MCLEOD AND CO Vs. S K GANGULLY

JUDGEMENT

(1.) The Craig Jute Mills Ltd. (hereinafter referred to as " the company ") was incorporated in 1918 under the Indian Companies Act, 1913. The authorised share capital of the company was originally Rs. 60,00,000 divided into 50,000 preference shares of Rs. 100 each and 3,00,000 ordinary shares of Rs. 10 each. Subsequently, in 1928, the ordinary share capital of the company was reduced to Rs. 7,50,000 divided into 3,00,000 ordinary shares of Rs. 2-8-0. The company's capital was further reduced in 1940 by reducing the face value of the preference shares from Rs. 100 each to Rs. 50 each and by further reducing the face value of the ordinary shares from Rs. 2-8-0 to annas 8 each.

(2.) The object for which the company was formed was to carry on the business of spinners, weavers, manufacturers, bailers and pressers of jute, jute cuttings, jute rejections, hemp, cotton, etc. After incorporation, the company commenced its business of manufacturing jute goods and also dealt in raw jute and jute goods of various kinds and carried on such business till March, 1943. In that year the company's mills were requisitioned by the Government of India. The company at that time had a mill known as Craig Jute Mills situated at Jagatdal, Barrackpore, in the District of 24 Parganas. The company was a lessee under different landlords in respect of the lands on which the mill was situated and other adjoining lands of a total area of 72.09 acres of land.

(3.) At all material times Mcleod & Co. Ltd. (appellant No. 1) was the managing agent of the company and also the managing agent of another jute company known as Alliance Jute Mills Co. Ltd., which was in occupation of adjoining lands comprising an area of 72.09 acres.