JUDGMENT Malik, J. - This case has had a chequered history. One Ali Tamkin executed a mortgage for Rs. 5000 in favour of Bhagwan Das on 10-6-1922. Various payments were made by or on behalf of the mortgagor till 5-11-1926. For the balance of the amount, a suit NO. 9 of 1934 was filed by Bhagwan Das in the Court of the Subordinate Judge of Bijnor, district Moradabad, on 29-5-1934. Ali Tamkin had died before the filing of the suit and Bhagwan Das impleaded as defendant to the action various relations of Ali Tamkin who were his legal representatives under the Muhammadan law. One of such persons who was impleaded was Syed Ali Yakin, son of Ali Hasan. Ali Yakin was impleaded as a major and no prayer was made in the plaint for appointment of his guardian. On the date of suit he was above eighteen years of age but his mother had been appointed a certificated guardian and under the law he was, therefore not a major till he had attained the age of twenty one. The suit does not appear to have been contested and it was decreed ex parte. AH Yakin became a major, that is, completed the age of twenty one, on 26-8-1936. He filed a Suit No. 3 of 1940, for setting aside the decree obtained against him in Suit No. 9 of 1934 on the ground that he was a minor and that all the proceedings against him were not binding and were nullities. The suit was decreed on 26-4-1940. The operative portion of the judgment is as follows : By way of result it is ordered that suit for declaration is decreed such vise that it is declared that Decree No. 9 of 1934 of the Court of the Civil Judge Bijnor is not binding on the plaintiff and that the plaintiff is readmitted to his original rights. Either of the two parties may apply for the revival of the said previous suit of 1934..... The very next day, the 27th of April 1940 Bhagwan Das filed an application for revival of the suit, No. 9 of 1934. This was opposed on behalf of Ali Yakin, but the application was granted on 9-11-1940, and the suit was revived on that date.
The very next day, the 27th of April 1940 Bhagwan Das filed an application for revival of the suit, No. 9 of 1934. This was opposed on behalf of Ali Yakin, but the application was granted on 9-11-1940, and the suit was revived on that date. The defendant, Ali Yakin, filed a written statement and took the following pleas: (1) that the plaintiff had no cause of action against him, (2) that the defendant had no knowledge of any such hypothecation bond having been executed by Syed Ali Tamkin and even if there was such a bond it was not executed and completed as a hypothecation bond, (3) that the claim was barred by time, (4) that Bhagwan Das, plaintiff, had under a deed of gift transferred the mortgagee rights to his son, Gopi Saran, and that he had, therefore, no right to file a suit, and (5) that Syed Ali Tamkin had no right to hypothecate the property given in the plaint as the said property was a perpetual 'muafi' under the Pensions Act and that it was not, therefore, transferable or saleable. Though Ali Yakin had in his written statement raised as many as five points, the learned Civil Judge framed only two issues, the first issue being, whether the plaintiff has a right to sue, and the second, what rate of interest should be allowed to the plaintiff under the new Act, 13 [XIII] of 1940. 2. On the second point, the learned Judge held in favour of the defendant and gave, him the benefit of the Debt Redemption Act. As the plaintiff has filed no cross-objection, that point is, therefore, set at rest by the decision of the learned Civil Judge. The other issue, whether the plaintiff has a right to sue was decided by the learned Civil Judge in favour of the plaintiff as he held that the deed of gift was a fictitious transaction which had not been acted upon and which had not been accepted by Gopi Saran. That finding is challenged in appeal. 3. On 10-9-1928, Bhagwan Das executed a deed of gift. One of his sons, Mutsaddi Lal, had died leaving a minor son named Anand Kunwar. He purported to give certain bonds in favour of this minor, Anand Kunwar, under the guardianship of his mother, Mt. Basanti Devi.
That finding is challenged in appeal. 3. On 10-9-1928, Bhagwan Das executed a deed of gift. One of his sons, Mutsaddi Lal, had died leaving a minor son named Anand Kunwar. He purported to give certain bonds in favour of this minor, Anand Kunwar, under the guardianship of his mother, Mt. Basanti Devi. He had three surviving sons of whom Babu Ram was an adult and Prakash Chandra and Gopi Saran, were minors. By the deed he purported to give the bond in suit to Gopi Saran, minor, under the guardianship of Gopi Saran's mother, Mt. Jwala Dei. He gave certain other documents to Babu Ram and he purported to give a few others to the other minor son, Prakash Chandra. One of the documents given to Babu Ram was another mortgage deed executed by Ali Tamkin on the 10-6-1922, for a sum of Rs. 600/- only. Bhagwan Das's case now about this deed of gift is that it was a fictitious document and was never intended to be given effect to and that the deeds of gift and the various bonds which he purported to give remained all along in his possession and the domes never accepted them. This case of his has been accepted by the Court below though it has been strongly challenged by learned counsel in appeal. 4. Though this deed of gift was executed on 10-9-1928, we find that Bhagwan Das filed a suit No. 7 of 1933, on 29-5-1933, on a mortgage of 1-6-1921, for RS. 4200 executed by Najmul Hasan and Badrul Hasan, defendants 1 and 2. In this case Bhagwan Das impleaded his sons and grandsons and alleged in para. 3 of the plaint that they bad no right, title and interest in the mortgage and were impleaded as pro forma defendants merely as a precautionary measure. The suit was decreed in favour of Bhagwan Das. He filed another suit as well, NO. 8 of 1933, against certain other mortgagees. In Para. 4 he alleged that the deed of gift was fictitious and that his son, Prakash Chandra, who was impleaded as defendant No. 6 was being impleaded as a pro forma defendant and he had no interest in the deed. This suit too was decreed. The respondents have got printed a statement of Prakash Chandra admitting para.
