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1970 (9) TMI 55 - SUPREME COURT
Whether the directors acted in the interest of the company?
Whether they acted on a wrong principle?
Whether they acted with an oblique motive or for a collateral purpose?
Held that:- The discretion of the directors is to be tested as the opinion of fair and sensible men in the interest of the company. In the present case, the directors did not act bona fide nor did they act in the general interest of the company. On the contrary, they acted upon a wrong principle and for the oblique motive of squeezing out Firodia. The in scapable conclusion is that the directors acted arbitrarily and unjustifiably.