UNION OF INDIA Vs. MOHANLAL ISHWAR DASS PANCHAL

JUDGEMENT

(1.) This appeal by certificate arises from the judgment of a Division Bench of the Gujarat High Court in Spl Civil Appln. No 1055 Of 1965 on its file.

(2.) The 1st respondent herein is the Chairman of the Board of Directors of Kathiawar Industries Ltd. The Custodian of Evacuee properties sought to proceed against that company under Section 10 (2) (11) of the Administration of Evacuee Property Act, 1950 (to be hereinafter referred to as the 'Act') . The 1st respondent challenged those proceedings before the High Court of Gujarat by means of a petition under Article 226 of the Constitution. The High Court has allowed that petition and quashed the impugned proceedings. Hence, this appeal.

(3.) The issued capital of Kathiawar Industries Ltd., is Rs. 5 lacs. The total number of shares subscribed, preferential as well as ordinary are 1,21,961. One of the shareholders of that company is a company by name Bhawani Investment Company Ltd. That company held 12,100 shares. The case of the appellants is that all the shareholders of Bhawani Investment Co- Ltd., had become evacuees and therefore the Bhawani Investment Co Ltd. has become an evacuee property. The 1st respondent denied the fact that all the shareholders of Bhawani Investment Co. Ltd., had become evacuees. That issue had not been gone into by the High Court. The High Court has assumed for the purpose of this case that all the shareholders of Bhawani Investment Co. Ltd., had become evacuees but it opined that that fact cannot make the Bhawani Investment Co. Ltd., an evacuee property. It observed that an incorporated company has a personality of its own different from that of its shareholders and that personality does not disappear with the transfer of the shares of its shareholders.