JUDGMENT The Court: This is an application in a suit seeking to restrain the respondents from giving effect to a special resolution passed at the Extra Ordinary General Meeting of the Company held on 25th November, 1991 for the allotment of equity shares worth Rs. 20,00,000/- at the face value of Rs. 10/- per share to the second and third respondents and their associates. 2. The suit was filed, the petition presented, and an interim order obtained just three days thereafter, i.e., on 28.11.91 under the apparent belief of the plaintiff that the formality of actual issuance of the shares was still to be finalized at the proposed board meeting of 30.11.91. But the Plaintiff had not attended on 25.11.91. 3. The second and the third respondents, by the surname Hada, are two shareholders and directors of the Company. The Plaintiff/petitioner, Sunil Jhunjhunwala is also a shareholder, director of the company, which is the first respondent. Originally the Company had been floated by the father of the Plaintiff and one Barat; the Hadas had been brought in by sale of large shareholdings of the plaintiff's father, B.N. Jhunjhunwala. The Plaintiff continued to hold the rest of the shares of his father by inheritance after his father's death. 4. The value at which the shares were bought by the Hadas when they came in 1970 was half the face value. 5. It is almost admitted that at all material times in the current past, it is the Hadas who have been managing the company. Apart from the issuance of the two lakh shares, there is, however, no other allegations that either the Hadas or anybody else has been guilty of any act which has proved to be detrimental to any other party. 6. In or about the 1990, the company was felt to be in need of modernization and therefore of additional funds. The Hadas went about seeking such additional funds and in their efforts approached the IDBI, the tenth (10th) respondent herein. By reason of the successful attempts of the Hadas, a group of Government Finance Companies were ultimately persuaded to lend money to the Company and the IDBI became the lead lending institution. 7. A total package of Rs. 3,62,00,000/- was negotiated for. The exact detail of the break up of this sum is not necessary. By reason of the successful attempts of the Hadas, a group of Government Finance Companies were ultimately persuaded to lend money to the Company and the IDBI became the lead lending institution. 7. A total package of Rs. 3,62,00,000/- was negotiated for. The exact detail of the break up of this sum is not necessary. Suffice it to say that by a letter of intent dated 6th September, 1991, it was intimated by the IDBI to the Company that the loans would be obtainable upon several conditions and two of these conditions were as follows. 8. First, the two respondents being S. N. Hada and S. K. Hada would secure the loan by personal guarantees: without guarantee commission. Secondly the promoters should bring in their entire envisaged contribution of Rs. 20,00,000/- by way of interest free unsecured loans to be converted into equity at a later date. 9. The two Hadas and their associates, have paid around the middle of November 1991 the sum of Rs. 20,00,000/- by way of interest free loan; on 25th November, the special resolution for allotment was passed; on 26th November the loan has been converted into equity by issuance of shares to the lenders. 10. On the 19th November, 1991, the IDBI has paid Rs. 1,00,00,000/- to the Company out of its target figure of Rs. 1,40,00,000/-. 11. It is the admitted position that the Plaintiff knew of possibility of the IDBI loan and of the efforts that were being made therefor. The Plaintiff was also admittedly aware that by two letters dated 16.1.91 and 28.1.91 the Hadas had requested the IDBI to forego the precondition of raising of internal loans. In a board meeting held on 28th June, 1991 which the Plaintiff attended after an absence of two years at the board, the figure of Rs. 3,62,00,000/- and the name of IDBI were both mentioned in the minutes. 12. Admittedly the petitioner took no part in the negotiations before the IDBI. The IDBI was being approached by the Hadas on behalf of the company and by the Hadas alone. 13. 3,62,00,000/- and the name of IDBI were both mentioned in the minutes. 12. Admittedly the petitioner took no part in the negotiations before the IDBI. The IDBI was being approached by the Hadas on behalf of the company and by the Hadas alone. 13. The petitioner has complained that the details of the scheme of conversion of the interest free loan into equity, as would be apparent from the minutes of two board meetings held on 11th September, 1991 and 1st November, 1991 were not circulated, contrary to the admitted usual practice of the company regarding circulation of board minutes. I might remark that none of the board meetings is a subject matter of challenge in the plaint. It is also not the complaint of the petitioner that the notice of any board meeting was suppressed. On the other hand the petitioner did evince a certain apathetic attitude towards the company by attending five out of the last 22 board meetings in the past five years. 14. However the petitioner was not sought to be removed from the Board, because, as I have said, prior hereto the parties had no complaint against one another. 