DIPAK KUMAR SEN, J. ( 1 ) - Sandhyasree Saha and Manjushree Saha the plaintiffs, instituted the above Suit on or about the 15th May 1984 with leave under Clause 12 of the Letters Patent and also Order 1, Rule 8 of the Code of Civil Procedure against Ambari Tea Company Limited, Krishnagopal Kundu Saha, Naresh Acharya Bhadhuri, Nandadulal Saha, Juthika Saha, Himangshu Dutta, Ruprakash Saha, Santosh Saha and Shamananda Saha impleaded respectively as the defendants Nos. 1 to 9 claiming, inter alia a declaration that the notices, dated April 23, 1984 convening the 74th, 75th and 76th Annual General Meeting of the Ambari Tea Company Ltd. , the defendant No. 1, on May 19, 1984 are illegal, void and inoperative; a perpetual injunction restraining the defendants Nos. 2 to 8 from holding the said Annual General Meetings of the defendant No. 1 in pursuance of the said notices on May 10, 1984 or on any other date or passing any resolution thereat; a declaration that the defendants Nos. 2 to 8 and each one of them have ceased to be the directors of the defendant No. 1 and cannot act as such; an injunction restraining the defendants No. 2 to 8 from holding out or acting as directors of the defendant No. 1; the Board of Directors of the defendant No. 1 be superseded and a Receiver or Special Officer or Administrator be appointed to conduct the management and affairs of the defendant No. 1 vested with the full powers of the Board of Directors of the defendant No. 1. ( 2 ) THE case of the plaintiffs in the plaint is, inter alia, that- (A) The defendant No. 1 is an existing limited company within the meaning of the Companies Act, 1956 and owns and runs a tea garden known as Ambari Tea Estate in the District of Jalpaiguri of West Bengal. (b) The plaintiffs are share-holders of the defendant No. 1. (c) Article 102 of the Articles of the defendant No. 1 is as follows; "at each Annual General Meeting of the company one third of such of the Directors for the time being as are liable to retire by rotation if their number is not three or a multiple of three then the number nearest to one-third shall retire from office. An additional Director appointed by the Board under Article 91 hereof shall not be liable to retire by rotation within the meaning of this Article. " (d) The last Annual General Meeting of the defendant No. 1, viz. , the 73rd Annual General Meeting was held on the 30th September 1980 where the Balance-sheet and the Profit and Loss Account of the defendant No. 1 for the year ended the 31st December 1979 were accepted and adopted. (e) (i) The defendant No. 2 was re-elected as a Director of the defendant No. 1 at the Annual General Meeting of the latter held on the 27th June 1979. (ii) The defendant No. 3 was appointed as a Director of the defendant No. 1 in March 1984 against the vacancy caused by the resignation of one Director on the 17th March 1984. The latter had been elected as a Director on the 30th September 1980 at the last Annual General Meeting of the defendant No. 1. (iii) The defendant No. 4 was co-opted as a Director on the 25th February 1981 in place of another Director who was reelected as a Director of the defendant No. 1 at the last Annual General Meeting of the company held on 30th September 1980. (iv) The defendant No. 5 was appointed as a Director of the defendant No. 1 on the 25th February 1981 in place of Ramananda Saha her husband, who was re-elected as a Director at the Annual General Meeting of the defendant No. 1 held on the 27th June 1979. (v) The defendant No. 6 was appointed as a Director of the defendant No. 1 on or about the 9th February 1984 against the vacancy caused by the resignation of the defendant No. 4 who was re-elected as a director at the Annual General Meeting of the defendant No. 1 held on the 30th August 1978. (vi) The defendant No. 7 was re-elected as a Director at an Annual General Meeting on the 30th August 1978. (vii) The defendant No. 8 was re-elected at the Annual General Meeting of the defendant No 1 held on the 27th June 1979. (f) The defendants Nos. 2 to 8 are presently claiming to be and acting as the directors of the defendant No. 1. The defendant No. 1 is claiming to be the chief executive of the defendant No. 1. (f) The defendants Nos. 2 to 8 are presently claiming to be and acting as the directors of the defendant No. 1. The defendant No. 1 is claiming to be the chief executive of the defendant No. 1. (g) As on Annual General Meeting of the defendant No. 1 has been held after the 30th September 1980 the defendant Nos. 2 to 8 and each of them would be considered to have vacated their office as Directors of the defendant No. 1 between September 1981 and September 1983. On and from September 1983 by operation of the mandatory provisions of the Companies Act there are no lawful Directors of the defendant No. 1. (h) The Annual General Meeting of the defendant No. 1 to consider the accounts for the year ended 31st December 1980 ought to have been convened and held within the 30th September 1981. Taking into account the extension of three months which in law could be granted by the Registrar of Companies, at the maximum. The Board of Directors of the defendant No. 1 had no power to convene or hold an Annual General Meeting to consider the accounts of the defendant No. 1 for the year ending the 31st December 1980 or to transact other business to be considered at such a meeting after the 30th September 1981. (i) After the 30th September 1981 only the Central Government was empowered to convene an Annual General Meeting of the company under Section 167 of the Companies Act, 1956. (j) No Annual General Meeting of the defendant No. 1 has been convened or held in 1982 and 1983. (k) Three notices all, dated the 23rd April 1984, have been issued in the name of the defendant No. 1 purporting to call the 74th, 75th and 76th Annual General Meeting of the company for the years ending of the 31st December of 1980, 1981, 1982, to be held on the 19th May 1984. (1) Along with the notice a statement of account of the defendant No. 1 as at the 31st December 1980 for the 74th Annual General Meeting, an auditor's report, dated the 19th April 1984, the Director's report, dated the 23rd April 1984 and an explanatory Statement in respect of the special business sought to be transacted in the said meeting have been annexed. (m) In the notices for the 75th and 76th Annual General Meeting's no accounts, Directors' report or Auditors' report for the corresponding period have been annexed. (n) The said notices, dated the 23rd April 1984, are all illegal, void and ultra vires the Companies Act on the following grounds: (i) The notices have been signed by the defendants Nos. 5 and 8 as directors. The said defendants are not lawful or valid Directors of the defendant No. 1 and have no authority by themselves or from the Board of Directors, which is non-existent, to call such meetings. (ii) The explanatory statements annexed to the said notices are tricky and misleading and do not disclose material facts. (iii) In the notices convening the 75th and 76th Annual. General Meeting it is stated in the agenda that consideration and adoption of Balance-sheet and Profit and Loss Account with