In Para. 4 he alleged that the deed of gift was fictitious and that his son, Prakash Chandra, who was impleaded as defendant No. 6 was being impleaded as a pro forma defendant and he had no interest in the deed. This suit too was decreed. The respondents have got printed a statement of Prakash Chandra admitting para. 4 of the plaint, but learned counsel for the appellant has urged that this is not admissible in evidence. The document itself is not exhibited and we can find nothing on the record to show that it was ever proved. After having filed those two suits which were decreed in his favour, Bhagwan Das filed the present suit out of which this appeal has arisen on 29-5-1934, claiming to be entitled to the mortgage money, but in this suit he did not impaled Gopi Saran, minor. 5. During the pendency of this suit, however a suit was filed by Mt. Prem Dei widow of Babu Ram, claiming to be entitled to the money due on the other mortgage dated 10-6-1922, for Rs. 600 executed by Syed Ali Tamkin (Suit No. 310 of 1934), To this suit she impleaded Bhagwan Das and Gopi Saran and she claimed that she was entitled to the money. During the pendency of the suit, Mt. Prem Dei applied for a succession certificate and that application was opposed by Bhagwan Das on 29-9-1934. He alleged that the gift deed was fictitious and was never intended to transfer property to his minor sons, nor had it ever been acted upon. On the date of hearing, however, he did not appear and an ex parte order issuing a succession certificate in favour of Mst. Prem Dei was passed by the learned Munsif of Nagina on the 9-3-1335. Bhagwan Das has now given an explanation that the lady was entitled to maintenance and as the amount was only Rs. 600 he gave it to her by way of maintenance and did not, therefore, raise any further dispute. 6. We have the conduct of the parties in connection with the previous suits and the evidence of Bhagwan Das and of Gopi Saran and a few other circumstances pointed out by learned counsel for the respondents on the basis of which to consider whether the deed of gift dated 10-9-1928, was or was not a genuine document intended to be acted upon.
Learned counsel for the respondents has pointed out that the original deed of gift was with the donor and he has produced the same. He has further urged that there was no overt act which would go to show that the deed of gift had ever been acted upon or that the debtors had ever been informed that the debts had been transferred to other persons to whom the amounts were to be paid. The original mortgage deeds on which the two suits were filed in the year 1933 and this suit in 1934 were in the possession of the plaintiff who filed the same. Besides the fact that there is this deed of gift and the fact that Mt. Prem Dei brought a suit relying on this gift and obtained a succession certificate, there is nothing else in favour of the defendant. It is impossible in these circumstances to hold that the judgment of the lower Court on this point is wrong. It is a very, common attempt made by assesses, who want to pay income tax at a lower rate or to avoid payment of income tax, to divide the property among the various members of the family. Gopi Saran has appeared as a witness in the case and has deposed that he had no interest in the mortgage. To the same effect is the statement of Bhagwan Das himself. It is not a case where for the purpose of this suit the father and the son may be said to have colluded to set up a false case. As early as 1933, Bhagwan Das had alleged that the deed of gift was fictitious and that position had been accepted by his sons and by his debtors. We, therefore, feel satisfied that the finding of the learned Judge, that the deed of gift was fictitious and was not acted upon is correct. On that finding, no question of its acceptance by the done arises. 7. Learned counsel for the appellant has taken as many as twelve grounds of appeal all of which relate, directly or indirectly, to the question whether the deed of gift was a genuine document and whether the plaintiff Bhagwan Das could, after the execution of the deed, bring a suit for realization of the money due on the mortgage.
7. Learned counsel for the appellant has taken as many as twelve grounds of appeal all of which relate, directly or indirectly, to the question whether the deed of gift was a genuine document and whether the plaintiff Bhagwan Das could, after the execution of the deed, bring a suit for realization of the money due on the mortgage. Besides the twelve grounds raised in the grounds of appeal, learned counsel for the appellant wished to raise three other grounds by an application dated 9-4-1946. Those grounds are as follows: 13. Because the suit is barred by limitation. 14. Because the order of revival in suit No. 9 of 1934 was without jurisdiction and illegal. 15. Because the learned Civil Judge failed to strike proper issues arising out of the suit. 8. Learned counsel for the appellant has admitted before us that grounds Nos. 13 and 14 may be treated as one and the same, his contention being that the learned Civil Judge had no jurisdiction to revive the suit after the expiry of the period of limitation. We feel most reluctant to allow learned counsel to raise this plea. It is true that a plea of limitation was taken by the defendant in the written statement. He, however, did not press for an issue and we have, therefore, not had the benefit of a judgment on the point by the learned Civil Judge. If we were not satisfied that the suit could in no case be barred by limitation, we would have found it necessary to frame an issue and remit it to the Court below for proper decision: this suit was filed, as we have said, on 29-5-1934. The last payment made on behalf of the mortgagor, of interest as such was on 24-1-1926. It is not clear from the endorsement dated 5-11-1926 whether the last payment was towards interest or was a payment on account. In any case after the payment dated 24-1-1926 of Rs. 100 on account of interest the limitation for filing, the suit was extended to 5-11-1938. (24-1-1938?) The present suit was filed well within limitation on 29-5-1934. It is true that Sayed Ali Yakin was a minor and no guardian was appointed of the minor and he was not shown as a minor in the array of parties in the plaint.