15. The notice of the meeting of 25th November was settled at the Board meeting of 1st November, 1991 and the same was posted under certificate of posting. The petitioner has made a comment that production of documents regarding such posting under certificate only during the course of the present hearing is suspicious. 16. It is not very material to enter into the question of sending of notice by certificate of posting today as the petitioner admits to have received through his employer the EGM notice on 4th November, 1991. 17. The second item in the notice clearly specified about allotment of shares to be made to the Hadas and their associates. The explanatory statement to the said notice contained the following sentence: "As per directions of the IDBI interest free loans has been/to be extended by Shri S.N. Hada, Shri S. K. Hada and their Associates." 18. Practically the entire case of the petitioner turns on this sentence contained in the explanatory statement. The first and foremost point urged in support of this application was that the said statement violates the mandates of s. 173(2) of the Companies Act as interpreted by several authoritative decisions. 19. Practically the entire case of the petitioner turns on this sentence contained in the explanatory statement. The first and foremost point urged in support of this application was that the said statement violates the mandates of s. 173(2) of the Companies Act as interpreted by several authoritative decisions. 19. It is, in my opinion, unnecessary to refer to these decisions in any very great detail as the principles are well settled. All material facts must be set out. These must not be trickily or misleadingly put. The explanatory statement shall not be benevolently construed and shall be carefully scrutinized. 20. Mr. Kapoor appearing for the petitioner first relied upon the case of Biswanath Prasad Khaitan, reported in 31 Company Cases Page 125 and placed the passage at page 134 to 135. It was said there that the notice must be fairly and intelligibly framed and "it must not be misleading or equivocal. A benevolent construction cannot be applied". 21. The next case was of Shalagram Jhajharai, reported in 35 Company Cases page 706. The passage at Page 725 was relied on where it was, inter alia, held that if the interest of the directors was not mentioned or disclosed in the explanatory note at all, the same might well be construed as breach of s. 173(2). 22. The next case relied upon was that of Firestone Tyre and Rubber Co., reported in 41 Company Cases, page 377. The passage at pages 436 and 437 was relied upon and it was said on the basis thereof that the explanatory statement is a mandatory requirement of the section and that the purpose of the meeting should be sufficiently clarified for the notice not to be tricky. The following passage of Lindley M.R. was relied on: "It is a tricky notice, and it is to my mind playing with words. . . . . . . . I do not think that this notice discloses the purpose for which the meeting is convened." 23. The next case was that of Jadavpore Tea Company, reported in 55 Company Cases Page 160. This was a Ss. 397, 398 application where all allegations had failed in the Court below and the only point surviving before Division Bench was regarding improper issuance of shares. The judgment of Justice Sabyasachi Mukherjee was relied upon and the passages at. pages 169 and 170 were placed. This was a Ss. 397, 398 application where all allegations had failed in the Court below and the only point surviving before Division Bench was regarding improper issuance of shares. The judgment of Justice Sabyasachi Mukherjee was relied upon and the passages at. pages 169 and 170 were placed. In that case it was nowhere disclosed in the proceeding as to who were the allottees of the new snares. It was said at page 70 as follows : (bracketed words are mine). "Though it is quite true........ that on........ the section it was not obligatory that a special resolution........ must always........ (be such) that the persons or the allottees' names should specifically be (given) or the manner of their allotment should also be specifically indicated, but, in an appropriate case, that is say, where the allotment of shares might till the balance of the shareholding and might transform the major bulk of the shareholders into a minority group of shareholders, the particulars of the allottees or the manner of their allotment should also be indicated. This is necessary........ to ensure fair play in action in corporate management........." 24. The case of Gluco Series, reported in 61 Company Cases Page 227 was also relied upon. It was said on the basis of the said case that if by allotment of shares an existing majority of shareholders are reduced to a minority, the Court will scrutinize the same with particular, circumspection and unless it is satisfied beyond reasonable doubt that such issue was unavoidable or was resorted to as an express and emergency measure with an object of fundamental importance, for example, saving the existence of the Company, it will not allow the existing balance of power in that Company to be disturbed. 25. The case of Lalji Bhai, reported in AIR 1972 Bombay page 277 was relied upon for the proposition that for breach of s. 173 the action taken at the meeting is vitiated. Head Note 'D' and paragraph 34 were placed in this regard. 