the auditors report will be adjourned as also the agenda regarding the re-appointment of auditors. The said item in the agenda is exfacie, mala fide, oppressive and against the interest of the share-holders of the company and is intended only to allow the pretended Directors to re-appoint themselves. (o) The defendants Nos. 2 to 8 with their supporters and followers are trying to corner the shares of the defendant No. 1. On the ground that share certificates have been lost in respect of small holdings by different persons advertisements are being published for issue of duplicate share certificates in place of alleged lost certificates. Thereafter, with the aid of the duplicate certificates, transfer of shares are being effected in favour of the defendants Nos. 2 to 8 and their group. (p) The defendants Nos. 2 to 8 at the same time are refusing registration of transfers received by the defendant No. 1 in the names of persons not in the group of the said defendants. A number of applications has been made in this Court under Section 155 of the Companies Act, 1956. Appeals have also been filed before the Company Law Board under Section 111 of the Companies Act. (q) The defendants Nos. 2 to 8 have no right to act or hold themselves out as directors of the defendant No. 1 but they are acting as such directors and are misappropriating the funds and assets of the defendant No. 1. Appeals have also been filed before the Company Law Board under Section 111 of the Companies Act. (q) The defendants Nos. 2 to 8 have no right to act or hold themselves out as directors of the defendant No. 1 but they are acting as such directors and are misappropriating the funds and assets of the defendant No. 1. Tea produced by the defendant No. 1 are being sold at gross undervalue. ( 3 ) ON a notice taken out sometime in May 1984 the plaintiffs made an application in the suit for the following orders: (A)an injunction restraining the defendants Nos. 2 to 8 from acting as members of the Board of Directors and the defendant No. 9 from acting as the Chief Executive of the defendant No. 1; (b)an injunction restraining the defendants Nos. 2 to 9 from dealing with of disposing of or encumbering the assets of the defendant No. 1 in any manner; (c)an injunction restraining the defendants Nos. 2 to 9 from operating the banking accounts of the defendant No. 1 or dealing with the money or funds of the latter. (d)an injunction restraining the defendant Nos. 2 to 9 from holding the Annual General Meetings of the defendant No. 1 scheduled on May 19, 1984 or any other date and to transact any business in the said meetings pursuant to the notices, dated the 23rd April; (e)an Administrator or Receiver or Special Officer be appointed over the defendant No. 1 to take possession and charge of all the assets, properties and books of accounts of the defendant No. 1 including the statutory books and to manage the defendant No. 1. ( 4 ) IN the petition the plaintiffs alleged further that the defendants Nos. 2 to 9 have manipulated or tampered with or secreted the books and records of the defendant No. 1 and they would also try to destroy evidence of such wrongful acts. It is further alleged that the affaire of the defendant No. 1 are no longer safe under the management of the defendants Nos. 2 to 9. ( 5 ) THE said application was opposed by the defendants. Suprakash Saha, the defendant No. 7, affirmed an affidavit on the 12th June 1984 which was filed in opposition to the petition. It is further alleged that the affaire of the defendant No. 1 are no longer safe under the management of the defendants Nos. 2 to 9. ( 5 ) THE said application was opposed by the defendants. Suprakash Saha, the defendant No. 7, affirmed an affidavit on the 12th June 1984 which was filed in opposition to the petition. The case of the defendants in the said affidavit appears to be as follows: (A) The mutation on the alleged transfer of the share of the defendant No. 1 has been rightly refused by the Board of Directors. There were four applications under Section 155 of the Companies Act, 1956 which were pending in respect of 990 shares. Apart from the said application a suit being Suit No. 186 of 1984 was pending in this Court (intituled Parbati Charan Saha vs. Ambari Tea Company Limited ). The present plaintiffs are also the plaintiffs in the said suit. In the said suit three of the plaintiffs have claimed mutation of their names in respect of 1665 shares of the defendant No. 1. The said suit was also pending. (b) It is denied that there was no valid Board of Directors of the defendant No. 1 as alleged. It is alleged that the Annual General Meetings for the years ending in December 1981 and 1982 were duly called by the Board of Directors. (c) It is contended that the defendant No. 1 has a right to call an Annual General Meeting of the company even after the period fixed under Section 166 of the Companies Act. (d) Notices of the said Annual General Meetings addressed to the plaintiffs were duly posted under certificate of posting on the 24th April 1984. (e) It is alleged that accounts for the year ending on the 31st December 1981 and the 31st December 1982 could not be sent along with the notices of the 75th and the 76th Annual General Meetings of the defendant No. 1 as the same were not ready and. as such it was an item in the agenda that the passing of the said accounts would be adjourned. Unless auditors were appointed in the 74th Annual General Meeting to audit the accounts and submit their report, the audited accounts for the next year could not be made ready or completed. as such it was an item in the agenda that the passing of the said accounts would be adjourned. Unless auditors were appointed in the 74th Annual General Meeting to audit the accounts and submit their report, the audited accounts for the next year could not be made ready or completed. Similarly, unless auditors were appointed at the 75th Annual General Meeting the 76th Annual General Meeting could not be held effectively and the accounts passed. It was necessary to hold the 74th Annual General Meeting for the year ending the 31st December 1981 to finalise the accounts of the said year so that the subsequent accounts could be made ready. (f) The plaintiffs and their supporters constituted a minority in the defendant No. 1, as admitted by the plaintiffs in the said suit No. 156 of 1984. (g) The defendant No. 1 was obliged to publish an advertisement whenever there was a complaint by any share-holder that share scripts had been lost. Publication of such advertisement was required under the articles of the defendant No. 1 before any duplicate share could be issued. (h) The defendant No. 1 had refused registration whenever it was found that the transfer deed was not in accordance with the statutory provisions. Such refusal had been validly made and under the articles of the defendant No. 1. The defendant No. 1 was not required to give reasons for the refusal. (i) It is denied that there has been any misappropriation of the funds or the estate of the defendant No. 1 or that any tea has been sold at gross under value. Some tea produced by the defendant No. 1 were off grade and therefore, were sold at a