JUDGMENT Costello, A.C.J. 1. This is an appeal from a judgment of the District Judge of Rangpur dated the 25th January, 1937, reversing an order made by the Subordinate Judge of Rangpur dated the 14th September, 1936. It arises in a matter which is one of a somewhat numerous class of cases which have come before this Court in recent times. It is concerned with a scheme, or more accurately a compromise or arrangement made between a Company and a class of its creditors of the kind which is within the contemplation of sec. 153 of the Indian Companies Act, 1913. The Company was the Badarganj Loan Office, Ltd. and the creditors were the depositors, that is to say, persons who had entrusted money to that Company. Like so many other companies of the same kind, it appears to have got into financial difficulties and, accordingly, towards the end of the year 1932, actually on the 21st November, 1932, the Respondent to the present appeal Sahar Uddin Shah who had a current account with the company served a notice upon the Company requiring thorn to pay to him the amount then owing to him in respect of his account with them. The Company apparently ignored that notice. On the 5th December, an order was made by Mr. Justice Buckland directing that a meeting of depositors should be held for the purpose of agreeing to a scheme if approved, whereby payments of the debts due to the depositors should be postponed. The scheme was of the kind which is very familiar to this Court-a scheme which in all its essentials was exactly on the same lines as a dozen other similar schemes which from time to time have received the sanction of this Court. I have pointed out on a, previous occasion that all these schemes seem to have emanated from one common source. In consequence of the order of the Court made on the 5th December, 1932, it would seem that on the 6th December, 1932, the present Respondent caused his legal adviser to serve another notice on the company peremptorily demanding payment of what was owing to him and giving notice that, in default of payment, legal proceedings would be taken. That notice seems to have been without effect. That notice seems to have been without effect. Consequently, on the 18th December, 1932, a suit was started which in a sense is the origin of the present proceedings. On the 28th December, 1932, a notice was sent out in accordance with the direction given by Mr. Justice Buckland on the 5th December. It seems to have been questioned in the Courts below whether or not a copy of the notice ever reached Sahar Uddin Shah. The learned District Judge has said that the Plaintiff's case was that no notice was served on him. He found, however, that there was a certificate of posting of the notice on the 30th December, 1932, that is to ray, twelve days after the suit was instituted. What apparently happened was that the Company started sending out notices on the 28th December, 1932; but as far as the present Respondent was concerned, the notice was sent out on the 30th of December. The meeting of the depositors was duly held on the 22nd January, 1933, and the scheme was then passed by a requisite majority, that is to say, the majority required by sec. 153 of the Indian Companies Act, being a majority in number representing three-fourths in value of the creditors or class of creditors. Two days later, on the 24th January, 1933, the Company appeared in Court to make answer to the suit instituted by Sahar Uddin Shah. On that date they made an application for time within which they should be allowed to file a written statement. Apparently they had not then filed a written statement, but on the 24th February (?), 1933 they put in a written statement in which they admitted the debt and asked that they should be allowed to liquidate it by installment payments. On the 9th February, they made a further application for time and ultimately on the 24th February, 1933, a decree was made against them in favor of the Plaintiff but allowing payment by certain installments. The first of these installments became due on the 13th April, 1933, but the Company made default. On the 1st May, 1933, the matter of the scheme came before Mr. Justice Panckridge sitting on the Original Side of this Court, and the learned Judge then sanctioned the scheme, as agreed to by the majority of depositors at the meeting held on the 22nd January, 1933. On the 1st May, 1933, the matter of the scheme came before Mr. Justice Panckridge sitting on the Original Side of this Court, and the learned Judge then sanctioned the scheme, as agreed to by the majority of depositors at the meeting held on the 22nd January, 1933. Nothing seems to have been done by Sahar Uddin Shah in the direction of enforcing the decree, which he had obtained on the 24th February, 1933, until the 5th June, 1935, when the execution proceedings were instituted, out of which this appeal has arisen. It is perhaps not without significance that on the 5th March, 1934, there came into existence a decision of this Court, that of Mr. Justice Buckland, In the matter of Dewanganj Bank and Industry, Ltd. 38 C W. N. 1171 (1934) where it was held that a depositor who obtains a decree against a Banking Company before any scheme is embarked upon by the latter, ceases to be a depositor and becomes a decree-holder. Subsequently to the decision of Mr. Justice Buckland, there were a variety of decisions in this Court both on the Original Side and on the Appellate Side dealing with the point whether or not a depositor of the banking companies or loan offices who has obtained