100 on account of interest the limitation for filing, the suit was extended to 5-11-1938. (24-1-1938?) The present suit was filed well within limitation on 29-5-1934. It is true that Sayed Ali Yakin was a minor and no guardian was appointed of the minor and he was not shown as a minor in the array of parties in the plaint. The result, was that all proceedings taken against him so long as he was a minor, after the filing of the plaint, were not binding on Ali Yakin. The decree passed against him was a nullity and it could not be said that the suit had been disposed of as against Syed Ali Yakin. He attained majority on 26-8-1936 about two years prior to the expiry of the period of limitation and on the revival of the suit on the suit on 9-11-1940, it must be held that the suit remained pending all the time and therefore Syed Ali Yakin was properly impleaded as a party after 26-8-1936. No question of limitation can, therefore, arise under the circumstances. 9. Learned counsel for the appellant has relied on a number of rulings of this Court and a decision of their Lordships of Judicial Committee. The first was the case in ('09) 31 All 572 : 36 IA 168 : 3 IC 864 (P.C.), Rashid-Unnisa v. Muhammad Ismail Khan. In that case a proper guardian was not appointed of a minor and a decree was obtained against him and the property was sold. After the sale he filed a suit for a declaration that the decree and the execution sale and all the proceedings in the suit were invalid and were not binding on him as he was, not properly represented. The question arose in that case whether a separate suit would lie by reason of section 244 of the Civil Procedure Code, now section 47 of the Code (Act V of 1908), and their Lordships of the Judicial Committee held that the minor had a right to file a suit as he was not properly represented in the suit and that the decree and other proceedings as against him must be held to be nullities and it could not be said that the minor was a party to the same. The same view was followed in Daulat Singh Vs. Maharaj Raja Ramji, AIR 1926 All 387 and in Dwarika Halwai Vs.
The same view was followed in Daulat Singh Vs. Maharaj Raja Ramji, AIR 1926 All 387 and in Dwarika Halwai Vs. Sitla Prasad and Others, AIR 1940 All 256 There can be no doubt that a minor is not bound by any proceedings taken as against him where he is not properly represented and a guardian is not appointed of such a minor, but the question for decision in this case is not whether the minor was or was not property represented-as it has always been held that he was not-but the question is whether it should be held that there was no suit filed against him on 29-5-4934, because no guardian had been appointed of the minor. In every suit where the defendant is a minor the right of appointing his guardian is not given to the plaintiff but to the Court. The plaintiff can only suggest who should be appointed his guardian and it is for the Court on being satisfied of the fact of the defendant's minority, to appoint a proper person to be guardian for the suit for such minor (O. 32, R. 3, C.P.C.) It is, therefore, obvious that the question of appointment of a guardian must come after the institution of the suit, but when a guardian is appointed the suit is not deemed to have been instituted against the minor on the date of such appointment but on the date when the suit was filed. If, before such appointment is or can be made, the minor attains majority, the suit would not be deemed to be filed against him on the date when he attained majority but on the original day when it was filed in Court. Even if we were to hold that it should be deemed to have been filed on the day when the defendant attained majority in the present case the suit must be deemed to have been filed within time as the defendant attained majority on 26-8-1936. In Talib Ali Shah Vs. Piarey Lal and Another a miner was impleaded as a major and no guardian was appointed. An ex parte decree was obtained against him and later the decree was put in execution. It was in the executing Court that an objection was filed that the defendant had all along been a minor and had not been properly represented and the decree was, therefore, & nullity.
An ex parte decree was obtained against him and later the decree was put in execution. It was in the executing Court that an objection was filed that the defendant had all along been a minor and had not been properly represented and the decree was, therefore, & nullity. This objection was allowed by the executing Court and then the plaintiff filed an application for the restoration of the suit to its original number and for its being proceeded with after the appointment of a guardian ad liter of Talib Ali Shah. The Court acceded to this request and the suit was tried on the merits. On an appeal being filed to this Court on behalf of the minor it was held that the minor must be deemed to have been a defendant to the suit from the very begging, the only defect being that no proper guardian was appointed for him, and that the date of institution was the date when the suit was filed and not the date when the guardian ad litem was appointed. We respectfully agree with this decision and must hold that the suit must be deemed to have been filed on 29-5-1934, as against Syed Ali Yakin though all subsequent proceedings against him were null and void as no proper guardian had been appointed. 10. The reason why we are most reluctant to allowing the appellant to raise this plea of limitation at this stage when he did not insist on an issue on the point in the trial Court and made no grievance of it in his grounds of appeal is because we find that there were certain proceedings taken by some of the defendants under the Encumbered Estates Act. It appears that some of the legal representatives of Ali Tamkin filed an application or applications under the Encumbered Estates Act which remained pending for several years, and in an application dated 5-4-1941, (paper No. 94-C) the information is given to the Court that the Special Judge, II Grade, had dismissed the application under the Encumbered Estates Act. Daring the pendency of the proceedings under the Encumbered Estates Act, by reason of section 7 of that Act no fresh suit could be filed and any suit filed had to remain stayed.