lower price. In general, teas are sold in auction under direct supervision of the Bankers of the defendant No. 1. (j) A Special Officer had been appointed in the earlier suit namely Suit No. 186 of 1984 for the purpose of making inventory of books, papers and documents of the defendant No. 1 and such inventory has already been made. (k) It is alleged that the accumulated loss of the defendant No. 1 upto 1982 being about Rs. 70 lakhs has already been recouped in substance during the financial year 1983 and it is expected that the entire loss would be recouped by 1984 and the dividends would be declared in 1984. (k) It is alleged that the accumulated loss of the defendant No. 1 upto 1982 being about Rs. 70 lakhs has already been recouped in substance during the financial year 1983 and it is expected that the entire loss would be recouped by 1984 and the dividends would be declared in 1984. ( 6 ) THE plaintiff No. 1 affirmed an affidavit sometime in June l984 which was filed in reply to the aforesaid affidavit of the defendant No. 7. In the said affidavit the allegations in the plaint and petition were reiterated and it was contended further as follows: (A) If accounts could not be placed in an Annual General Meeting the main object of calling such a meeting would be frustrated. Further, if accounts could not be prepared for any reason there was no justification for not holding the Annual General Meeting within the stipulated tinge. (b) In any event the annual account for the year ended 31st December 1982 could not be validly certified or adopted in view of the qualified certificate given by the auditors. (c) For publishing the advertisement in respect of loss of share scrips, costs were not recouped by the defendant No. 1 nor any Indemnity taken from the share-holders who reported such loss of share scrips. The applications for issue of duplicate shares on the ground of loss of original share were not placed at any meeting of the Board of directors. (d) It is alleged that the sale of the so-called off grade tea was not made through the public auction nor through the bankers of the defendant No. 1. It is alleged that the certificate obtained from the Chartered Bank was a procured one. No quotation was disclosed by the defendant No. l from any recognised tea purchaser to show what was the price of the said quality of tea. The bankers of the defendant No. 1 were not in any event in a position to certify the quantum of tea produced by the defendant No. 1. ( 7 ) THE said application was disposed of in the first Court by an order, dated the 23rd July 1984, as follows:"this application is disposed of by the following order: (i) mr. A. C. Kar and Mr. D. Mukherjee Advocates of this Court are appointed Joint Special Officers in terms of prayers (e) of the Notice of Motion. ( 7 ) THE said application was disposed of in the first Court by an order, dated the 23rd July 1984, as follows:"this application is disposed of by the following order: (i) mr. A. C. Kar and Mr. D. Mukherjee Advocates of this Court are appointed Joint Special Officers in terms of prayers (e) of the Notice of Motion. (ii)the Bank account of the company will be operated jointly by the Special Officers. (iii)there will be an order of injunction in terms of prayers (a) and (d) of the Notice of Motion, confined to the respondent Nos. 2 to 8. All other officers of the Company will continue in their respective posts and will act under the supervision of the Joint Special Officers. (iv) the Joint Special Officers will submit a report recording functioning of the company to Court after five months from date. (v)the Joint Special Officers will be at liberty to arrange for further finance of the company, if necessary and will also be at liberty to continue with the existing arrangements in relation to the management of the company. (vi)the Joint Special Officers will have the liberty to issue duplicate shares, register the shares and to take decision regarding transfer of shares in accordance with law. (vii)in the event of any problem arising regarding finance from the company's bankers, the Joint Special Officers will mention the matter before the court for necessary direction. (viii) (xiii) The Joint Special Officers would, be entitled to a remuneration of 100 Gms each, per month to be paid out of the company's fund. (ix) the matter is part heard and is adjourned for 5 months from date (x)the Joint Special Officers and all parties to act on a signed copy of the minutes of this order on the usual undertaking. (xi)there will be stay of operation of this order for 7 days from date. (xii)interim orders already passed will continue". ( 8 ) THE present appeal is from the said order, dated the 23rd July 1984. The controversies mooted before us were permitted to be argued in certain length and detail as we felt that in any interlocutory order passed at this stage would have a far reaching effect on the ultimate result of the suit. ( 9 ) THE interlocutory orders sought for were also identical with the main, reliefs claimed in the suit. The controversies mooted before us were permitted to be argued in certain length and detail as we felt that in any interlocutory order passed at this stage would have a far reaching effect on the ultimate result of the suit. ( 9 ) THE interlocutory orders sought for were also identical with the main, reliefs claimed in the suit. ( 10 ) LEARNED Counsel for the appellants submitted at the hearing before us that by reason of the order, dated the 23rd July 1984, the suit virtually stands decreed. The management of the company by its directors have been completely superseded and the Court has taken over the entire management of the company. ( 11 ) IT was also submitted that on a proper construction of the provisions of the Companies Act it cannot be said that in i. e. facts of the case the directors-of the company should be held to have vacated or would be deemed to have vacated their once by September 1983. This Court has laid down the law in more than one decision that in the similar circumstances the directors would continue in their office till the appropriate meeting or meetings were held by the company. ( 12 ) IT was contended that the order under appeal is not one which is normally bypassed by way of an interlocutory order in a suit. The learned Judge in passing the said order, it was contended, did not exercise his discretion properly or at all and that in the facts and circumstances the Appeal Court should interfere in the matter and pass suitable order. ( 13 ) LEARNED Counsel for the respondents contended to the contrary. It was submitted that the directors of the company involved in this case must be held to have vacated or deemed to have vacated their office after September 1988. There were decisions of this Court as also of other High Courts where the relevant provisions of the companies Act have been considered and construed and in facts and circumstances similar to those in the instant case it has been held that the directors of a company cannot continue indefinitely without calling the statutory Annual Meetings and if such meetings are not called the directors would be held to or be deemed to have vacated their