HANSRAJ GUPTA Vs. N. P. ASTHANA

JUDGEMENT

(1.) IN this appeal, and in another appeal (No. 86 of 1930), in which the same parties are concerned, the relevant facts cover much common ground, and they were accordingly heard together. Lala Raghu Mal (who will be referred to as the testator) was a shareholder in a company (herein called the company) named the Dehra- Dun Mussoorie Electric Tramway Co., Ltd., which was incorporated under the Companies Act 1913, on 23rd August 1921. He carried on business under the style of Madharam-Hardeo Das at Calcutta and under the style of Madho Ram Bud Singh at Delhi. On 23rd February 1922, he entered into a contract in writing with the company (modified in some respects at a later date) by which he agreed to supply large quantities of tramway construction material to the company. Cl. 16 of the Contract was in the following terms :

(2.) ON the same date a sum of Rs. 27,000 was paid to the testator, and a letter was written to him, signed by one Beltie Shah, as managing agent on behalf of the company, in which it was stated that :

(3.) SOME correspondence took place later in the year between the parties relative to this sum, but the contract between the parties in relation thereto must, their Lordships think, be sought only in the documents of 23rd February 1922. On 12th August 1922, a conversation took place between the testator and Beltia Shah, as a result of which the testator signed or authorized the signature on his behalf of two forms (dated 12th August 1922) applying for further shares in the company. By one form he applied for 10,000 ordinary shares of Rs.10 each, by the other he applied for 250 preference shares of Rs.100 each. It will be sufficient to set out the terms of the application form for the ordinary shares. It was addressed to the directors of the company and ran thus: