S BHAGAT SINGH Vs. PIAR BUS SERVICE LTD

JUDGEMENT

(1.) This is a petition under Section 38 of the Indian Companies Act, 1913, which is analogous to Section 155 of the Companies Act of 1956. There are two petitioners. The first petitioner Bhagat Singh claimed to have 41 shares of Rs. 100/- each in the "Piar Bus Service Limited, Amritsar. This amount, he claimed to have paid by giving to the Company two motor lorries of the value of Rs. 4,100/- and he claims himself to be a holder of fully paid up shares.

(2.) The second petitioner is Hardev Singh who had acquired 100 shares of the Company of the value of Rs. 100/- each and had paid the entire amount of Rs. 10,000/- on these shares. The grievance of the two petitioners is that their respective shares were illegally forfeited by the Company and they were transferred to respondents Nos. 2 to 4 and their names have been scored out from the register of members of the Company. They have prayed that this Court should pass an order directing the respondent-Company to enter the names of the petitioners in the register of members and to remove the names of respondents Nos. 2 to 4.

(3.) On behalf of the Company it is denied that the first petitioner Bhagat Singh was a holder of 41 shares. According to the Company ho owned only 24 shares of Rs. 100/- each and these shares were fully paid up. As regards petitioner No. 2 the extent of his holding has been admitted and it is stated that he joined the service of the Company as a cashier and was entrusted from time to time with large sums of money. On checking his account it was found that on 19-4-1941 according to the books of the Company there was a sum of Rs. 23,994/10/9 as cash in hand. The next day the cash in hand was found to be Rs. 4/4/9. Hardev Singh stopped working after 19-4-1941, and the above mentioned amount was due from him to the Company as also shown in the balance sheet. The Company had a lien on the shares of Hardev Singh for the amount due from him. As he did not pay this amount his shares were forfeited by a resolution of the Directors passed at a Board meeting held on 22-9-1953 (vide Exhibit R. 4) and this resolution was later confirmed on 20-10-1953, at a general meeting of the share-holders of the Company. He was present at the meeting of the share-holders.