once by efflux of time. ( 14 ) IT was also contended that, in any event, the directors could not call the Annual General Meetings of the company lawfully or validly after the expiry of the period prescribed by the statute, when only the Central Government could call such a meeting. ( 15 ) IT was contended that the first Court in passing the order which was under appeal had exercised its discretion properly and the Appeal Court should not interfere with the exercise of such discretion. ( 16 ) IN support of their respective contentions learned Counsel drew our attention to the following provisions of the Companies Act, 1956; the Learned Judge then set out the provisions of Ss. 160, 167, 186, 256, 283 of the Companies Act, 1950. Ed. ( 17 ) LEARNED Counsel also cited a number of decisions which have considered hereafter. The following decisions were cited on the question of retirement of Directors at an Annual General Meeting: (A) In re: Consolidated Nickel Mines, Limited, reported in (1914) Ch. 883. The articles of the association of the company involved in this case, inter alia, provided as follows: "101. At the ordinary meeting in 1906 all the Directors and at the ordinary meeting in every subsequent year, one-third of all the Directors for the time being respectively, or if their number is not a multiple of three, then the number nearest to one-third, but not exceeding one-third, shall retire from office. A retiring Director shall retain office until the dissolution of the meeting at which his successor is elected,""104. The company shall, at the meeting at which any director retires in a manner aforesaid fill up the vacated office of each director by electing a person thereto, and without notice in that behalf may fill up any other vacancies unless the meeting determine not to fill up such vacancies". "106. If at any meeting at which an election of directors ought to take place, the places of the retiring directors or such of them as have not had their places filled up, shall, if duly qualified, be deemed to have been re-elected, unless the meeting determine not to fill up such vacancies. " no General Meeting was held or called in the years 1900 or 1907 but the directors continued to act. " no General Meeting was held or called in the years 1900 or 1907 but the directors continued to act. At the Annual General Meeting held in the year 1908 one of the old Directors was reelected and the another director who had been inducted in the Board was also re-elected. The company was directed to be wound up in 1910. The directors claimed their remuneration from the Liquidator and a dispute arose whether they were validly appointed as directors. The learned Judge considered Section 49 of the English Companies Act, 1862, which provided that a General Meeting of a company should be held once in every year. Construing the articles and the said Section of the statute it was held by the learned Judge that the directors vacated office on the 31st December, 1906 being the last day on which the General Meeting of the year could be held and were, therefore, not entitled to any remuneration till they were validly elected. (b) Trade Auxiliary Company v. Vickers, reported in 60 Equity Cases, 303, In this case in a proceeding where dispute had arisen over the management of a company, the Court initially appointed a Receiver for a limited period so that the share register of the company could be corrected. During the pendency of the suit the share register was set right and the meeting of share-holders as ascertained was held and a new Board of Directors was appointed. It was observed by Sir Malins, V. C. as follows: ". . . . . the Court will not interfere with the internal affairs of joint stock companies unless they are in a condition in which there is no properly constituted governing body, or there are such dissensions in the governing body that it is impossible to carry on the business with advantage to the parties interested. In such a case the Court will interfere but only for a limited time, and to as small an extent as possible. "". . . . . . . . there was reason enough for the existence of the suit from its commencement on account of the confusion into which the affairs of the company had been brought, but that the whole object of the suit was accomplished when the governing body was appointed. " (c) Kailash Chandra Dutt vs. Jogesh Chandra Majumdar and Ors. . . . . . there was reason enough for the existence of the suit from its commencement on account of the confusion into which the affairs of the company had been brought, but that the whole object of the suit was accomplished when the governing body was appointed. " (c) Kailash Chandra Dutt vs. Jogesh Chandra Majumdar and Ors. , reported in A. I. R. 1928, Cal. 808. In this case the articles of association of a company provided that the directors were to be elected annually. A General Meeting was convened at which it was proposed inter alia, to elect new directors. Before the election could be held the meeting came to an end. The old directors continued to act and a suit was instituted claiming, inter alia, a declaration that the said directors were no longer the directors of the company and all acts done by them were illegal and void. The suit is decreed, in favour of the plaintiffs. On an appeal it was held by a Division Bench of this Court that if such a declaration was allowed the result would be there will be no director of the company to carry on its business and that such declaration ought not to be given in exercise of the discretion of the Court. It was further observed that so long as the general meeting was not held in which the directors are to be elected the old directors would continue in once. The contention of the plaintiffs that if no General Meeting was held after one year the old directors would automatically vacate their office was not accepted. (d) Re: David Mosely and Sons Ltd. , Mosely vs. David Moseley and Sons Ltd. , reported in 1939 (2) All. E. R. 791. Articles 94 and 96 of the company in that case provided as follows :-art. 94 : "?. At the ordinary General Meeting to be held in the year 1904 and at every succeeding ordinary General Meeting, one-third of the directors (other than the governing directors and managing director or directors), or if their number is not multiple of 3 then the number nearest to but not exceeding one-third, shall retire from office. " art. 94 : "?. At the ordinary General Meeting to be held in the year 1904 and at every succeeding ordinary General Meeting, one-third of the directors (other than the governing directors and managing director or directors), or if their number is not multiple of 3 then the number nearest to but not exceeding one-third, shall retire from office. " art. 96: "the company at any General Meeting at which any director retires in a manner aforesaid shall fill up the vacated office by electing alike number of persons to be directors and may fill up any other vacancies. " ( 18 ) IT was contended on behalf of the plaintiffs in this case that where only two directors were left Article 94 would have no application as two cannot be a multiple of three and there was no number of directors