26. The next case was of Asansol Electric Supply Co., reported in AIR 1972 Calcutta page 19. The case of Lalji Bhai, reported in AIR 1972 Bombay page 277 was relied upon for the proposition that for breach of s. 173 the action taken at the meeting is vitiated. Head Note 'D' and paragraph 34 were placed in this regard. 26. The next case was of Asansol Electric Supply Co., reported in AIR 1972 Calcutta page 19. Paragraph 30 of the judgment was relied upon and the learned Single Judge said as follows at the end of the said paragraph (in relation to s. 171 and 172 of the Companies Act, 1956): "I hold accordingly that the provisions of the said Section have been made expressly mandatory and for good reasons and the same must strictly complied with to ensure the validity of resolutions passed at the meeting and non-compliance of the said provisions would make such resolutions void and ultra vires." 27. Mr. Kapoor extensively relied upon the case of Fire Stone Rubber already referred to above and said on the basis thereof that if there has been a breach of s. 173(2) the complaining shareholders might come either before or after the meeting. 28. The facts of this case would have to be applied to the law set out in the above authorities and also to certain other points of law which" emerged from the authorities cited by Mr. Dipankar Ghosh in this regard to which I shall make reference later. I do not find that the explanatory statement contained anything erroneous, tricky or misleading. It is, in my opinion, an incorrect approach to-day to enquire whether by the word "Promoters" the IDBI meant the Hadas exclusively. The affidavit of IDBI says that they did not mean the Hadas exclusively. On the other hand the letter of intent mentioned above as well as the internal apprisal note (a copy of which was surprisingly produced, not by the IDBI, but by. Mr. Dipankar Ghosh's client) do mention the Hadas as they also mentioned the word 'Promoters and they also mention the associates of the Hadas. 29. Only the Hadas were before the IDBI moving to obtain large loans. The question whether any others, be they the general residuary body of the shareholders of the Company or be he the petitioner, in particular, were not the body or the persons upon which the attention of IDBI. Was focussed. 29. Only the Hadas were before the IDBI moving to obtain large loans. The question whether any others, be they the general residuary body of the shareholders of the Company or be he the petitioner, in particular, were not the body or the persons upon which the attention of IDBI. Was focussed. It is not a rule of law of corporate management that in securing loans for the Company the directors shall always approach institutions with the entire body of the shareholders at their tail. The Hadas were ready to plunge their neck further forward than any of the other shareholders or directors and thus they were to grant personal guarantees. they were also ready to pilot the scheme of obtaining of interest free loans for the not unsubstantial sum of Rs. 20 lakh for the purpose of later conversion into equity. 30. The IDBI was quite prepared to take the twenty lakhs participation from the Hadas or their associates. The question whether the IDBI was also prepared to take a part of it from the petitioner or from any other shareholders was not a question that was put forward before the IDBI at all. Under these circumstances, the explanatory statement with perfect frankness and accuracy reproduced the then situation, the IDBI had called for the loan from the Hadas and their associates; 31. I must emphasize that the legality of a particular group of shareholders contributing the interest free capital for conversion into equity is an absolutely separate question. The question that I deal with now is whether the explanatory statement reproduced the factual situation fairly' and intelligibly even if it is construed with the utmost strictness. In my opinion, it passes the tests easily and accordingly there was no breach of S.173(2) of the Companies Act as judicially explained. The other angle from which the explanatory statement is to be approached is this. The requirement of s. 173(2) is mandatory, but that does not explain' whether the statement has to be objectively satisfactory or subjectively so. In other words, a statement read by an outsider might appear to be in some sense falling short of the requirements of an explanatory statement. However, even this same statement, read by a shareholder, might not be unsatisfactory at all because of any special knowledge possessed by the shareholder himself. In other words, a statement read by an outsider might appear to be in some sense falling short of the requirements of an explanatory statement. However, even this same statement, read by a shareholder, might not be unsatisfactory at all because of any special knowledge possessed by the shareholder himself. In a representative company action, which raises a question about the insufficiency of an explanatory statement, the above distinction might be of no practical importance. The special knowledge of the shareholders, all and sundry cannot be separately enquired into for coming