SOUTH INDIAN BANK LTD Vs. JOSEPH MICHAEL

JUDGEMENT

(1.) These appeals arise from the judgment of a learned Judge of this Court in B. C. P. Nos. 2 to 13 and 15 to 17 of 1975. The learned Judge disposed of the 15 petitions by a common judgment on the basis of the facts in B.C.P. No. 2 of 1975 as all the other petitions arose in identical circumstances and related to a common question. It is with reference to B.C P. No. 2 of 1975 that we propose to dispose of all the fifteen appeals by this common judgment.

(2.) The appellant is a banking company having its registered office at Trichur, and we shall refer to it as the 'company'. The 1st respondent (who was the petitioner in the B.C.P.) is a transferee of shares from the 2nd respondent and we shall respectively refer to them as the 'transferee' and 'transferor'.

(3.) The case of the transferee is that he purchased 210 equity shares from the transferor on 22nd January 1975 for a consideration of Rs. 10,000/- and forwarded to the company the share transfer deed duly executed by the transferor and transferee together with the share certificates relating to the said shares for registering the transfer and entering the name of the transferee on the register of the company as the holder of the said 210 shares. But the company informed the transferee by a letter dated 18th March 1975 that the board of directors of the company, in exercise of their power under Regulation.42 of the articles of association of the company, read with S.111(1) of the Companies Act, 1956 ("the Act"), refused the application to register the transfer. According to the transferee the board of directors have acted capriciously, mala fide and in excess of their power in refusing to register the transfer of the shares.