SHRIKISHEN DHOOT Vs. S D KAMLAPURKUR

JUDGEMENT

(1.) Manohar Pershad, J.-O.S. No. 32/1 of 1953-54 out of which this present appeal F.A. No. 2/1 of 1956 on behalf of defendants 1 to 10 arises was instituted by the first respondent herein for recovery of H.S. Rs. 5,975 with interest thereon alleging that he was a member of the Hyderabad Bullion Exchange and paid a membership deposit of H.S. Rs. 1,000 initially and later on he deposited N.G.P. Notes of Rs. 5,000 as membership security deposit. In the month of August, 1947, he left for U.S.A. for higher studies and came back in the year 1950. After his return, he was informed that his security deposit amounts were being refunded by the defendants to the members as the said deposits were no longer required. On 9th June, 1962, he wrote to defendant No. 3, who was the then Chairman of the defendants' company for the refund of his deposit amount. By a circular letter dated 10th June, 1952. the defendants' company informed him that his deposit amount would be returned to him on his intimating 10 'the defendants the amount of deposit due to him by the company. He was also informed that at a General Body meeting of the defendants' company held on 9th June, 1952, a Sub-Committee was formed and appointed the defendants 8 to 10 to go into the accounts of the company and make a report and he was asked to appear before the said sub-committee. He appeared on 28th June, 1952, but the said deposit was not refunded to him. Subsequently, he was informed that in a General Body Meeting of the defendants' company held on 7th August, 1952, it was decided that the security amount due to him should be provided for on the contingent fund and that on repeated demands the defendants' company did not return the said N.G.P. notes to him. He, however, admitted that he received Rs. 500 in the shape of N.G.P. notes in full satisfaction of the original admission fee of Rs. 1,000. The plaintiff has impleaded defendants 2 to 7, the directors of the company ; defendants 8 to 10, the sub-committee members and the subsequent endorsees as parties to the suit. Defendants 2, 3, 5, 6 and 8 to 10 while admitting that the plaintiff made an initial deporit of Rs. 1,000 and subsequently deposited N.G.P. notes of the value of Ps. 5,000 as membership security with the defendant's company, stated that by the order of the Registrar of Joint Stock Companies dated 25th Decemoer, 1949, the first defendant-company was declared defunct. As such, no suit could lie. They further stated that the N.G.P. notes were handed over to one G.S. Alshi on the authority of the plaintiff with an endorsement in his favour who, in turn, re-endorted in favour of G.S. Alshi and by subsequent endorsements the N.G.P. notes were in the possession of the State Bank of Hyderaoad. As such, he had no right to claim them from the defendants. They further denied their liability to pay interest or to rediliver the promissory notes. They, however stated that they were ready to deliver with the endorsement, the promissory note bearug No. 049661 of the face value of Rs. 500 but the plaintiff himself refused to take it. They also pleaded that ths defendants' company had become defunct and dissolved and as such there was no question of defendants 2 to 7 being its directors. They, however, admitted that the assets of the company were in possession of the 2nd defendant. A legal plea was also raised that the Court had no jurisdiction to try the suit as defendants 2, 3, 8, 9 and 10 were not the residents of Secunderabad. Another legal objection was raised that no suit could lie against a dissolved company without the liquidation proceedings in the High Court. The plaintiff filed a rejoinder denying the allegations of the defendants.

(2.) On these averments in the pleadings, the following issues were framed by the trial Court :

(3.) In this appeal, Mr. Jain, the learned Counsel for the appellants, apart from other contentions, contended that the case of the appellants was that, the N.G.P. notes were endorsed in favour of the plaintiff who subsequently endorsed it in favour of the 13th defendant who, in turn, endorsed them in favour of the Hyderabad Bank Ltd. (12th defendant) and subsequently the notes were transferred in favour of the Hyderabad State Bank ; and unless the plaintiff proves that the endorsement alleged to have been made by him in favour of the 13th defendant was a forged one, the plaintiff cannot succeed in this action. He further drew our attention that in spite of this clear statement and the denial by the plaintiff that he made the endorsement in favour of the 13th defendant, the Court below has not framed any issue and has not given any finding on this point and without such a finding, the determination of the liability cannot be effectively made. Sri Sadashiva Rao, the learned Counsel' for the plaintiff, very rightly conceded that the appellants had alleged that the endorsement was made in favour of the plaintiff and that fact has been denied by the plaintiff and no issue has been framed, but contended that evidence has been let in and this Court can consider that evidence. It may, be, as is urged by the learned Counsel for the plaintiff-respondent, that he has led evidence, but as no issue was framed the appellants can rightly contend by saying that they could not produce the evidence.