which would not exceed one-third. ( 19 ) THE contention was accepted by the learned. Judge in the Chancery Division who held that the Articles did not provide for the retirement of a director unless one or two conditions satisfied, namely, there must be a number which would be nearest to and would not exceed one-third of the total number. (E) Morris vs. Kanseen and Ors. reported in L. R. 1946 A. C. 459. In this case the House of Lords considered Section 143 of the English Companies Act, 1020 and Article 88 of Table A and held where the term of an office of the director expired but he nevertheless continued to act as a director, his actions could not be validated under the said Section 143 of the statute which provided that the acts of a director or manager shall be valid notwithstanding any irregularity that may afterwards be discovered in his appointment or qualification. Article 88 of Table A of the statute provided that acts done by the directors at a meeting or by any person acting as director would be valid notwithstanding if is discovered afterwards that there was some irregularity in the appointment of the director or directors concerned or that any of them was disqualified was also held not to apply in such a case. (f) A. Ananthalakshmi Ammal and Anr vs. The Indian Trades and 1nvestmenis Ltd, and Anr reported in A. I. R. 1953 Madras 467. (f) A. Ananthalakshmi Ammal and Anr vs. The Indian Trades and 1nvestmenis Ltd, and Anr reported in A. I. R. 1953 Madras 467. In this case the articles of a company, provided as follows:-"at the first ordinary meeting of the company the whole of the directors excepting the ex officio directors, shall retire from office and at the ordinary meeting in every subsequent year, one-third of the directors (other than the ex officio directors) for the time being or of their number is not three or a multiple of three, then the number nearest to one-third shall retire from office. " construing the said article it was held by a Division Bench of the Madras High Court on the authority of Consolidated Nickel Mines Ltd. (supra) and 1944 Chancery 846 another English -decision that the directors of the company would be held to have vacated their office on the last day on which the ordinary meeting of company could have been held. (g) Krishnaprasad Jwaladutt Pilani vs. Land and Mills Co. Ltd and ors. reported in A. I. R. 1960, Bombay 312. In this case a Division Bench of the Bombay High Court considered Section 256 of the Companies Act, 1956 and observed as follows:-"a person who is to cease to be a director by retirement at the expiry of a stated time cannot claim to have escaped such retirement simply because an Annual General Meeting had not been called as required by law within that time. Section 250 does not include those who vacated their office, or ceased to be directors by operation of any provision of law. . . . . . . . . " it has nothing to do with the tenure of the retirement of a director in the proper sense of that expression. The marginal note of S. 256, which we may look at for the purpose of seeing the trend of the section, speaks of ascertainment of directors retiring by rotation and filling of vacancies. It does not lay down any substantive rule as to the tenure of the office of a director. It is not the only section which has to be considered. We have to ascertain the tenure of the once of an elected director not merely from that section but from the language of Ss. 166, 255 and 256 read together. It does not lay down any substantive rule as to the tenure of the office of a director. It is not the only section which has to be considered. We have to ascertain the tenure of the once of an elected director not merely from that section but from the language of Ss. 166, 255 and 256 read together. " "in the context of the tenure of the office of an elected director, the general meeting at which a director liable to retire by rotation shall retire from office" must in our judgment be understood to be a general meeting called in accordance with the mandatory provision of S. 166. It is extremely difficult to see how that tenure of office can be extended simply by not calling the Annual General Meeting and taking shelter under the language of S. 256 which; as we have already said, does not lay down any substantive provision relating to the tenure of the office of an elected director. ""what we have to consider is the meaning and elect of the sections to which we have already made reference and reading those sections, we find little difficulty in reaching the conclusion that, a director vacates his office at the latest on the last day on which an Annual General Meeting could have been called as required by S. 166". ( 20 ) THE decision of the Calcutta High Court in Kailash Chandra Dutta, (supra) was considered and dissented from with an observation as follows:-"with great respect we are unable to agree with this opinion. It appears that the attention of the learned Judges was not drawn to many aspects of the matter nor does it appear that their attention was drawn to the accepted position under the analogous provisions of the English Law. " (H) In re: Hindusthan Co-operative Insurance Society Ltd reported in A. I. R. 1961 Cal. 443. It appears that the attention of the learned Judges was not drawn to many aspects of the matter nor does it appear that their attention was drawn to the accepted position under the analogous provisions of the English Law. " (H) In re: Hindusthan Co-operative Insurance Society Ltd reported in A. I. R. 1961 Cal. 443. In this case in an application under Sections 397 and 398 of the Companies Act, 1956, it was held by a learned Judge of this Court that a director due to retire on rotation at the annual general meeting vacated his office at the latest on the last date on which such annual general meeting could have been called as required by Section 160 of the Companies Act, l956 and cannot continue office thereafter on the ground that the meeting has not in fact been called. ( 21 ) THE learned Judge followed Krishnaprasad Jwaladutt vs. Colba Land and Mill Co. Ltd Morris vs. Kanseen and Consolidated Nickel Mines Ltd (supra ). (I) In the Matter of the Pasari Flour Mills Ltd reported in A. I. R. 1961 Madhya Pradesh 840. In this case the learned Judge of the Madhya Pradesh High Court considered and construed Sections 167, 168 and 256 of the Companies Act, 1956 and observed as follows:-"in Section 186 of the 1956 Act, which empowers the Court to call meetings, an Annual General Meeting is expected. It comes to this, court has power to call or direct the calling of only an extraordinary General Meeting of a company, but not an Annuli General Meeting. ""under the Companies Act of 1956, however, there has been a bifurcation of the power to call an Annual General Meeting and the power to call any meeting other than an Annual General Meeting and the two powers having been separately given to two different authorities (the former to the Central Government and the latter to the Court) they must be exercised in water-tight compartments. " (j) Shrimati Jain vs. Delhi Flour Mills Co. Ltd. and Others reported in 44 Company Cases, 228. In this case a