to a conclusion that the statement is subjectively satisfactory even if not objectively so. But it is quite another matter in a personal action like the present where only one shareholder is the complaining plaintiff. There, if his special knowledge, would dispel any trace of unsatisfactoriness from the explanatory statement, then such special knowledge, in my opinion, is a relevant factor in considering the reliefs to be granted. Mr. Ghosh referred in this regard to three authorities. These were not even dealt with by the petitioner's counsel in reply. The first of those is the case of Surajmull Nagarmull, reported in ILR 1973(1) Cal. page 207, Mr. Ghosh placed portions from page 289 of the said Judgment and the following passage occurs there: "These provisions, relating to notice, contained in Ss. 171, 172, and 173 of the Act, are, in my opinion, in the nature of statutory directions or instructions to the Company, enacted in the interest of the shareholders to enable them to participate effectively at the meetings of the Company. Any breach of these provisions or requirements, does not necessarily have the effect of invariably invalidating the' meeting and nullifying the proceedings thereof. The effect of any breach of, these provisions on the meeting and its: proceedings will ‘c' depend on the facts and circumstances of each case. A breach of these statutory requirements may in appropriate cases invalidate the "meeting and the proceedings thereof; and in proper cases, the meeting and the proceedings thereof may be held to be valid notwithstanding any' such breach”'; 32. Mr. Ghosh also relied in this respect upon the decision of the Judicial Committee in the case of Parashuram reported in AIR 1928 Privy Council. page 180; Mr. Ghosh relied upon a passage at p. 184, right column bottom. Mr. Ghosh also relied in this respect upon the decision of the Judicial Committee in the case of Parashuram reported in AIR 1928 Privy Council. page 180; Mr. Ghosh relied upon a passage at p. 184, right column bottom. The passage contains, inter alia, the following : "The next objection to the validity of the scheme was that sufficient information as to its real effect was not given to the shareholders . . . . . . . . Here the fact that the action 'is personal' to the appellant is 'unfortunate for him:' 'He at least Knew before the' first meeting everything' about the Scheme that was to be known". 33. The decision of the Judicial Committee in the above case was applied by a Division Bench of this Court in relation to s. 173(2) in the case of Maharani Lalita reported in 32 Company Cases page 207, At page 213, the judgment of Justice P.B. Mukherji contains the following paragraph: "The first answer on the facts follows from the proposition that if a shareholder is aware of the facts, it is not for him or her to complain of the insufficiency of notice of a meeting. This principle was laid down by the Privy Council where again Lord Blanesburgh at page 185 observed: 'that no possible complaint of the notice or circular on the ground of insufficiency is, therefore, open to him'." 34. In the present case, the Plaintiff was especially aware of the IDBI scheme whereby interest free loan would be attracted into the Company for conversion into equity. It was also known to the Plaintiff that the Hadas were moving for the IDBI loans and that they were seeking a waiver of the precondition of the internal advance equity to be raised by the Company. Jhunjhunwala well knew that the IDBI could not and did not ever say that they would accept the loan from none others than the Hadas and their Associates. Jhunjhunwala also knew that neither he, nor anybody else had approached IDBI, so that the question of anybody else participating in the grant of the interest free loan was outside the purview of possibilities before the IDBI. 35. Jhunjhunwala also knew that neither he, nor anybody else had approached IDBI, so that the question of anybody else participating in the grant of the interest free loan was outside the purview of possibilities before the IDBI. 35. Under these circumstances, the plaintiff was particularly well equipped to understand that the directions of IDBI quoted in the explanatory statement regarding interest free loan to be extended by the Hadas and their Associates, did not refer to any exclusive direction by IDBI. Jhunjhunwala knew that the Hadas and their associates had been asked to contribute. Jhunjhunwala knew that others had not been asked to contribute, because they were not before the IDBI. By the non-mention of these other absent parties in the explanatory statement, Jhunjhunwala of all people could not have been misled into believing that the IDBI had expressly excluded these other theoretically possible alternative sources of interest free accommodation. Under these circumstances, I come to the conclusion that the explanatory statement was perfectly satisfactory, particularly in relation to the plaintiff/petitioner, apart from the same being generally satisfactory as I have explained earlier. 36. The next point was the scope and applicability of s. 81 of the Companies Act. The relevant portion of the said Section is set out below:- "Further issue of capital. 81. 