B MATHA GOWDER Vs. M S KADA GOWDER

JUDGEMENT

(1.) THIS is an appeal against the order of the learned DISTRICT jUDGE, Coimbatore, in I.A. No. 423 of I954 on his file in O.P.No. 225 of I952 on the file of the High Court, Madras Kundah Trading Co. Ltd. was directed to be wound up by an order of this court dated September 22, I953, in the said O.P.No. 225 of I952. On January 28, "I954, the against the respondent herein for the following reliefs namely, for a direction to the respondent to render an account of his management of the company during his period as managing director, pay t all sums that may found due by him to the company and to retire to the company the unlawful gain to the tune of Rs. 49, 000 illegally made by him in the matter of purchase of the tea factory belonging to the company and the pay other sums, namely, Rs. 7, 500 being the price of tea taken by the respondent and Rs. 21, 000 alleged to be due as consideration for the assignment to the respondent of a promissory note executed by the appellant in favour of the company The affidavit filed in support of the application contained the following allegations. On May 19, 1946 he tea factory at Hibbada together with its fixtures was agreed to be sold by the company to the appellant on the understanding that the appellant would take over the outstanding (Rs. 73, 007-II-4) found due to the company and discharge the company's debts which amounts to Rs. 1, 84, 951-1-3. In other words the sale was for a consideration of Rs. 1, 12, 000 The transaction however fell through ON July 5, 1946 the same factory was agreed to be sold to the respondent herein for a sum of Rs. 70, 700 The respondent had been the managing director of the company from July 30, 1945 up to July 5, 1946 on which date he resigned from the said office, though the continued to be a director till July 29, 1947 on which date he resigned from that office also. The said price of Rs. 70, 700 was further reduced to Rs. 63, 200The tea stock worth amount Rs. 20, 000 was taken for Rs. 7, 500 and even this amount had not been paid, The sale deed executed by the company in favour of the responded directed the respondent to discharge certain debts which he did not discharge. On the other had the directors had to borrow moniues to make payments towards the said debts.

(2.) THE company assigned in favour of the respondent a promissory note which the appellant had executed in favour of the company on September 5, 1946, as security for any deficit which may be due to him in the course of his management of th company THEre was no consideration for the assignment in favour of the respondent but he filed a suit on foot of the said promissory note against the appelllat , O, S. No.16 of 1947 ad obtaine a decree therin On these allegations the appellant charged the responded with misfeasance as the compan7y lost by the reduction of the sale price to an extent of Rs. 49, 000 and as quantities of tea worth nearly Rs. 29, 000 had been taken by the respondent for a sum of Rs. 7, 500 THE respondent was also said to be quality eve of other acts of misfeasance committed by him as managing director and as director of the company. THE respondent pleaded, inter alia that the appellant had no locus stain to filed the application and that the proper person to file the application was the official liquidator that the appellate was bitter enemy of his and that the application had been filed out of spite mad to wreak his vengeance on the respondent for having obtained a decree against him in O.S. No. 16 of 1947.

(3.) HE therefore dismissed the application and hence the present appeal. The appellant's application as already mentioned purports to be under the two section of the Companies Act, 1913, namely sections 185 and 195. In so far as they are material they run thus