Daring the pendency of the proceedings under the Encumbered Estates Act, by reason of section 7 of that Act no fresh suit could be filed and any suit filed had to remain stayed. All that period has, therefore, to be excluded under S. 43, Encumbered Estates Act, in considering the period of limitation available for the suit. 11. The only other point urged on behalf of the learned counsel for the appellant is that the mortgage deed is not proved according to law. This is aground which was not taken in the grounds of appeal or even in the application dated 9-4-1946. Learned counsel has, however, urged with great force that unless we are satisfied that the mortgage deed was proved according to law we ought not to give the plaintiff a decree on the basis thereof. As we have already said, the Court below had framed only two issues and there was no issue as regards the execution or consideration of the mortgage-deed, though the learned Judge has, in dealing with issue NO. 1 said as follows: The execution of the mortgage bond in suit was duly proved by Sheo Nath Singh attesting witness and passing of consideration is proved by Bhagwan Das as also from the documents, Exhibits I and II. 12. We must say that this case was tried in a very perfunctory manner by the learned Civil Judge. We looked at the back of the original mortgage deed and we could not find any admission or denial on behalf of the appellant, Ali Yakin. It is true that the suit had once been decreed ex parte and the other legal heirs of Ali Tamkin had submitted to the decree, but yet as against Ali Yakin the suit had to be tried according to law. In the written statement, the defendant had no doubt taken a plea which, though not very clearly worded, may be taken to be a specific denial of the execution of the mortgage deed. It is true that it does not appear that the defendant ever pressed for an issue on the point. He did not make a grievance of this fact even in the grounds of appeal filed by him in this Court, though he had taken as many as twelve grounds of appeal.
It is true that it does not appear that the defendant ever pressed for an issue on the point. He did not make a grievance of this fact even in the grounds of appeal filed by him in this Court, though he had taken as many as twelve grounds of appeal. Three years after the filing of the appeal when the case was actually listed for hearing learned counsel for the appellant filed an application already mentioned by us above on 9-4-1946, and even in this application no such ground was taken. 18. On the evidence on the record, however, it is urged by learned counsel for the respondent that even if it was necessary to prove the mortgage deed, the mortgage deed was proved according to law. That Bhagwan Das plaintiff went into the witness-box and stated that Ali Tamkin had borrowed Rs. 5000 from him and had executed and signed the mortgage bond which was Ex. 1 in suit. It does not appear, however, from the Judge's notes of the evidence of Sheo Nath, attesting witness, whether his attention was at all drawn to the mortgage deed. We have new a single record system which means that the Judge takes short notes of the evidence in English while the witness is giving his evidence in the vernacular. The notes of evidence recorded by the learned Judge are neither as full nor as complete as we would expect them to be. The fact, however, remains that there was neither any clear issue on the point nor was there any ground of appeal clearly taken in this Court. 14. Learned counsel for the respondents has relied on the case in ('12) 12 A.L.J. 1114 : 1 AIR 1914 All. 306 : 26 I.C. 84, Chiranji Lal v. Poorna and has urged that there was sufficient compliance with the requirements of S. 68. Evidence Act. It is not necessary for us at this stage to go into this question as we feel that it would be proper if a clear issue is framed on the point and the lower Court is asked to record a finding on the same.
Evidence Act. It is not necessary for us at this stage to go into this question as we feel that it would be proper if a clear issue is framed on the point and the lower Court is asked to record a finding on the same. Before, however we finally dispose of this case, we direct that the lower Court may remit a finding to this Court on the issue whether the mortgage deed in suit was executed by Ali Tamkin and was duly attested by the attesting witnesses. The parties would be entitled to produce fresh evidence. The finding is to be remitted within three months from this date and ten days time will be allowed to the parties to file objections on receipt of the finding. [On receipt of the finding, their Lordships held that the mortgage-deed in suit was proved according to law. They, therefore, dismissed the appeal with costs.] UP470152 Mulla, Malik and Mootham JJ. Bal Krishna Maheshwari Uma Shanker Mehrotra and another Civil Revn. No. 278 05.03.1947 Sir Tej Bahadur Sapru, P.L. Banerji, Mushtaq Ahmed, Sambhu Prasad, S.N. Katju and Jalaluddin Ahmad Sir Alladi Krishnaswami Aiyar, G.S. Pathak, B.N. Gurtu, P.N. Hahsar, R.K. Khanna and A. Hoon 1. This is reference to a Full Bench which arises out of a petition in revision under s. 115, Civil P.C., presented by one Bal Krishna Maheshwari, a member of the Merchants' Chamber of U.P. which is a Company limited by guarantee duly incorporated and registered under S. 26, Companies Act (7 [VII] of 1913). The petitioner challenged the validity of an order passed by the learned District Judge of Cawnpore on 26-4-1946, confirming a previous ex parte order passed by him on 28-3-1946, directing the calling of the annual general meeting of the Company on 27-4-1946. The challenge was made on the ground that the said order of the learned District Judge of Cawnpore was beyond his jurisdiction and on that basis the petitioner claimed the relief that the said order and the annual general meeting of the Company held in pursuance thereof should be declared to be null and void. The matter came up for consideration before a Bench of this Court and from the argument addressed by the parties two questions haying an important bearing on the administration of the Company law arose for determination.