36. The next point was the scope and applicability of s. 81 of the Companies Act. The relevant portion of the said Section is set out below:- "Further issue of capital. 81. (1) Where at any time after the expiry of two years from the formation of a company or at any time after the expiry of one year from the allotment of shares in that company made for the first time after its formation, whichever is earlier, it is proposed to increase the subscribed capital of the company by allotment of further shares, then- (a) such further shares shall be offered to the persons who, at the date of the offer, are holders of the equity shares of the company, in proportion, as nearly as circumstances admit, to the capital paid up on those shares at that date; (b) the offer aforesaid shall be made by notice specifying the number of shares offered and limiting a time not being less than fifteen days from the date of the offer within which the offer, if not accepted, will be deemed to have been declined; (c) unless the articles of the company otherwise provide the offer aforesaid shall be deemed to include a right exercisable by the person concerned to renounce the shares offered to him or any of them in favour of any other person; and the notice referred to in clause (b) shall contain a statement of this right; (d) After the expiry of the time specified in the notice aforesaid, or on receipt of earlier intimation from the person, to whom such notice is given that he declines to accept the shares offered, the Board of directors may dispose of them in such manner as they think most beneficial to the Company; Explanation: In this sub-section, "equity share capital" and "equity shares" have the same meaning as in s. 85. (1A) Notwithstanding anything contained in sub-so (1), the further shares aforesaid may be offered to any persons whether or not those persons include the persons referred to in clause (a) of sub-s. (1) in any manner whatsoever - (a) if a special resolution to that effect is passed by the company in general meeting." 37. It was said that the provisions under S. 81(1A) permitted the company in general meeting only to offer the shares to any person. It was said that the provisions under S. 81(1A) permitted the company in general meeting only to offer the shares to any person. It was objected that in the instant resolution the same sought not only to offer but actually to allot the shares. It was said that one day after the meeting that is on 26th November, 1991 the shares were actually allotted to the Hadas and seven of their associates. 38. In this regard the Companies (Issue of Shares Certificates) Rules, 1960 framed under s. 642 of the Companies Act was relied upon and Rule 4 thereof was placed. The said rule states that when a company issues any capital no certificate of any share or shares in relation to the company shall be issue except in pursuance of a resolution passed by the Board. The other parts of the rule are not material. 39. It should be noted that though there was no board resolution allotting the shares after the 25th November, 1991 yet there were earlier board resolutions dated 11.9.91 and 1.11. 91 permitting such issuance to the persons to whom the shares might be allotted in the general meeting. 40. In any event, I am unable to find ins. 81(1A) any such indication of the legislative intent whereby it would have to be held that the power of the board to allot shares, upon a special resolution for offer thereof; cannot be exercised by the company in general meeting. Normally a company can do in general meeting all acts which are intra vires the, company. No authority was cited for establishing the proposition that the allotment of shares must be by board resolution and board resolution alone and cannot be the subject matter before a body, which is superior to the board, that is the company itself in general meeting. 41. It is pertinent to note in relation to s.81, that-the Sub-s. (1) would have no application in the particular facts and circumstance of this case. The shares were not being issued in the normal, or ordinary way. The shareholders were not to be offered, and thereafter if the offers were accepted allotted the shares. Only those would be offered who had contributed interest free loan. Again the Hadas and their associates, were to contribute, even if the associates were riot already shareholders of the company. The shares were not being issued in the normal, or ordinary way. The shareholders were not to be offered, and thereafter if the offers were accepted allotted the shares. Only those would be offered who had contributed interest free loan. Again the Hadas and their associates, were to contribute, even if the associates were riot already shareholders of the company. Under these circumstances a special resolution under S. 81(1A) was the only possible alternative. 42. No grievance has been raised me on the count that the special resolution did not precede the acceptance of the interest free loans 'by the company. "Indeed the company having passed the special resolution accepting the offer of the interest free lenders, the question has to-day perhaps lost all but academic importance to the contesting parties. 