learned Judge of the Delhi High Court considered the question of retirement of directors of the company by rotation under Sections 255 and 256 of the Companies Act, 1956. " (j) Shrimati Jain vs. Delhi Flour Mills Co. Ltd. and Others reported in 44 Company Cases, 228. In this case a learned Judge of the Delhi High Court considered the question of retirement of directors of the company by rotation under Sections 255 and 256 of the Companies Act, 1956. The question which was posed before the Court was whether the directors who have to retire by rotation also vacated their offices by reason of their own failure to call a General Meeting. Decisions of a number of Courts both Indian and English were considered by the learned Judge who came to the conclusion that the questions involved were extremely difficult and complex and could not be decided satisfactorily or properly, colaterally. (k) Richard P. T. J. Chow and ors. vs. James Chow Wakin and anr. reported in 75 C. W. N. 173. Here a suit was filed, inter alia, for a declaration that two of the defendants had not been valid elected as directors of a company or alternatively they had vacated their once or ceased to be directors of the company. In an application made in the suit an interim order of injunction was issued restraining the said defendants from holding themselves out of functioning as directors or interfering with the managements of the affairs of the company. Further injunction was issued restraining the company from holding a meeting of the Board of Directors of the company and from giving effect to the resolution passed at the last of one of such meeting. ( 22 ) ON appeal preferred from the order a Division Bench of this Court held, inter alia, that serious disputes were raised- in the suit. The same should not be adjudicated on a summary manner on affidavits during the pendency of the suit without expressing any opinion on questions in dispute. The Division Bench set aside the order under appeal. (1) The Asansol Electric Supply Co. and Ors. vs. Chunilal Daw and Ors. Reported in 75 C. W. N. 704. The same should not be adjudicated on a summary manner on affidavits during the pendency of the suit without expressing any opinion on questions in dispute. The Division Bench set aside the order under appeal. (1) The Asansol Electric Supply Co. and Ors. vs. Chunilal Daw and Ors. Reported in 75 C. W. N. 704. This decision of a Division Bench of this Court was relied on for the following proposition: it is now an accepted principle of law that were an act by the majority of the share-holders is merely irregular and can be rectified by the majority of the share-holders, an action is not maintainable against that act, but if the act is ultra vires the company itself and is beyond the powers of the members of the company or its share-holders to ratify that act or to rectify the same, an individual member of the company may sue the company and its directors, for himself and on behalf of the other share-holders for declaring that act as illegal and for consequential reliefs. In such actions, however, the plaintiff has no higher right to relief than the company would have as plaintiff. " (m) Hungerford Investment Trust Ltd RF vs. Turner Morrison and Co. Ltd. reported in I. L. R. 1972 (1) Cal. 286. In this case the question of validity of the constitution of the Board of Directors of a company was considered by P. B. Mukharji, C. J. in an application under Section 397 of the Companies Act, 1956. One of the directors was clue to retire by rotation at the Annual General Meeting for the year ending 31st December 1964. He did not do so and it was contended that he could hot be a valid director in 1966. In February and March 1966 a number of other directors were co-opted. It. was contended that the appointment of co-option of such additional directors were invalid as the Board which appointed them included the director who had retired in 1964 and as such Board itself was, not valid. It was contended that under Section 256 of the Companies Act a director must be held to hive retired if the meeting in which he would have retired was held late. It was contended that under Section 256 of the Companies Act a director must be held to hive retired if the meeting in which he would have retired was held late. ( 23 ) IT was contended by the petitioners that reading, Section 256 with Sections 166 and 255 of the Companies Act, the position was clear that if the directors did not call an Annual General Meeting of the company when due, they could riot claim to continue in office as directors on the expiry of the period mentioned in Section 166 for calling the statutory meeting, as a director vacated once at the latest on the last day on which, an Annual Central Meeting could have been called under the said Section. ( 24 ) THE learned Judge referred to Krishna Chandra Dutta (supra) and in Hindusthan Co-operative Insurance Society Ltd (supra), concluded with the following observation :"i should prefer to locate the language of S. 256 of the Companies Act, 1950, which I have quoted elsewhere. The crucial expression in the different sub-sections is 'meeting held'. I would give a plain and ordinary meeting to that expression that the meeting must actually be held. The Companies Act mentions about fictional meetings elsewhere but under S. 256 of the Companies Act it uses the words 'meeting held' and that can only mean that the retirement takes place at the actual meeting 'held'. To my mind S. 256 (4) makes the intention plain and clear. " ( 25 ) THE learned Judge held that the Board of Directors of the company concerned had been validly constituted. ( 26 ) THE following decisions were- cited on the question of interlocutory discretionary orders to be passed and interference by the Appeal Court with such discretionary orders. (N) Asutosh Ghosh and anr. vs. Indu Bhusan Ghose, reported in A. I. R. 1927, Cal. 158. This decision of a Division Bench of this court was cited for the following proposition: "wherever it is necessary for the ends of justice or to prevent an abuse of the process of the Court, the Court always has jurisdiction to pass an order under S. 151, unless its jurisdiction in that behalf has specifically been taken from it. 158. This decision of a Division Bench of this court was cited for the following proposition: "wherever it is necessary for the ends of justice or to prevent an abuse of the process of the Court, the Court always has jurisdiction to pass an order under S. 151, unless its jurisdiction in that behalf has specifically been taken from it. But whether justice does require a Court to invoke its inherent jurisdiction, must be determined with reference to the particular facts of the case and the rule of law that a. Court cannot invoke an inherent jurisdiction where there is a provision in the Code, which, if applied, will meet the justice of the case. " (o) Manilal Mohanlal Shah and ors. vs. Sardar Sayed Ahmed Sayed Mahmad and Anr reported in A. I. R. 1954 S. C. 349. This decision of the Supreme Court was cited for the proposition that the inherent powers of a Court under Section 151 of the Code of Civil Procedure would not be invoked to circumvent, the