The matter came up for consideration before a Bench of this Court and from the argument addressed by the parties two questions haying an important bearing on the administration of the Company law arose for determination. In view of the importance of those questions, and the fact that they were not covered by any precedent of this Court or of any other High Court the Bench seized of the matter made the present reference with the object of having those questions fully considered and finally decided by an authoritative pronouncement of this Court. 2. The material facts of the case and the points raised in the course of the argument have been set out at great length in the order of reference made by the Bench and we think it would be an obvious waste of time and labour to cover the whole ground again in the present judgment. As already stated, there are but two points of law which arise for consideration and we consider it necessary to state a few facts in order to bring out those points. Article 46 of the Articles of Association of the Company provides that an annual general meeting of the Company shall be held in every calendar year before the 31st of March. The dispute in the present case relates to the annual general meeting of the Company for the year 1946. It is an admitted fact that the last preceding annual general meeting of the Company had taken place on 3-2-1945. According to the Article of Association of the company referred to above, the annual general meeting of the Company for the year 1946 had to be called on some date before 31st March in that year. The management of the affairs of the Company lies in the hands of a Council of twenty one members, including a President and a Vice President, and the duty of calling the annual general meeting of the Company in every calendar year falls upon that Council. On behalf of the petitioner it is alleged that in accordance with the Articles of Association of the Company a clear fourteen days' notice for the annual general meeting in 1946 was issued and posted in due course on 13-3-1946, fixing 28-3-1946, as the date of the meeting.
On behalf of the petitioner it is alleged that in accordance with the Articles of Association of the Company a clear fourteen days' notice for the annual general meeting in 1946 was issued and posted in due course on 13-3-1946, fixing 28-3-1946, as the date of the meeting. It is contended on the other side that though a notice was directed to be issued fixing that date, yet, in fact no notice was issued and posted to any member of the Company until 15-3-1946, so that there could be no clear fourteen days' notice of the meeting as required by Art. 49 of the Company's Articles of Association. It is further alleged that a member of the Company, who received a notice of the meeting to be held on 28-3-1946, actually raised an objection that the notice was invalid and sent a written communication to that effect to the President of the Council who thereupon proceeded to cancel the meeting on 25-3-1946, and on 28th March made an application to the learned District Judge, Cawnpore, invoking his jurisdiction under S. 79 (3), Companies Act to call the annual general meeting. The two points of law which have to be determined in the present case turn upon the true interpretation of S. 79 (3), Companies Act and it is, therefore, necessary to set out its terms in extenso. The section runs as follows: If for any reason it is impracticable to call a meeting of a company in any manner in which meetings of that company may be called or to conduct the meeting of the company in manner prescribed by the articles or this Act, the Court may, either of its own motion or on the application of any director of the company who would be entitled to vote at the meeting, order a meeting of the company to be called, held and conducted in such manner as the Court thinks fit, and where any such order is given may give such ancillary or consequential directions as it thinks expedient, and any meeting called, held and conducted in accordance with any such order shall for all purposes be deemed to be a meeting of the company duly called, held and conducted.
For the purposes of appreciating the points raised before us in the argument on behalf of the petitioner it is necessary also to set out here the terms of s. 76, Companies Act, which runs as follows: 76. (1) A general meeting of every company shall be held within eighteen months from the date of its incorporation and thereafter once at least in every calendar year and not more than fifteen months after the holding of the last preceding general meeting. (2) If default is made in holding a meeting in accordance with the provisions of this section, the company and every director or manager of the company who is knowingly and wilfully a party to the default shall be liable to a fine not exceeding five hundred rupees. (3) If default is made as aforesaid, the Court may, on the application of any member of the company, call or direct the calling of a general meeting of the company. We may also mention here that the learned District Judge has found as a fact upon the evidence produced before him by the parties that though a meeting of some sort was held on 28-3-1946, yet the notice calling a meeting on that date was not actually issued and posted until 15th or 16th March 1946, so that it did not leave a clear margin of fourteen days before 28-3-1946. Having arrived at that finding, the learned District Judge proceeded to hold that the meeting of some sort which had taken place on 28-3-1946, was not a valid meeting in the eye of the law and had consequently to be disregarded altogether. He thus arrived at the conclusion that the calling of a valid meeting in the manner prescribed by the Company's Articles of Association had become impracticable and he consequently proceeded on 26-4-1946, to confirm his previous ex parte order of 28-3-1946, calling a general meeting of the Company on 27-4-1946. The petition before us challenges the validity of this order and consequently of the meeting held in, pursuance thereof on the ground that it was beyond the jurisdiction of the learned District Judge. 3.
The petition before us challenges the validity of this order and consequently of the meeting held in, pursuance thereof on the ground that it was beyond the jurisdiction of the learned District Judge. 3. It is not permissible in revision to go behind the finding of fact recorded by the learned District Judge and the argument before us has, therefore, proceeded on the assumption that though a meeting of some sort was held on 28-3-1946, yet there was no clear fourteen days notice for that meeting as required by the Company's Articles of Association. In view of the clear language of S. 79 (3), it is evident that there is a condition precedent to the exercise of the jurisdiction conferred by it and that is that it must be found that for some reason it has become impracticable to call a meeting of a company in any manner in which meetings of that company may be called. So far there is and can be no contest. On behalf of the petitioner, the challenge against the jurisdiction of the learned District Judge is sought to be supported on two grounds and they give rise to the two points of law which we have to determine. The first ground is that the question of the impracticability or otherwise of calling an annual general meeting must be decided not only in the light of the Company's Articles of Association, but also of the general provision contained in S. 76 (1), which has been cited above. It is contended on that basis that in the circumstances of the present case, the calling of the annual general meeting of the Company had not become impracticable, inasmuch as though the time limit prescribed by the Company's Articles of Association had expired, yet the wider limit laid down by S. 76 (1), was still available and having regard to the fact that the last preceding annual general meeting had taken place on 3-2-1945, the annual general meeting for the year 1946 could validly be called at any time before 3-5-1946. It has been very strenuously argued on behalf of the petitioner that in the present case a conflict had arisen between the general provision contained in S. 76 (1) and the Articles of Association of the Company and the former must prevail over the latter.
It has been very strenuously argued on behalf of the petitioner that in the present case a conflict had arisen between the general provision contained in S. 76 (1) and the Articles of Association of the Company and the former must prevail over the latter. In support of his argument, learned counsel for the petitioner further contended that in S. 79 (3) the phrase "in manner prescribed by the articles or this Act" must be applied to both the clauses that precede it and it must, therefore, be held that the impracticability or otherwise of calling a meeting has to be determined not only by reference to the Articles of Association of a Company, but also to the general provisions of the Act. Upon a careful analysis of the language of s. 79 (3) and of the general provision contained in S. 76, we are unable to accept this contention. In our judgment, there are two distinct and separate clauses which precede -the phrase "in manner prescribed by the articles or this Act" in S. 79 (3) and it follows, therefore, that upon a plain grammatical construction of the language of the section the phrase is applicable only to the clause which immediately precedes it. Section 79 (3) provides for two separate matters firstly, the impracticability of calling a meeting of a company in any manner in which meetings of that Company may be called and secondly, conducting the meeting of the company "in manner prescribed by the articles or this Act." It is worthy of note that the words "in any manner" occur in cl. 1 and upon the reading suggested by the learned counsel for the petitioner the words "in manner" have to be repeated if the phrase "in manner prescribed by the articles or this Act" is applied to both the clauses that precede it. Upon a plain reading of the language of the section, we are of the opinion that the question of the impracticability or otherwise of calling a meeting has to be decided primarily in the light of the company's Articles of Association. We may here point out that the words "that company" in cl. 1, are very significant. They clearly show that the clause refers to a particular company and not to all companies; whereas the provision contained in 9. 76 (1) applies to every company.
We may here point out that the words "that company" in cl. 1, are very significant. They clearly show that the clause refers to a particular company and not to all companies; whereas the provision contained in 9. 76 (1) applies to every company. It has, however, to be borne in mind that there may be cases in which the Articles of Association either fail to make any provision for a matter which is governed by the general provisions of the Act or make a provision which is in direct conflict with some mandatory provision of the Act applicable to all companies. In the former case it would obviously be necessary to refer to the Act when deciding the question of the impracticability or otherwise of calling a meeting. In the latter case, the mandatory provision of the Act will prevail and the provision contained in the Articles of Association will have to be disregarded. Apart from these exceptional cases, the question of the impracticability or otherwise of calling a meeting must be decided only by reference to the company's Articles of Association. We find further that in the circumstances of the case before us no conflict could really arise between the general provision contained in S. 76 and the Company's Articles of Association. Section 76 in sub-s. (1) lays down two mandatory provisions of general application to all companies relating to the calling of the annual general meeting, firstly, that the meeting shall be held once at least in every calendar year and secondly, that it shall be held not more than fifteen months after the holding of the last preceding general meeting. This sub-section does not prohibit any company from prescribing any time limit for the holding of its annual general meeting so long as the two mandatory conditions mentioned above are fulfilled. In the case before us, the Company laid down in Art. 46 of its Articles of Association that there shall be an annual general meeting of the Chamber which shall be held before the 31st of March, at such time and place, as the Council for the time being may determine. This provision did not contravene any one of the two conditions, prescribed by S. 76 (1) and hence no question of any conflict between S. 76 (1), and the Company's Articles of Association arises at all.
