TMI Blog1949 (3) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... h, firstly, it was resolved that the first call (i.e., the call in respect of the third instalment) made as proposed in the circular letters, Ex. D-2 series, should be confirmed and, secondly, the Managing Directors were authorised to make the second call (i.e., the call in respect of the fourth instalment) before 5th December, 1928, requiring the amount of that call to be paid by 25th December, 1928. It is the case of the defendant company that thereafter, as shown by Exs. D-3 and D-3 ( a ), the blank printed form of the call notice maintained by it and the counterfoil of the notice actually issued, notice was duly sent to the plaintiff in respect of the first call on 30th March, 1928, and that, similarly, as shown by Exs. D-6 and D-6 ( a ), a similar printed form of the call notice and a similar counterfoil respectively, notice was duly sent to the plaintiff in respect of the second call on 4th December, 1928. The plaintiff did not comply with the notices and make the payments. There were further notices, Ex. D-8 series, which also proved fruitless. The company thereupon resolved by Ex. D-9 on 2nd December, 1938, to issue farther notices to defaulting shareholders intimating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive for want of conformity to the same article; (3) that the notices said to have been issued by the company to the plaintiff in respect of the two calls on 30th March, 1928, and 4th December, 1928, were not proved to have been served on the plaintiff or even posted, and that there was no proof, in fact, of how the notices were sent to the plaintiff; (4) that the further notices, Ex. D-8 series, of 1931 and 1932 were defective, in that, while mentioning the total amount as being Rs. 2,500 they did not, as required by Art. 42 of the articles of Association, contain particulars concerning the place at which or the person to whom the amount was to be paid; (5) that the resolutions Exs. D-9 and D-11 ( a ) could not be regarded as resolutions for calls under Art. 40; and (6) that the notices Exs. D-10 and D-12 were defective in the particulars required to be mentioned by Art. 42 in notices for call amounts. On these findings the court below held the forfeiture of shares made by the defendants by Ex. D-17 to be illegal and invalid. It also held that there was no waiver on the part of the plaintiff of his right to complain of the irregularity of proceedings on the part of the defendant. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the printed notice forms were filled up and notices were duly posted. He makes the point which, in our opinion, is not of much substance, that the clerk who is said to have informed D.W. 1 of the despatch of notices has not been examined. Notwithstanding the abstention of the clerk from the witness box, commonsense warrants the presumption, which we are prepared to raise, that the notices were duly posted in the ordinary course of business. Notwithstanding, again, the interested and of course uncorroborated denial by the plaintiff of his receipt of the notices, the common course of human affairs warrants the further presumption, which we are prepared to raise, that the notices were duly received by the plaintiff. His conduct in keeping quiet after his admitted receipt of Ex. D-8 series and Ex. D-10 which he has produced into court, quite apart from his conduct in sending in response to Ex. D-12, the hundi, Ex. D-14, and the sum of Rs. 500 fortifies us in our conclusion that he must have received the prior notices suggested by Exs. D-3 and D-3 ( a ) in regard to the first call and by Exs. D-6 and D-6 ( a ) in regard to the second, which he is apparently suppressing, as, if produced, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... careful consideration that we have bestowed on the matter, agree that the Privy Council decision in Premila Devi y. The Peoples Bank of Northern India Ltd. (in liquidation ) [1939] 9 Comp. Cas. 1 , invalidates the decision of the Divisional Bench of the Bombay High Court rendered by Beaumont, C.J., and Blackwell, J., or contains anything to support the criticism made of it by Lord Williams, J., in the Calcutta case. In the Bombay case Beaumont, C.J., observed at page 425 of the report: "It is true that these matters must be fixed by the Board, because the articles so provide, but I think we must presume that the agents did their duty and took instructions from the Board; otherwise they would not have been justified in signing by order of the Board." At page 428 of the report, Blackwell, J., observes: "I am of the opinion that it is not necessary that the persons to whom, and the place at which, the call is to be paid, should be mention ed in the resolution making the call........." And at page 429, the learned Judge further observes: "......In the absence of any evidence upon the point, the Court is entitled to assume that these notices were sent out by the age ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... go so far, as on broad principle, we consider the Bombay decision sufficiently in point. Turning next to the Calcutta case, we find that what happened there was that Lort Williams, J., held on the facts that the directors had failed to appoint the place at which and person to whom the call was payable, that therefore the resolutions and notices of calls were invalid and that there could be no forfeiture of the shares for non-payment of such calls. The learned Judge sets forth the substance of the decision of the Chief Justice of the Bombay High Court at page 145 in the following words: "With regard to the decision of Sir George Jessel, M.R., in the case of Johnson v. Lyttle's Iron Agency [1877] 5 Ch. D. 687 , the learned Chief Justice seemed to think that his judgment was reversed by the Court of Appeal only upon the ground that the notice for final payment was inaccurate, and therefore the forfeiture founded on the notice was bad. Further, he observed that none of the judges in the Court of Appeal expressed dissent from the views of the Master of the Rolls as to the construction of Table A, except that James, L.J., expressed the tentative view that the time for the payme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... directors or shareholders whether by resolution or ratification or otherwise to alter dates fixed by a sanctioned scheme for calls on unpaid capital. A resolution of directors requiring payment of call on dates at variance with a sanctioned scheme is an attempt to do something ultra vires of the company. A purported forfeiture of shares for non-payment of calls in accordance with such a resolution is inoperative and void and the creditors, in a winding-up, are entitled to have the names of shareholders which have been removed from the register of members by reason of an invalid forfeiture restored." It will be seen from this that there is nothing decided by this case which can be held to conflict with Dhunraj Keshrimal v. H.H. Wadia [1933] ILR 57 Bom. 413 ; but Mr. Venkatesa Aiyangar has contended that there is the following passage of two paragraphs in the judgment of the Privy Council begining at page 18 and running into page 19 which assists his contention: "This may seem to be somewhat technical; but in the matter of the forfeiture of shares, technicalities must be strictly observed. And it is not, as is sometimes apt to be forgotten, merely the person whose sha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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