mandatory provisions of the Code of Civil Procedure. (p) Tulsiram Bhagwandas vs. Sitaram Srigopal, reported in A. I. R. 195s Cal. 389. This decision of a Division Bench of this Court was cited for the following proposition: "the essence of the Code, as is well-known, is to be exhaustive so far as it goes and as respects matters for which the Code expressly provides there is no room for the exercise of any additional jurisdiction under Section 151. ""it is true that on rare occasions it has been held that the Court can act under Section 151 even when the specific provisions of the Code do not apply. "". ?. But the better and the preponderating judicial opinion is in favour of limiting parties to the specific provisions made in the Code. " (q) The Printers (Mysore) Private Ltd. vs. Pothan Joseph reported in A. I. R. 1960 Supreme Court, 1156. "". ?. But the better and the preponderating judicial opinion is in favour of limiting parties to the specific provisions made in the Code. " (q) The Printers (Mysore) Private Ltd. vs. Pothan Joseph reported in A. I. R. 1960 Supreme Court, 1156. This decision of the Supreme Court was cited for the following observation: "it is ordinarily not open to the Appellate Court to substitute its own exercise of discretion for that of the Trial Judge; but if it appears to the Appellate Court that in exercising its discretion the Trial Court has acted unreasonably or capriciously or has ignored relevant facts and has adopted an unjudicial approach then it would certainly be open to the Appellate Court- and in many cases it may be its duty- to interfere with the Trial Court's exercise of discretion. In cases falling under this class the exercise of discretion by the Trial Court is in law wrongful and improper and that would certainly justify and call for interference from the Appellate Court. " (r) Hadmor Productions Ltd. and ors. vs. Hamilton and anr. reported in 1982 (2) Weekly Law Reports, 322. This decision of the House of Lords was cited for the following observations from the judgment of Lord Diplock: "an interlocutory injunction is a discretionary relief and the discretion whether or not to grant it is vested in the High Court Judge by whom the application for it is heard. Upon an appeal from the judge's grant or refusal of an interlocutory injunction the function of an Appellate Court, whether it be the Court of Appeal or your Lordship's House, is not to exercise an independent discretion of its own. It must defer to the judge's exercise of his discretion and must not interfere with it merely upon the ground that the members of the Appellate Court would have exercised the discretion differently. The function of the Appellate Court is initially one of review only. It must defer to the judge's exercise of his discretion and must not interfere with it merely upon the ground that the members of the Appellate Court would have exercised the discretion differently. The function of the Appellate Court is initially one of review only. It may set aside the judge's exercise of his discretion on the ground that it was based upon a misunderstanding of the law or of the evidence before him or upon an inference that particular facts existed or did not exist, which, although it was one that might legitimately have been drawn upon the evidence that was before the judge, can be demonstrated to be wrong by further evidence that has become available by the time of the appeal or upon the ground that there has been a change of circumstances after the judge made his order that would have justified his acceding to an application to vary it. Since reasons given by judges for granting or refusing interlocutory injunctions may sometimes be sketchy, there may also be occasional cases where even though no erroneous assumption of law or fact can be identified in the judge's decision to grant or refuse the injunction is so aberrant that it must be set aside upon the ground that no reasonable judge regardful of his duty to act judicially could have reached it. It is only if and after the Appellate Court has reached the conclusion that the judge's exercise of his discretion must be set aside for one or other of these reasons, that it becomes entitled to exercise an original discretion of its own. " ( 27 ) THE main points on which a prima facie decision is called for in this appeal are whether the defendants Nos. 2 to 8 have ceased to be directors of the defendant No. 1 and would be deemed to have vacated their office by September 1983 as no Annual General Meeting of the defendant No. 1 had been held after the 30th September 1980 and whether in any event it is open to the defendants Nos. 2 to 8 to convene the 74th, 75th and 76th annual general meetings as time to call such meetings have expired as the date expired on the 23rd April 1984 for which the notices have been issued. 2 to 8 to convene the 74th, 75th and 76th annual general meetings as time to call such meetings have expired as the date expired on the 23rd April 1984 for which the notices have been issued. It is also to be decided whether in the facts and circumstances of this case the Appeal Court would interfere with a discretionary interlocutory order of the first Court. ( 28 ) IF the case of the respondents, the plaintiffs in suit, are to be accepted then it is to be held that by efflux of time of the directors of the defendant No. 1 have or would be deemed to have vacated their offices anted have ceased to be directors. The defendant No. 1 is presently without any valid or lawful management and it is only the Central Government which is entitled in law to call a legally valid annual general meeting and put the defendant No. 1 back on its feet, It is also open to the company law board to take steps in the matter and direct calling of the general, meetings for the purpose of election of new directors. There being no valid Board of Directors, it will not be open to a member of the company to requisition an extra-ordinary general meeting of the defendant No. 1 which can be called lawfully by the directors. ( 29 ) THE contention of the appellants on the other hand is that the Board of Directors of the defendant No. 1 has not ceased to exist. There is no question of retirement actual or deemed unless the annual general meeting of the defendant No. 1 is held and only at such meeting the question of retirement of old directors and re-election and election of the new directors would have to be decided. ( 30 ) THE provisions of Section 256 of the Companies Act, 1956 have been noted earlier. It is categorically laid down in the section that 1/3rd of the directors as are liable to retire on rotation, shall retire from office at every subsequent Annual General Meeting. The section envisages that such Annual General Meetings would be held. ( 30 ) THE provisions of Section 256 of the Companies Act, 1956 have been noted earlier. It is categorically laid down in the section that 1/3rd of the directors as are liable to retire on rotation, shall retire from office at every subsequent Annual General Meeting. The section envisages that such Annual General Meetings would be held. It is further provided that if the vacancy caused by a retiring director is