This provision did not contravene any one of the two conditions, prescribed by S. 76 (1) and hence no question of any conflict between S. 76 (1), and the Company's Articles of Association arises at all. In prescribing a time limit for the holding of its annual general meeting in each calendar year the Company did not infringe any provision of the Companies Act. It is not one of the exceptional cases referred to above, and it follows, therefore, that the question of the impracticability of calling the annual general meeting in 1946 had to be determined only by reference to the Company's Articles of Association. The argument on behalf of the petitioner proceeds on the assumption that S. 76 enables the calling of an annual general meeting at any time after the expiry of the time limit fixed by a Company's Articles of Association and before the expiry of the wider time limit given by S. 76 (1). Upon a plain reading of the language of S. 76, we find that this assumption is not correct. An annual general meeting of a company may be called under sub-s. (3) of S. 76, on the application of any of its members, but the condition precedent is that a default must have taken place in holding the general meeting in accordance with the provisions of the section. It follows, therefore, that s. 76 can never operate for the purposes of calling an annual general meeting at any time within the limit prescribed by sub-s. (1). From this again it is clear that in the present case there could be no conflict between s. 76 on the one hand and the Company's Articles of Association on the other. Learned counsel for the petitioner contended that if the Directors of the Company had called and held the annual general meeting at any time after 31-3-1946, and before 3-5-1946, the validity of such a meeting could not possibly be challenged in view of S. 76 (1). It may have been possible for the Directors of the Company to call and hold such a meeting and that meeting may have been valid, but it could not be a meeting called and held either in accordance with the Company's Articles of Association or the provisions of S. 76.
It may have been possible for the Directors of the Company to call and hold such a meeting and that meeting may have been valid, but it could not be a meeting called and held either in accordance with the Company's Articles of Association or the provisions of S. 76. The meeting could be called and held with the consent of all the members, but the possibility of such a meeting being called and held cannot be taken into account for the purpose of deciding the question whether the calling of the annual general meeting bad or had not become impracticable on the date on which the jurisdiction of the learned District Judge under S. 79 (3) was invoked. We are, therefore, of the opinion that the general provisions contained in s. 76 of the Act, have no application to the period intervening between the time limit for calling and holding and annual general meeting fixed by a Company's Articles of Association and the wider time limit for calling and holding such a meeting prescribed by S. 76 (1). At any time before the expiry of the wider limit prescribed by S. 76 (1) the jurisdiction conferred upon the Court by S. 79 (3) comes into operation and it can be invoked by a director or a member of any company for calling the annual general meeting. We find further that the jurisdiction of the learned District Judge was rightly invoked in the present case by the President of the Council in charge of the management of the Company's affairs. 4. The second ground on which the jurisdiction of the learned District Judge has been assailed is that S. 79 (3) is only a procedural provision which does not confer any indicial power on the District Judge to enter into and decide the question of the validity or otherwise of a meeting alleged to have been held.
4. The second ground on which the jurisdiction of the learned District Judge has been assailed is that S. 79 (3) is only a procedural provision which does not confer any indicial power on the District Judge to enter into and decide the question of the validity or otherwise of a meeting alleged to have been held. It is contended that where the jurisdiction of the Court is invoked under S. 79 (3) of the Act, for the purpose of calling a meeting and an objection is raised that a meeting has in fact already been called and held, all that lies in the power of the Court to do in the exercise of its jurisdiction is to deckle the question of fact and if it finds that the fact of a meeting having been held has been established, it must immediately stay its hand and has no jurisdiction to proceed further to decide whether the meeting was valid or invalid. It was strenuously argued that as soon as the issue of the validity or otherwise of a meeting is raised, the Court acting under S. 79 (3) of the Act, must declare that it has no jurisdiction to proceed any further and must leave the parties to pursue their remedy in the civil Court. At one stage of the argument, learned counsel for the petitioner tried to maintain that the Court acting under S. 79 (3), ceased to have any jurisdiction as soon as an objection was raised before if that a meeting has actually been held. The claim that the jurisdiction of a Court can be ousted merely by an allegation is obviously extravagant and it was not, therefore, pressed, but the learned counsel laid great emphasis on the fact that an order passed by the Court in the exercise of its jurisdiction under S. 79 (3) of the Act, is not open to any appeal even though the order might affect valuable rights and, on this ground, we were asked to infer that the law could not possibly have intended to confer upon the Court the jurisdiction to determine the validity or otherwise of a meeting. In our judgment, the position taken on behalf of the petitioner is untenable.