43. The next argument was that even if the explanatory statement is sound and the Companies Act has been complied with in its letter, yet there has been a breach of fiduciary duty owed by the Hadas to the plaintiff. That a fiduciary duty of some sort is owed by the Director to the company as well as to the shareholders is indisputable. The three Judge decision of the Supreme Court in the case of Bijaj Auto Limited dealing with the registration of transferred shares contains the following portion in paragraph 13 of the Judgment of the Court delivered by Justice A.N. Ray:- " . . . . . . . . the Directors are in a fiduciary position both towards the company and towards every shareholders". 44. No doubt as pointed out by Mr. Ghosh the Supreme Court was concerned with specific points mentioned, inter alia, in paragraph 15 of the judgment but on the doctrine of precedent to-day prevailing the above observation of the Supreme Court is binding. 45. For the above reason it is unnecessary to enter into a' discussion of the various other authorities relied upon by Mr. S.B. Mookherjee Mr. Kapur and Mr. Ghosh regarding the fiduciary duty owed by a director. 46. In the instant case, however, no such breach of fiduciary duty, mentioned somewhat' vaguely in paragraph 32 of the plaint, can be spelt out. The plaintiff received the notice of the general meeting. S.B. Mookherjee Mr. Kapur and Mr. Ghosh regarding the fiduciary duty owed by a director. 46. In the instant case, however, no such breach of fiduciary duty, mentioned somewhat' vaguely in paragraph 32 of the plaint, can be spelt out. The plaintiff received the notice of the general meeting. The story that he did not read it (though an employee had, on 4.11.91 received it) until the meeting was held on 25th November, 1981 does not wash in a commercial court of Law. The eighteenth paragraph of the petition, in this context, may be read. It doesn't explain how the petitioner ultimately came to read the notice of the EGM, where, or exactly when, Yet he was ready with plaint, petition and legal grievance in three days. It "must be assumed that the plaintiff had constructive notice of the EGM," even if somebody could be found in these hard days who is so soft hearted as to believe in the plaintiff's ignorance. 47. The plaintiff, therefore, knew that the entire scheme of loan to be given by the Hadas and their associates was about to materialize into a crystallized right. The Plaintiff also knew that the loan was being obtained for getting the desirable benefit of large accommodation by the Company from IDBI and other financial institutions. The Hadas were definitely discharging their fiduciary duty towards the company. If the plaintiff chose to stay away from the board meetings in general, and not to contribute money towards the interest free equity, it was the plaintiff's own choice. Everything had been made plain and above board. At least everything was plain to the plaintiff himself. Under these circumstances it is difficult to find out in exactly what the Hadas are said to have been broken their fiduciary duty. Two detailed board resolutions of 11.9.91 and 1.11.91 had not been circulated contrary to usual practice. It the plaintiff wanted to keep abreast of the details regarding granting of loan he as a Director was in the best position to know all facts. The Hadas cannot be said to have kept anything a deliberate secret from the plaintiff. If the plaintiff did not know, which is difficult to believe, the plaintiff did not want to know either. 48. A hyper-technical point was touched as to the brevity of the notice of the meeting. The Hadas cannot be said to have kept anything a deliberate secret from the plaintiff. If the plaintiff did not know, which is difficult to believe, the plaintiff did not want to know either. 48. A hyper-technical point was touched as to the brevity of the notice of the meeting. If the notice is received on 4th November, 1991 then 20 clear days and not 21 elapsed before 25.11.91. The relevant sections regarding notice are Ss. 51 and 53(2) (b) of the Companies Act. It is unnecessary to deal with them in detail. The Calcutta view is that a short notice of meeting will not vitiate it unless some prejudice can be shown to have been caused by reason of the shortness of the notice. This was decided by a Division Bench in the case of Calcutta Chemical reported in 58 Company Cases Page 275. Mr. Ghosh placed a passage therefrom at page 279. Mr. Ghosh also relied upon the case of Kanaklata reported in AIR 1970 Calcutta page 328 for saying that the presumptive evidence in respect of notice sent under certificate of posting could in any event be relied upon by the company as those had been despatched on 1.11.91 and from 48 hours after 1.11.91, 21 clear days had elapsed before 25.11.91. In my opinion, the above point of one day's shortness of notice is too arithmetical to satisfy the substantial curiosity of any enquiring legal mind about the justice and right of the parties in any case, including the present. 49. The plaintiff was supported by several respondents and Mr. Anindya Mitra appeared for Respondent No. 12. He was prepared to contribute by way of security Rs. 10/- per share for proportionate share issue and was thus prepared to deposit Rs. 74,700/- for continuance of the order of injunction obtained herein. The petitioner was willing to put in Rs. 20 lakhs for continuation of the order of injunction. 