S BAGLA Vs. GOVINDRAM BROS PVT LTD

JUDGEMENT

(1.) In this suit after certain documentary and oral evidence is tendered (on behalf of the plaintiffs) counsel for the parties have indicated to me that if I give my ruling as to the true construction and effect of the provisions of s. 346 of the Indian Companies Act at this stage, the same would tend to save time and curtail evidence to be tendered. It is only because all sides have desired that I should do so at this stage, that I give my ruling as regards the true construction and effect of the section.

(2.) It may be stated that the plaintiffs in this suit claim to. be heirs and legal representative of one Harishankar Bagla who according to the plaintiffs died intestate at Cawnpore on or about August 16, 1959. The deceased Harishankar was a partner in defendants No. 5 firm of Messrs. Agarwal and Co. That partnership was at all material times managing agent of defendants No. 6, "The India United Mills Ltd.".

(3.) The question that is raised in this suit relates to the change that occurred in the constitution of defendant No. 5 s firm by reason of the death of Harishankar and as to the results which follow in consequence of such change by reason of the provisions of s. 346. The relevant parts of s. 346 run as follows:-"...where the managing agent of a public company...is a firm...and any change takes place in the constitution of the firm...the managing agent shall cease to act as such on the expiry of six months from the date on which the change takes place or such further time as the Central Government may (whether before or after the expiry of the six months) allow in that behalf, unless the approval of the Central Government has been accorded before such expiry to the changed constitution of the firm...".