BENGAL BANK LTD. Vs. SURESH CHAKRAVARTTY

JUDGEMENT

(1.) THIS is an appeal from an order made on June 15, 1950, by Bachawat J., refusing to sanction a scheme. The Company in question is the Bengal Bank Ltd. which was incorporated in 1926 under the Indian Companies Act. The petition under Section 153 was first presented to this Court on or about December 9, 1949, on which day preliminary directions under that section were given.

(2.) THE Bank has twenty branches. Five of the branches are in Pakistan and the remaining fifteen are within the State of West Bengal. The authorised capital of the Company is Rs. 25,00,000/ -. The paid up capital is Rs. 11,70,000/ -. It carries on business as a Bank in India as well as in Pakistan. Its registered office and principal place of business is in India. The majority of the depositors are within the Union of India. Notice of the application has not been given to the creditors in Pakistan.

(3.) THE scheme of course is not effective unless it is confirmed by the Court. But before the Court makes an order sanctioning the scheme, it is necessary in the first place to have the scheme or arrangement approved and accepted by the requisite majority and if the scheme is sanctioned by the requisite majority then it is presented to the Court for confirmation. In other words, the Court cannot sanction a scheme until it has been approved by the majority in terms of Section 153 (2) of the Indian Companies Act.