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TMI Blog1992 (12) TMI 194X X X X Extracts X X X X X X X X Extracts X X X X ..... with sections 434(1)( e ) and 439 of the Companies Act, 1956 (for short "the Act"). All the petitioners are the creditors of the first respondent company. The substance of the petition is that the first respondent company is unable to pay its debts and that the company is commercially insolvent. The office raised an objection that though a joint petition by 40 petitioners is maintainable, separate sets of court-fee shall be paid in respect of each of the creditors. In another matter, earlier in K.S. Srikantaiah v. Manjog Consultancy Service P. Ltd. (C.P. No. 54 of 1989, decided on May 11, 1989) initially several creditors filed a company petition under section 433( e ) of the Act. The office raised an objection that several credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r was inadequate and that each of the creditors who had a distinct and separate cause of action shall have to pay separate court-fee of Rs. 100 each." It seems subsequently in the said matter, the petition was confined to one of the creditors. However, the two opinions quoted above prima facie reflect two divergent views and accordingly, this matter was referred to the Division Bench. We directed the learned Government advocate to take notice, since the question of court-fee is involved and we have heard the learned Government advocate also. According to the learned Government advocate, section 6 of the Karnataka Court-fees and Suits Valuation Act, 1958, governed the case under which the plaint shall be chargeable with a fee on the ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... those proceedings also would be that of the individual petitioner. A proceeding under article 226 is normally invoked by a person whose individual legal right is sought to be infringed. In fact, the courts have entertained a single writ petition with single court-fee as and when the proceedings are initiated by way of public interest litigation. In the case of public interest litigation, none of the petitioners is expected to pay separate court-fee. The concept of cause of action shall have to be understood by reference to the nature of the proceedings that could be initiated consequent upon such a cause of action. When a company is sought to be wound up because the company is unable to pay its debts, the cause of action arises as and wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the class of creditors having regard to the nature of the proceedings and the effect of the ultimate order that may be made by the court. The nature of the proceedings is brought out by the Chancery Division in Crigglestone Coal Co. Ltd., In re [1906] 2 Ch 327 (Ch. D.) (at page 331) : "A creditor who obtains judgment, and issues execution at law, has a legal right to the means of satisfying his judgment. Subject to qualifications, one of which rests in the fact that the language of the Act is 'may' and not 'shall', and to the reservation which Lord Cranworth made, and subject to what I shall presently say as to the representative position of the petitioner, it seems to me that the petitioning creditor has, as between himself and h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to such right as the majority of the class desire to exercise. This is no exception. It is a recognition of the right, but affirms that it is the right not of the individual, but of the class ; that it is for the majority to seek or to decline the order as best serves the interest of their class. It is a matter upon which the majority of the unsecured creditors are entitled to prevail, but on which the debtor has no voice." Therefore, a company petition is more in the nature of a class interest litigation and not in the nature of a litigation between an individual and the company. Order 1, rule 1 of the Code of Civil Procedure which is applicable provides for joinder of several persons as plaintiffs in one suit. However, Mr. Sunder Kum ..... X X X X Extracts X X X X X X X X Extracts X X X X
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