50. The petitioner even offered to buy shares equal to those bought by Hadas and their associates even at Rs. 45/- per share. It is possible that after the IDBI injection of Rs. 1 crore, the share value has gone up. But there was nothing to prove that in November, 91, the share value was not around Rs. 4.15 per share as mentioned in the explanatory statement. 45/- per share. It is possible that after the IDBI injection of Rs. 1 crore, the share value has gone up. But there was nothing to prove that in November, 91, the share value was not around Rs. 4.15 per share as mentioned in the explanatory statement. The upshot is, that the plaintiff appears to have deliberately missed the bus, and now is hiting his hands to get into it. 51. Mr. Mitra submitted that according to the stock exchange quotation, the share certificates should have been issued in bunches of 100 shares and that a violation of such issuance directives might lead to loss by deli sting of the shares by the stock exchange as this violates the terms of the listing agreement. In my opinion, the argument is too far fetched at this interlocutory stage for the purpose of arguing upon a restraint order regarding voting on the shares already paid for by the Hadas. No threat by the stock exchange is practically in sight. There is no proof either that the share certificate already held by the shreho1ders are in bunches of 100 shares, or in accordance with past different directives, if any. 52. By reason of the additional issuance of shares, the Plaintiff from being an above 30%, shareholder falls to being a below 20 shareholder. It was said that by such fan in shareholding, the plaintiff would be unable to prevent any special resolution by reason of voting rights alone. No scheme by the Hadas is alleged to be afoot, much less any proposed particular special resolution which is about allegedly to defeat any interest of the Company. 53. Both sides have cited cases before me to the effect that company powers cannot be exercised save in accordance with sound equitable principles. Issuance of share capital, for example, intended for the purpose of increasing the majority of a particular group, and not for the benefit of the Company, would be in breach of such equitable safeguards and thus be in any event void. Mr. Mookherjee for the petitioner relied in this regard upon the case of Clemens vs. Clemens Bros. Ltd. and Anr. reported in 1976 (2) All E.R. Page 268 and Mr. Dipankar Ghosh relied in this respect upon the two Supreme Court cases of Nanalal Zaver & Anr. Mr. Mookherjee for the petitioner relied in this regard upon the case of Clemens vs. Clemens Bros. Ltd. and Anr. reported in 1976 (2) All E.R. Page 268 and Mr. Dipankar Ghosh relied in this respect upon the two Supreme Court cases of Nanalal Zaver & Anr. and Needle Industries (India) Ltd., reported respectively in AIR (1950) Supreme Court page 172 and AIR 1981 Supreme Court page 1298. The falling of the plaintiff's shareholding below 25% therefore does not mean that he is wholly at the mercy of whatever the Hadas might wish to do. 54. The above observations of mine whatever might be their value from the doctrine of precedent, are and cannot but be, observations of prima facie nature without prejudice to the rights and contentions of the parties at the ultimate trial of the suit. On the prima facie view, however, the plaintiff's suit appears to be wholly unmaintainable and a mere attempt after the event for larger participation in a company which has become Incrative by the sale efforts of the other group. 55. From the point of view of balance of convenience the plaintiff is not under any jeopardy whatsoever. The Annual General Meeting is to be held sometime near the end of September, or so, but apart from a vague feeling that the Plaintiff is in the minority and will not be able to stop any special resolution, the Hadas are not even alleged to be plainning or doing something which is of even remote danger to any legal right or interest of the Company or the plaintiff or any of its other shareholders. 56. Under these circumstances, the application must stand dismissed with costs. The interim orders of restraining already passed earlier on this application in the 28th November, 1991 and 4th December, 1991 have so far restrained the Hadas and their associates from voting on the basis of their purchased shares. In fairness to them and their capital contribution and all the good that they have done to the finances of the Company, the interim orders should naturally forthwith stand vacated. 57. The above order disposes of the application initiated by way of the Notice of Motion taken out by M/s. Dube & Co. on behalf of the plaintiff/petitioner dated 28th November, 1991 and the same is dismissed with costs; all interim orders vacated. 57. The above order disposes of the application initiated by way of the Notice of Motion taken out by M/s. Dube & Co. on behalf of the plaintiff/petitioner dated 28th November, 1991 and the same is dismissed with costs; all interim orders vacated. The parties and all others concerned in the matter will act upon a copy of this Dictated Order upon the usual undertaking is to its completion being given on the part of the Advocates-art-word for the petitioner and those for the respondent Nos. 1, 2 & 3. Application dismissed and interim order vacated.