not filled up and there is no resolution for filling up the vacancy, the meeting will stand adjourned till a prescribed date and if the same position continues at the adjourned meeting, the retiring director would be deemed to have re-appointed at the adjourned meeting except under certain special contingencies. The scheme of the section is in favour of the continuance and not disruption of management. ( 31 ) IT can very well be contended if re-appointment of retiring directors can be deemed if no ultimate decision is taken at the Annual General Meeting, there is no reason why such deeming clause would not operate in favour of the continuance of a retiring director where no Annual General Meeting is in fact held. ( 32 ) THE above contention finds support the provisions of Section 283 of the Companies Act also noted earlier. The said section categories the situations in which the office of a director of a company would become vacant. If circumstances as laid down in the said section occur or are present a director would automatically cease to a director without any evert decision of the company or its Board or by the Court. The said section does not include the situation or circumstance where no Annual General Meeting has been called within the prescribed time. ( 33 ) IF we look at Article 70, Table 'a', the first schedule to the Companies Act, 1956, we find that where by reason of vacancies in the Board no quorum can be arrived at, it will open to the continuing director or directors to increase a number of directors to reach the quorum or to summon a General Meeting of the company. ( 34 ) AGAIN the object of the statute is not to create a vacuum so far as the management of a company is concerned. ( 34 ) AGAIN the object of the statute is not to create a vacuum so far as the management of a company is concerned. ( 35 ) IT appears that this Court has taken divergent views on the question as will appear from the decisions noted above. In Kailash Chandra Dutt (supra) it was held by a Division Bench of this Court that though the directors were to be elected annually the directors once elected would continue in office though more than a year might pass between the election. ( 36 ) A contrary view was taken in Albert Judah (supra) and also in Hindusthan Co-operative Insurance Society Ltd. (supra) by other learned judges of this court. On the other hand the decision in Kailash Chandra Dutt was approved and allowed by this Court in Hungerford Investment Trust Ltd. (supra ). We prefer and follow the view taken by this Court in Krishna Chandra Dutt and Hungerford Trust Investment Ltd. (supra ). The contrary view, in our opinion, would lead to dislocation in management, deadlock and unnecessary litigation. In the Companies Act, 1956 presently in force, the power to call an annual general meeting has been taken away from the court and conferred on the Central Government. Under Section 167 a member of a company where a deadlock has arisen has only a right to apply to the Central Government for an Annual General Meeting to be called. The Central Government no doubt has been conferred the power to call an Annual General Meeting under the section but it cannot be spelt out from the section that a company or its members can call upon the Central Government to direct the calling of Annual General Meeting as a matter of right within any specified time. This may lead to further dispute and litigation. The management of a company cannot remain in stasis in such a situation. ( 37 ) THE object of the Companies Act cannot be to create a deadlock in the management and to prevent a company from continuing its business and the provisions of the Companies Act must be construed so that the same can enable a company to function and not to cease functioning. ( 38 ) WE also take note of the fact that by the ad-interim order which is under appeal the suit has virtually been decreed. ( 38 ) WE also take note of the fact that by the ad-interim order which is under appeal the suit has virtually been decreed. The Board of Directors have been superseded. By the order of injunction the Annual General Meetings impugned in the suit have been stayed and in fact they have become infructuous as the date on which the said meetings were fixed has expired. The Court has taken charge of the company by appointment of Special Officers. ( 39 ) WE should not lose sight of the fact that the proceedings in the instant case is by way of a suit where interlocutory reliefs have been claimed. Unless there are extraordinary or special circumstances, the Court should not take up the full time management of a running company which will entail supervision of numerous and day to day details and work. ( 40 ) THE order under appeal is one which might have been passed under particular circumstances in a proceeding under Sections 397 and 398 of the Companies Act. But the appointment of Special Officers and the task as entrusted to them in this case are not envisaged by the Code of Civil Procedure or the Specific Relief Act. ( 41 ) THE other point to be considered is whether the defendants Nos. 2 to 8 as directors are entitled to call an Annual General Meeting of the company when the time for calling such meetings have expired and it is not even impossible for the Registrar of Companies to extend such time. We have noted the provisions of Sections 166 and 167 of the Companies Act, 1s56 earlier. In view of the clear language of the said sections, it appears to us that, prima facie, the plaintiffs are entitled to restrain the company and its management from holding an Annual General Meeting beyond a period of 18 months from the date prescribed by the said sections. ( 42 ) FOR the reasons as above, we held that the discretion has not been exercised properly in the first court in passing the said order dated the 23rd July 1984 in its entirety and the said order cannot be supported in its entirety. ( 43 ) THE order under appeal is set aside except that the defendants Nos. 2 to 9 are restrained from calling the three Annual General Meeting under the notices impugned herein. ( 43 ) THE order under appeal is set aside except that the defendants Nos. 2 to 9 are restrained from calling the three Annual General Meeting under the notices impugned herein. ( 44 ) IT will be open to the defendant, No. 1 and its directors to take steps for calling General Meetings or Annual General Meeting in accordance with law as they may be advised. The members of the defendant No. 1 would be at liberty to apply to the Central Government for direction for calling of Annual General Meetings of the defendant No. 1, if necessary. It is made clear that other disputes raised in the suit, in particular, those relating to transfer or registration of shares have not been adjudicated by us in any manner. All interim orders passed by the Appeal Court are vacated except that the directors who have been acting during the pendency of the appeal pursuant to the orders of the appeal court may continue as such subject to a fresh co-option or ratification by the Board. ( 45 ) ALL parties to act on a operative portion of this judgment. Costs in the suit. Suhas Chandra Sen, J. I agree. Appeal Partly allowed