V NARASIMHA AIYANGAR, OFFICIAL LIQUIDATOR OF THE CITY HYGIENIC MILK SUPPLY CO LTD Vs. OFFICIAL ASSIGNEE OF MADRAS REPRESENTING DSADASIVA RAO, AN INSOLVENT

JUDGEMENT

(1.) This is an appeal against an order of our brother Beasley, J., as he then was, dismissing an application of the Official Liquidator of the City Hygienic Milk Supply Co., Ltd., under Section 235 of the Indian Companies Act for an order compelling the Directors of the Company to pay certain amounts by way of compensation in respect of their acts of misfeasance, etc. Two points were raised before the learned Judge and both were decided against the applicant. The Official Liquidator appeals.

(2.) In appeal the two points that arise are: (1) . Whether Directors of Companies under the Indian Companies Act are trustees for the purpose of Section 10 of the Limitation Act; and (2) if they are not trustees, from what date does limitation run.

(3.) Taking up the first point, it is now clear that, even in England in spite of occasional use of loose expressions to the contrary, it is now settled that Directors of - Companies are not trustees. In In re Forest of Dean Coal Mining Company (1878) 10 Ch.D. 450, Jessel, M.R., said at page 451: Directors have sometimes been called trustees, or commercial trustees, and sometimes they have been called managing partners. and at page 453: They are no doubt trustees of assets which have come into their hands, or which are under their control but they are not trustees of a debt due to the company.