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1970 (9) TMI 61 - SC - Companies LawWhether the exchange was entitled to retain the balance after satisfying the debts, liabilities and engagements of the appellant to the other members or to the exchange? Held that:- If the company is permitted to retain the balance of the amount after satisfying the debts, liabilities and engagements of the shareholder, the transaction would not be different from one purchasing the share of the defaulting shareholder for a value equal to the amount of his obligations. That would be plainly illegal. We are, therefore, unable to agree with the High Court that the exchange was entitled to retain the balance after satisfying the debts, liabilities and engagements of the appellant to the other members or to the exchange. The decree passed by the High Court is set aside and the case remanded to the High Court for determining the extent of the liabilities of the appellant to the exchange not only in respect of the transactions with Johurmull Daga but in respect of all other outstanding liabilities of the appellant to other members of the exchange and to the. exchange which are. enforceable under the articles. The appellant is entitled to receive from the exchange the balance remaining due after deducting the aggregate amount or value of the obligations. He will be entitled to interest on the balance at the rate of 6% per annum from the date of the institution of the suit. Parties will bear their own costs throughout.
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