HUNTER Vs. DAMODAR DAS

JUDGEMENT

(1.) This is an application, dated the 22nd of April, 1924, by Mr. Hunter, the liquidator of the Bank of Upper India, Ltd., to restrain certain respondents named Damodar Das and P.N.S. Aiyar, from acting as liquidators of the Bank of Upper India, Ltd., and to restrain the two said persons and four others, namely, Piare Lal, F.W. Roberts, N.N. Das and Khan Bahadur Wahid-ud-din Saheb, from pretending to be a committee of share-holders or contributories.

(2.) The matter came before a member of this Bench on the 22nd of April. Being obviously a matter of urgency and importance, an interim injunction was then granted and notice was given to the respondents to appear on the 9 of May to show cause why the injunction should not be continued. Appear they did in person, with one exception, by showing themselves in Court, but they remained concealed behind their counsel, Dr. Sen, who showed cause by advancing certain legal arguments. The matter, although urgent and important, is a simple one. The only thing that causes me any surprise or cause for observation is that persons of this kind, professing themselves to be men of business and holding shares in other companies, and some actually having been directors of such companies, should be so lost to all sense of decency and business acumen as to launch an attack of this kind, after seven years, upon a liquidator, by the issue of circulars and the holding of meetings, all of which purported to be done according to law, without a shadow of grievance as far as one can see, or without a shadow of a title in law or equity behind them, and should be content to do so in cold blood, and then to come up to the High Court and make piteous appeals through counsel, first for an adjournment, and secondly for the decision of fancy points of law. As to what the real object of these mysterious proceedings may be and what they hoped to gain, the Court is left entirely in the dark. One can only say that their conduct is that of individuals apparently actuated by a vindictive desire to proceed against some concern or company which they wish to injure. There is some suggestion, which we have not gone into, that they have already taken active measures to injure, or defeat, or delay steps that the liquidator is taking in " accordance with law against some defaulters. Amongst the matters dealt with in the preliminary order was the question of these gentlemen's pecuniary responsibility for their conduct to the liquidator if their conduct proved wrongful, and if any real loss had been suffered. It has been agreed by Mr. O Conor on behalf of the liquidator, Dr. Sen on behalf of Mr. Damodar Das and Mr. Piari Lal and Saiyid Muhammad Husain on behalf of Dr. N. N. Das, K.B. Wahid-ud-din and Mr. Roberts, that the matter of their pecuniary responsibility should stand over for the present to be dealt with either on an original motion before me, or by a suit at law by Mr. Hunter as he may be advised.

(3.) The history which gives rise to the content, if it can be designated by that name, which certainly has occupied a totally disproportionate amount of the time of this Court, begins with the voluntary liquidation of the Bank of Upper India Ltd., in 1917, when, by a resolution of the shareholders in June of that year, Mr. Hunter, and his colleague Mr. Stuart, the Secretary of the Alliance Bank of Simla, Ltd., were appointed joint liquidators. In order to remove any misunderstanding, we may point out that the provisions of the Companies Act are adequate to enable any one, or any body of shareholders or contributories, if they are dissatisfied with any conduct on the pa$ of one or both of the liquidators, to bring the matter before the Judge in winding up. So if there be any controversy, it can be decided, and the liquidator, if necessary, removed, or directed to conduct himself properly. In the event of a liquidator dying, or resigning, provision is made for the members of the company to appoint a successor. Nothing of this kind happened until February, 1924, and, therefore, it must be taken that the present respondents were" perfectly satisfied with the conduct of Mr. Hunter- and his joint liquidator Mr. Stuart, who retired in July, 1923, and that matters so continued from June, 1917, until February, 1924. Indeed, one of these persons, Damodar Das, has been joint liquidator With Mr. Hunter in the Trust of India, Ltd. By an arrangement which was entered into in writing, which Mr. Hunter called an agreement for sale, namely, the document exhibit HH 4, of July, 1917, the Trust of India, Ltd., which seems to have been a sort of roving financial genius exercising control over the Alliance Bank and other companies, took over the assets of the Bank of Upper India. Now the assets of the Bank of Upper India were largely in the form, of mortgages of immovable property, assets which in this country however, healthy they look, undoubtedly take a very long, time to realize and to produce satisfactory results, involving for their realization much persistent litigation the obtaining of decrees, and applications in execution, the length and complexity of which are so familiar and so attractive to the legal profession; and it may be assumed that anybody in possession of 65 lakhs worth of that kind of asset, such as the liquidator of the Bank of Upper India, Ltd. had to realize, might consider himself fortunate if in the course of ten years he realized 50 per cent.