MOOL CHAND WAHI Vs. NATIONAL PAINTS P LTD

JUDGEMENT

(1.) THIS is a petition under Sections 433, 434 and 439 of the Companies Act, 1956, (hereinafter called "the Act" ).

(2.) BRIEFLY, the facts are that respondent No. 1 is a private limited company and respondent No. 2 is its director in-charge. The petitioner, it is alleged, was the managing director and shareholder of respondent No. 1 in the year 1970. It is further alleged that as per the account books for the year 1971, an amount of more than one lakh rupees stood to the credit of L. R. Wahi and Co. , a proprietorship concern of the petitioner, which amount has now swelled to more than four lakh rupees. A registered notice was sent by him to respondent No. 2 asking him to make payment of four lakh rupees, Later, another notice dated dated January 9, 1980, under Section 434 of the Act was sent through his counsel requesting the respondents to make payment of Rs. 4,20,000. However, the company has not paid the amount. Consequently, it is prayed that the company be ordered to be wound up.

(3.) THE respondents have contested the petition and, inter alia, pleaded that the petitioner at no point of time was the managing director of the company. It was resolved by the company on August 15, 1960, that the petitioner would supervise the company under the control of the board of directors and he would be paid a monthly salary of Rs. 1,000, with effect from August 16, 1960, subject to the confirmation by the shareholders of the company. Respondent No. 2, however, would carry on as a manager and technical director on the remuneration already drawn by him. It is alleged that the shareholders of the company did not confirm the resolution regarding payment of a monthly salary of Rs. 1,000 to him. The company had been crediting the personal account of the petitioner with Rs. 1,000 p. m. The credit towards salary was transferred from his personal account to the account of L. R. Wahi and Co. , in which account some money of the petitioner lay already deposited. Thus, in the balance-sheet for the year 1970-71, the company showed an unsecured loan of Rs. 1,03,455. 23 from L. R. Wahi and Co. Later, when it was pointed out in the meeting of the board of directors that there was no provision about the payment of the salary to Mr. M. C. Wahi after August 31, 1960, and so the amount already paid to him from September 1, 1960, onwards was recovered from him.