GOBIND PRITAMDAS MALKANI Vs. AMARENDRA NATH SIRCAR

JUDGEMENT

(1.) A company formerly known as N. C. R. Corporation and since April, 1974, known as M/s. National Cash Registers Co. with limited liability incorporated in the U.S.A., having its registered office at U.S.A., carried on business in India, inter alia, at 4/D, B. B. D. Bag, East Calcutta, within the jurisdiction of this court, at Madras, New Delhi, Bombay and Ahmedabad. The said company hereinafter referred to as "the American company" was carrying on the business of import and marketing in India of various accounting and other machines. The plaintiff, Gobind Pritamdas Malkani, Amarendra Nath Sircar, Keshab Ranjan Chakraborty, Bhabatosh Dey and many others were employed by the said American company. The plaintiff, Govind Pritamdas Malkani, was the manager of the Bombay branch.

(2.) By an agreement in writing dated 16th of February, 1974, executed between the American company and the defendants Nos. 1, 2 and 3, the American company agreed to sell and transfer to the defendants Nos. 1, 2 and 3, the entire business of the American company as a going concern with effect from the 1st of December, 1973, together with all benefits, assets, properties, losses, book debts, liabilities, for the total price of rupees equivalent to 2,00,000 dollars. The salient terms and conditions of the said agreement were first of all that the said transfer would be completed on or before the 1st of June, 1974, after obtaining the consent and approval of the Reserve Bank of India under the provisions of the Foreign Exchange Regulation Act, secondly, the vendee shall take over and retain in its employment all the staff, employees, workmen and other personnel employed by the American company at various places in India, on the same terms and conditions of their services as they were with the American company, thirdly, the Indian company will allow the employees to participate in the share capital of the company to the extent of 15 per cent.

(3.) On the 16th of May, 1974, the defendants Nos. 1, 2 and 3 caused the defendant No. 4, i.e., Cash Register Co. India Private Ltd., to be incorporated under the Companies Act, 1956, hereinafter referred to as "the Indian Co.". Under the articles of association of the company, the first directors of the said company are the defendants Nos. 1, 2 and 3 for their lives or until one of them voluntarily retires because of personal reasons. None of the said first directors are liable to retire by rotation. The other material articles for the determination of the dispute between the parties at this stage are :