In our judgment, the position taken on behalf of the petitioner is untenable. It is conceded that there are no express words in the statute which place the suggested limit on the jurisdiction of the Court under S. 79 (3), but it is contended that the lack of jurisdiction to decide the question of the validity or otherwise of a meeting must necessarily be inferred from the fact that no appeal has been provided from an order made by the Court in the exercise of its jurisdiction under that' section. In dealing with this question, we must first of all point out that all jurisdiction under the Companies Act has been conferred by S. 3 (1), in the first instance upon "the High Court having jurisdiction in the place at which the registered office of the company is situate." We do not think that it can be argued with any force or reason that the High Court has no jurisdiction to enter into and decide the question of the validity or otherwise of a meeting. There is further provision in the same section "that the Central Government may, by notification in the official gazette and subject to such restrictions and conditions as it thinks fit, empower any District Court to exercise all or any of the jurisdiction by this Act, conferred upon the Court, and in that case such District Court shall, as regards the jurisdiction so conferred, be the Court in respect of all companies having their registered offices in the district." The District Judge at Cawnpore exercises jurisdiction under the Companies Act in accordance with this provision and it has not been suggested that the Central Government has placed any restrictions upon his jurisdiction. It follows, therefore, that the District Judge at Cawnpore possesses the same jurisdiction which has been conferred upon the High Court by S. 3 (1) of the Act. Now, when the Court empowered under S. 3 (1) proceeds to exercise the jurisdiction conferred upon it by s. 79 (3), the very first question which it has to decide is whether the calling of a meeting has become impracticable.
Now, when the Court empowered under S. 3 (1) proceeds to exercise the jurisdiction conferred upon it by s. 79 (3), the very first question which it has to decide is whether the calling of a meeting has become impracticable. It is open to any party to challenge the exercise of that jurisdiction and for that purpose it may be alleged as in the present case that a meeting has actually been called and held and hence the basic condition on which the Court can proceed to exercise its jurisdiction for calling a meeting does not exist at all. Such an allegation must necessarily amount to assertion that the meeting alleged to have been held fulfils all the requirements of the law. No objector can be allowed to ask the Court to stay its hand merely with the allegation that a meeting has in fact been called and held, though it was not a valid meeting. When such an allegation is made, the issue which immediately arises for decision is : Has a valid meeting been in fact called and held ? The Court must proceed to find not only whether a meeting of some sort has been held but that the said meeting fulfilled the requirements of the law before it can refuse to exercise its jurisdiction. The Court may find that a meeting of say nine persons was held, though the quorum required by the law was ten and the question is whether upon such a finding the Court must stay its hand and declare that it has no further jurisdiction in the matter. In our judgment, the answer is obviously in the negative. The Court cannot shut its eyes to the fact that the meeting actually held was not a meeting in the eye of the law and if it takes that fact into account, it must proceed to hold that the calling of a meeting has become impracticable provided that the time limit fixed for the calling of such a meeting by the Company's Articles of Association has expired or the calling of the meeting within that time limit in the manner prescribed by the Articles of Association has become impossible.
We see no reason at all why such an issue should not be determined by the Court, There is nothing in the language of S. 79 (3) upon which the contention of the learned counsel for the petitioner can be founded. It was strenuously contended by learned counsel that the determination of such an issue might often involve the decision of complicated questions of fact and law and it must therefore, be inferred that the law did not contemplate the determination of such a question in a miscellaneous proceeding under S. 79 (3). We are not impressed at all by this argument because we do not think that in the large majority of cases any complicated questions of law and fact will arise for consideration. 5. The question of the validity or otherwise of a meeting will, in a vast majority of cases, turn upon the interpretation of the Company's Articles of Association and some general provisions of the law. We see no reason for holding that the Court acting under S. 79 (3) is for any reason less competent to try and decide such questions than the civil Court to which learned counsel for the petitioner seems to attach a peculiar sanctity. It has to be borne in mind that the District Court empowered under s. 3 (1), Companies Act, possesses unlimited jurisdiction for trying civil suits when acting as a civil Court and we see no justification in law for placing any fetters upon it when acting in the exercise of its jurisdiction under S. 79 (3). Nor are we impressed by the argument that the law could not have intended to afford such a wide jurisdiction upon the Court acting under S.79 (3) because it did not provide for any appeal from an order passed in the exercise of that jurisdiction and also because it is always open to a party to move the civil Court for the determination of the validity or otherwise of a meeting. These considerations do not, in our judgment, justify the contention that the jurisdiction of the Court under S. 79 (3) must be of a very limited character.
These considerations do not, in our judgment, justify the contention that the jurisdiction of the Court under S. 79 (3) must be of a very limited character. We may also point out that it may be said on the other hand, and perhaps with greater reason, that the law might well have presumed that the members of a company would be anxious to prevent the normal running of then: business from being brought to a stand still by protracted litigation in the civil Court and to have any disputes calculated to interfere with that business speedily settled by resorting to the Court upon which jurisdiction has especially been conferred under the Companies Act, It may be open to any party to seek relief from the civil Court, but that is no reason for holding that the jurisdiction of the Court especially empowered to deal with company matters is in any respect fettered or limited. We, therefore, hold that where upon the jurisdiction of the Court under S. 79 (3) being invoked by a party a question is raised as to the validity or otherwise of a meeting, the Court has jurisdiction to determine that question. It follows, therefore, that the order passed by the learned District Judge at Cawnpore on 26-4-1946, confirming the previous ex parte order passed by him on 28-3-1946, in pursuance of which the annual general meeting of the company was called and held on 27-4-1946, was entirely within his jurisdiction and the petitioner is not entitled to any relief. The petition in revision is accordingly dismissed with costs.