SHIROMANI SUGAR MILLS LTD Vs. DEBI PRASAD

JUDGEMENT

(1.) This and civil Revisions NOS. 122 to 154 of 1945 are applications in revision under Section 25, Small Cause Courts Act, against judgments passed by the Small Cause Court Judge, Gorakhpur, in suits filed by the Official Liquidator of the Shiromani Sugar Mills Limited, Khalilabad against a number of ex share-holders of the Shiromani Sugar Mills Ltd. for allotment, first call and second-call moneys. There were as many suits as there are revisions; they were all of similar nature and the same disputes were involved in all. They were consolidated by the learned Small Cause Court Judge and tried together. He delivered one judgment dismissing all the suits.

(2.) The Company which was a public limited Company was formed with a large number of objects, the first and most important object being :

(3.) The authorised capital of the Company was fixed at RS. 20,00,000 divided into Rs. 15,000 preferred shares of Rs. 100 each and RS. 50,000 ordinary shares of Rs. 10 each. The earned capital according to the prospectus was Rupees 16,00,000 divided into Rs. 12,000 preference shares and Rs. 40,000 ordinary shares. In most of these revisions we are concerned with only preference shares and I shall deal only with them. Out of Rs. 100, the price of a preference share, Rs. 20 were payable on application for the share, Rs. 30 were payable on the share being allotted and the balance of Rs. 60 was payable in such call or calls as might be decided by the Directors from time to time. Under Article 32 of the Articles of Association a share became liable to forfeiture if the call or instalment or allotment money was not paid by the share-holder within the fixed time. The business of the Company was to be conducted by Managing Agents, subject to the control of the Directors and Messrs. Sharma, Varma and Company were the first Managing Agents. The maximum number of Directors fixed under Article 172 are 17. The qualification of a Director as fixed under Article 156 was "the holding of shares of Rs. 5,000 at least In the capital of the Company in his own name and right." Article 157 provided that: