gill. Gurdip Singh Gill produced that proxy, the letter and the envelope before the official chairman at the time of the meeting. Saudagar Singh raised objection to these proxies. The official chairman was satisfied that the proxy sent by Kartar Singh was in order and he allowed the same to be used and hence the votes of Kartar Singh were polled in favour of Gurdip Singh Gill group. However, the official chairman was not satisfied regarding the proxy sent by Rampal Singh. Consequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pal Singh. The signatures on the letter purported to have been sent by Rampal Singh along with the proxy sent to Gurdip Singh also tally with the signatures of Rampal Singh on the two proxies i.e. , one sent to the official chairman and the other to Gurdip Singh Gill. On behalf of the petitioners, an application (C.A. No. 93 of 1977) had been filed in which it had been stated that Rampal Singh, having come to know about the dispute regarding the genuineness of his proxy, sent his affidavit dated 17th June, 1977, duly attested by a Notary Public, wherein he affirmed the genuineness of the proxy dated 14th May, 1977. The original affidavit has been placed on the file as well as the accompanying letter and the envelope. The signatures of Rampal Singh on this document (affidavit) are also similar to the signatures on both the proxies. On behalf of the respondents, it was pointed out to the learned single judge that there was some variation in the signatures of the proxy and the signatures in the proceedings book. The learned judge also noticed a slight difference in the signatures on the two documents. However, the learned judge after thoroughly scrutinizing the same came to the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hands is a common sight. We have ourselves compared the signatures on the two copies of the proxies, the letter addressed to Gurdip Singh Gill, the affidavit, the signatures on the proxy of Kartar Singh and the signatures in the proceedings book and find that they are of one and the same person. Even before us, Mr. Majithia has not challenged the genuineness of the proxy of Kartar Singh. He has not challenged the decision of the official chairman accepting the proxy of Kartar Singh. The proxy of Kartar Singh is attested by Rampal Singh. The signatures on this proxy fully tally with the signatures of Rampal Singh on the proxies purported to be the proxy sent by Rampal Singh. Similarly, the signatures of Kartar Singh on the proxy of Rampal Singh fully tally with the signatures of Kartar Singh on the proxy sent by Kartar Singh to the official chairman, regarding which there is no dispute. Mr. Majithia then pointed out that there are other suspicious circumstances which suggest that the proxy of Rampal Singh is not a genuine document. He argued that in the register of members, the address of Rampal Singh is of a village in Punjab. As such, notice to him and his brother, Jagdish Sing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, records and business, etc., of the company were taken into possession by Saudagar Singh and others. He had not stated that he did not have any document of the company in his possession. Perhaps, he was referring to the current books which were being used from day to day for running the affairs of the company. The proceedings book in question relates to the year 1969-70. For the purpose of the petition under sections 397, 398 and 399 read with section 402 of the Act, this proceedings book had no relevance. The records alluded to in this application pertain to the year 1977. So, there is nothing in the conduct of Gurdip Singh to detract from his veracity. Just to repel the imaginary doubts of the respondents, we made a suggestion to Mr. Majithia that Rampal Singh can be asked to send a fresh proxy executed before some independent and respectable person or authority like some responsible officer in the Indian High Commission. After consulting his client, who was present in court during the hearing of this appeal, Mr. Majithia informed us that he would not be satisfied with this procedure as, according to him, Rampal Singh was under the influence of Gurdip Singh Gill. So taking into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considered and acted upon by this court, these were properly stamped. The official chairman was appointed only to conduct the proceedings of the special meeting to be held to elect the directors. That was the only task assigned to him by the learned company judge. He did not have any authority to receive the evidence under any law. So, when the proxies were produced before him they were not produced in evidence of something. There was no lis pending. When these proxies were received in evidence by the company judge, who had the authority to receive evidence, these were properly and validly stamped. The learned counsel placed reliance on the decision in Tata Iron and Steel Co. Ltd., AIR 1928 Bom. 80, where it had been held that the proxies, which are unstamped and upon which the stamps have not been cancelled, must be excluded and the votes recorded on the authority of such proxies go out. This authority is not applicable to the facts of the present case as the proxy in the present case is properly stamped and it has also been properly cancelled. The scheme of the Stamp Act also suggests that, except in the case of instruments like promissory notes and bill of exchange, etc., an o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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