a decree was in the same category of creditors as a depositor who was without a decree. Ultimately the point came before the Chief Justice and myself on the 7th April, 1936, in the case of Rajshahi Banking Corporation v. Surabala 40 C, W. N, 1104 (1936) and we then came to the conclusion that a depositor who has obtained a decree and one who has not obtained a decree cannot be regarded as belonging to the same class of creditors for the purpose of sec. 153 of the Indian Companies Act and that accordingly a notice sent to such a decree-holder directing him to attend a meeting of the depositors for the purpose of considering a scheme is not binding on him, as equally as he is not bound by anything which is decided at such meeting. Nothing that has been said in the course of the appeal before us to-day has in any way caused me to think that the decision which was arrived at in that case was not a correct decision. Nothing that has been said in the course of the appeal before us to-day has in any way caused me to think that the decision which was arrived at in that case was not a correct decision. It follows, therefore, that it must be taken for our present purposes that at all material times a depositor with a decree stood in a different category from that of a depositor without a decree. 2. The law has since been altered by the Indian Companies Amendment Act, 1936, which has added some words to sub-sec. (6) of sec. 153 of the Act of 1913: so that it now reads: In this section (sec. 153) the expression 'Company ' means any Company liable to be wound up under this Act, and for the purposes of this section unsecured creditors who may have filed suits or obtained decrees shall be deemed to be of the same class as other unsecured creditors. 3. We have, however, to decide this appeal under the law as it was prior to the year 1936 and so upon the footing that Sahar Uddin Shah, if he had been a decree-holder at the right moment, would have been in a different category from those of his fellow-depositors who had not obtained decrees against the Badarganj Loan Office. One has to consider the dates. In this matter the chronology is of the utmost importance. The essential dates are these:-.the date of the institution of the suit, the date of the meeting of the creditors, the date of the decree, and the date of the sanction of the Court. I have already recited these dates. When one looks at them, one at once sees that at the date of the meeting the position was that the suit had been instituted but it had not yet come to trial and there was, therefore, no decree. At the date of the sanction, however, there was a decree. If the position were that a scheme of arrangement only came into operation on the date when it was sanctioned by this Court, namely, on the 1st May, 1933, then it would be obvious that there was no scheme in existence at the time when the present Respondent obtained his decree. If the position were that a scheme of arrangement only came into operation on the date when it was sanctioned by this Court, namely, on the 1st May, 1933, then it would be obvious that there was no scheme in existence at the time when the present Respondent obtained his decree. But both the Courts below have proceeded upon the looting that the sanction of the Court has relation back or rather has a retrospective effect and, therefore, the scheme operates not from the date on which the sanction was given but from the date on which it was agreed to by the creditors, namely, the date of the meeting which, in the present instance, was the 22nd January, 1933. At that time Sahar Uddin had not yet obtained his decree: he was merely in the position of a depositor who had filed the suit. The filing of the suit of itself gave him no higher rights, or in any way effected a change in his character as creditor as compared with those of the depositors who had not filed suits. Consequently at the date of the meeting, i.e., on the 22nd January, 1933, he was still in the same class of creditors as all the rest of the depositors and as such he was entitled to receive notice of the meeting (which it must be presumed he did in fact receive) and as found by the Appellate Court he was entitled to attend the meeting had he chosen to attend it. He was entitled to express his opinion and to record his vote in the matter. He did not choose to attend the meeting and so did not vote on the scheme. Nevertheless it must be taken, that he was bound by the decision arrived at by the majority of his fellow depositors. It follows that prima facie at any rate he was bound by the scheme and so could not afterwards avail himself of the advantage which the decree he had obtained on the 24th February, 1933, would otherwise have afforded him. It follows that prima facie at any rate he was bound by the scheme and so could not afterwards avail himself of the advantage which the decree he had obtained on the 24th February, 1933, would otherwise have afforded him. That the sanction of the Court has a retrospective effect is, in my opinion, a matter which is not open to doubt, having regard to the decision of the Judicial Committee of the Privy Council in the case of Raghubar Dayal v. Bank of Upper India, Ltd.L. R. 46 I. A, 13: s. c. C. W. N. 697 where so far as the sequence of the dates was concerned, the matter was very much of the same kind as the present case. The relevant dates were these: on the 19th December, 1914, the suit was instituted by the creditor against the Company. On the 21st December, 1914, there was an application for sanction. On the 23rd December, 1914, a meeting of the creditor was ordered. The meeting duly took place on the 4th March, 1915. It is to be observed that up to that date there was no decree. The decree was actually obtained on the 19th April, 1915 and sanction was given to the scheme more than a year later, namely, on the 2nd June, 1916. Lord Haldane who delivered the opinion of the Board said in his opening remarks:- If this was a difficult case, their Lordships would take time before formulating their report. 