PREM NATH GANGNEJA Vs. EDWARDGANJ PUBLIC WELFARE ASSOCIATION

JUDGEMENT

(1.) THE petitioner has moved this petition under Sections 397, 398 read with Section 166 of the Companies Act, 1956 (for short "the Act"); for declaring certain acts of the respondents as illegal and to constitute a new managing committee in the election meeting.

(2.) RESPONDENT No. 1 is a public limited company by guarantee under the Act and was registered in the year 1942. The primary object of the company was to acquire, construct, maintain buildings and shops for public use and benefit. The petitioner was duly elected as a member of the managing committee which assumed office on January 3, 1978. The company held annual general meetings till the year 1981 as provided in the memorandum and articles of association of the company. Every year members of the managing committee were appointed. After August 4, 1985, no meeting or annual general meeting was held for electing members of the managing committee. Respondent No. 2 is in control of the affairs of the company. He donated the following sums to the institutions : Rs. " (a) D. A. V. College 2,40,000 (b) Lady hospital 2,97,000 (c) Primary school 1,60,000 (d) Guest house 5,20,000 (e) Contractors 7,92,920 (f) Cremation ground 48,302 (g) D. A. V. Public School 60,000"

(3.) THE petitioner claims that these amounts were, in fact, misappropriated by respondent No. 2. The property of the company was also sold at a nominal value and the sale proceeds were misappropriated. Shops have been rented out on nominal rate of rent. These acts of respondent No. 2 are detrimental to the interest of respondent No. 1.