4. Then the noble and learned Lord sets out sec. 153 of the Indian Companies Act. At page 133 he says:- The question is whether under sec. 153 (which is a section in familiar language practically identical with the corresponding section of the English Companies Act) the creditor was bound. 5. Incidentally I may observe that the corresponding section of the present English Act is curiously enough sec. 153. His Lordship continues:- The Court of the Judicial Commissioner agreeing with the Judge who heard the case in the first instance says that it was so, and it is obvious that it is convenient that it should be so. Otherwise, with the uncertainty as to what the ultimate rule of the Court may be, when a decision has finally been obtained the door would be open for a race between creditors and persons concerned in administering the affairs of the Bank. Otherwise, with the uncertainty as to what the ultimate rule of the Court may be, when a decision has finally been obtained the door would be open for a race between creditors and persons concerned in administering the affairs of the Bank. The Court of the Judicial Commissioner put it very well in its judgment when it said this: If it had been the intention of the legislature that such an agreement should not be binding until the arrangement had been sanctioned by the Court, instead of the words 'if sanctioned by the Court' the words ' when it has been sanctioned by the Court' would ordinarily have been used. The agreement becomes binding from the date when it is arrived at, subject to subsequent sanction by the Court. If that sanction be refused the agreement is without effect. But it is not the case that the agreement is to take effect from the date of sanction. It takes effect from the date when it is made. Such is our interpretation of the words of the section. 6. Lord Haldane adds this comment:- When regard is had to the latter part of the sec. 153 it appears that this is so because the words there are that if the compromise or arrangement which is the compromise or arrangement sanctioned by a majority of the meeting, is passed, then the compromise or arrangement, if sanctioned by the Court, is to be binding. It is the proceeding of the meeting that is to be binding, provided only that it does not fail to be subsequently sanctioned. Therefore not only convenience but the literal Language of the section is in favour of the view to which the Court below adhered, and their Lordships will humbly advise His Majesty that that view should be affirmed. 7. In the light of the opinion of the Judicial Committee of the Privy Council, it is clearly not open to us to take any other view of the matter and therefore we must hold that both the Courts below were quite right in proceeding upon the assumption that the scheme operated as from the date of the meeting, that is to say, from the 22nd January, 1933. I have said that because on the 22nd January, 1933, the present Respondent was not a creditor but only an ordinary depositor who instituted a suit, prima facie, he was bound by the scheme, and he cannot now enforce his decree against the Company. 8. In an attempt, as it seems to me, to meet a hard case, the learned District Judge fell into error. It is hard cases which make bad law however. Therefore, in such cases one has to be particularly careful not to allow one's sympathy with a party (here it is the decree-holder who has obtained a decree for a debt justly due to him) to influence one's decision. Any one who has heard this appeal and or who is cognizant of the facts of this case is, I think, bound to feel some sympathy with the present Respondent: but we have to administer the law as we find it. The learned District Judge in order to assist the Appellant before him, that is to say, the decree-holder erroneously took the view that in some way or other the Badarganj Loan Office were precluded, indeed, were estopped from contending that the decree held by Sahar-Uddin Shah was not executable as against the Loan Office. By some process of reasoning which is not very clear the learned District Judge seems to have thought that the conduct of the Company had been such that they ought not to be heard to say that the decree should not be executed. The exact words used by the learned Judge were these:- The course of this suit in the Civil Court will throw some light on the respective knowledge of both parties and, in my opinion, the conduct of the Bank must be held to be such that it cannot possibly object to the execution of the decree. 9. Later on he said:- it (the Bank) is estopped from saying now that the decree cannot be maintained. 10. The learned Judge seems, to have found himself able to formulate those two propositions by contemplating the action of the Company in putting in a written statement in answer to the claim of Sahar-Uddin Shah in which they admitted their liability yet asked for time within which to pay. 10. The learned Judge seems, to have found himself able to formulate those two propositions by contemplating the action of the Company in putting in a written statement in answer to the claim of Sahar-Uddin Shah in which they admitted their liability yet asked for time within which to pay. The learned Judge seems to have thought that because on the 24th January, 1933, the Company did not meet the Plaintiff's claim by saying something like this "you cannot touch us, because we have got a scheme in the making. That scheme was put before a meeting two days ago; you ought to have been present at the time: you did not appear at the meeting. The scheme has been passed and now we are going to get the sanction of the Court and that will shut you out." Because the Company did not take that sort of attitude, the learned Judge seems to have thought that in some way or other they were for ever precluded from contending that the decree which was subsequently obtained could not be executed. That line of argument was also stressed by Mr. Bagchi on behalf of the Respondent and in support of it he put before us a decision of Mr. Justice Nasim Ali and Mr. Justice R. C. Mitter given on the 9th December, 1936, in a case which is very similar to the present case. The case is described as "Appeal from Appellate Order No. 243 of 1936." A curious feature of it is that no mention is made of the many and varied decisions of this Court on the point which was then under consideration. Whether or not any authority was cited to the learned Judges during the hearing of the appeal on the 1st and 2nd December, 1936, we do not know. Certainly no authority is referred to in the judgment given on the 9th December, 1936. The learned Judges seem to have listened to a discussion as to whether or not the obtaining of a decree by a depositor made any difference as if that were a matter of first impression-a point which up to that time had never been decided. Certainly no authority is referred to in the judgment given on the 9th December, 1936. The learned Judges seem to have listened to a discussion as to whether or not the obtaining of a decree by a depositor made any difference as if that were a matter of first impression-a point which up to that time had never been decided. We find at the end of the judgment this observation: These facts clearly indicate that the Bank all along knew that the scheme was not intended to be binding on the Appellant and in fact did not bind the Appellant. The word ' depositors' in the scheme which was agreed upon in this case and which was ultimately sanctioned by the Court cannot and in fact does not include the Appellant before us. 11. In my opinion, this decision in no way supports the contention that the conduct of the Bank in allowing the depositor to obtain a decree precludes the Bank from afterwards resisting execution. The learned Judges seem to have founded their decision upon the fact that a depositor with a decree is a different person, or rather is in a different class of creditor, from a depositor who has not obtained a decree, and therefore the decree-holder seeking to execute his decree was not bound by a scheme which was agreed to merely by ordinary decree-less depositors if one may so call them. 12. As far as one can see, the question of the doctrine of estoppels as a bar to the Company's objection to the execution was not discussed in that appeal at all. But if it was, with all respect to the learned Judges, I should be bound to say that I could not concur in any such view of the matter, because it must be borne in mind that sec. 153 contemplates an agreement between a Company on the one hand and its creditors or a class of its creditors on the other, and in the present instance, one cannot overlook the rights of the other creditors which would necessarily be affected if the company were precluded from resisting the decree held by Sahar Uddin Shah. 153 contemplates an agreement between a Company on the one hand and its creditors or a class of its creditors on the other, and in the present instance, one cannot overlook the rights of the other creditors which would necessarily be affected if the company were precluded from resisting the decree held by Sahar Uddin Shah. Obviously if the Company were forced to discharge Sahar Uddin Shah's claim the rights of other creditors in the shape of the depositors who had agreed to the scheme would be interfered with, because it is obvious that if this particular creditor be paid in full, the other creditors would suffer. In any case, in my opinion, nothing which the Company did now precludes them from resisting the decree because at the time when they put in the written statement on the 24th February, 1933, it had not then been ascertained and therefore it was by no means certain whether or not the scheme passed and accepted at the meeting of the 22nd January would ultimately receive the sanction of the Court. There was always the possibility that when the matter came before the Court, the Court would refuse to sanction the scheme as has been the case on more than one of such occasions. In those circumstances, it was only reasonable that the Company should Endeavour to make the best terms it could, with the creditor who was the most closely pressing them. I think therefore that there is nothing in the circumstances of the case which shuts out the Company from resisting execution. Therefore although we do so with great reluctance, we are bound to say that the decision of the District Judge is wrong and must be set aside, and the decision of the Subordinate Judge restored. The appeal is, accordingly, allowed. We make no order as to costs. Edgley, J. I agree.