TMI Blog1971 (11) TMI 109X X X X Extracts X X X X X X X X Extracts X X X X ..... n the register of members of the said respondent at present, in the name of G.H. Dupret (respondent No. 2) and they bear numbers 0031 to 10,081. Ordinarily, since both the petitions were for rectification of the register of members of the respondent-company in respect of identical shares, there should have been only one petition, but it appears that since the validity of the allotment with regard to those shares was challenged on different grounds, the petitioner, which is also a company, filed two petitions. It may also be mentioned here that before these petitions were filed, the petitioner had also filed on April 15, 1965, Petition No. 5 of 1965, under sections 397 and 398 of the Act and that petition was admitted by the Companies Tribunal, New Delhi, on the same day. In that petition, Shri R.D. Bhagat, the chairman of the petitioner-company, had also joined as a petitioner. In Petition No. 29 of 1965, which was the number of the original petition filed before the Tribunal, the contention of the petitioner was that 10,051 equity shares were originally allotted to respondent No. 2, G.H. Dupret, at the board meeting of the respondent-company held on March 25, 1963. Shri Dupret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner has now come up in appeal against the same. Learned counsel for the petitioner, who will hereafter be referred to as the appellant, does not dispute that it is a summary and discretionary jurisdiction which is exercised by the Tribunal in such matters. We, therefore, do not see what fault can be found with the order in that view of the matter. It was, however, contended by the learned counsel for the appellant that the only issue that had been raised in the petition which has given rise to F.A.O. 10 of 1966, was whether the initial allotment of 10,051 shares in favour of Dupret, the foreign collaborator, was erroneous because machinery that was obtained by the respondent-company in consideration of this allotment was a worthless machinery. In support of this contention, our attention was drawn to the survey report (annexure "C" to the petition) dated 26th November, 1965, by one Mr. H.P. Von Friedlein, a German engineer in Delhi, which was submitted at the request Mr. R.D. Bhagat, the chairman of the petitioner-company. That report showed that the said consultant engineer made a survey of the equipment of paper coating plant on November 26, 1965, which was lying at a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. Counsel for the appellant argued that the section gives unlimited jurisdiction to the court to rectify the register. In all cases where justice requires, the order to rectify will be nunc pro tune (see In re Sussex Brick Company [1904] 1 Ch. 598 (C. A.) and In re Imperial Chemical Industries Ltd. [1936] 2 All E.R. 463 (Ch. D.)). In Smt. Soma Vati Devi Chand v. Krishna Sugar Mills Ltd. A.I.R. 1966 Punj. 44, H. R. Khanna J. (as his Lordship then was) observed that: "Although the power conferred by the section on courts is very wide, the law seems to be well-settled that the remedy provided by the section is summary. It can be invoked in non-controversial matters requiring quick decision. Section 155 is not meant to be used for deciding disputes requiring investigation. In the case of a dispute of complicated nature involving controversy under several heads and necessitating a regular investigation, the section ought not to be allowed to be used and the party concerned should be directed to proceed by way of a regular suit". Reference was made by the learned judge to the following decisions : In re Greater Britain Products Development Corporation Ltd. [192 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the collaboration agreement and was violative of the condition imposed by the Central Government while approving the collaboration agreement and giving consent to the issue of capital under the Capital Issues Control Act, 1947. The said allotment being in contravention of section 3 of the said Act is punishable under section 13 thereof and is as such void ab initio and invalid, and, therefore, rectification of the register of members should be ordered. The Tribunal acceded to the appellant's submission that this petition raises a pure question of law and, therefore, called for its admission. Article 2 of the collaboration agreement dated 10th November, 1961, of which a copy was annexed to the petition, showed that it was proposed to issue paid-up capital of the value of Rs. 30 lakhs and Dupret would be allotted shares of the value of Rs. 10 lakhs in lieu of the machinery and plant to be imported as detailed in article 1. Shri R. D. Bhagat and his nominee were to contribute 5 lakhs in the paid-up capital and the rest of the issued capital would be sold in open market. This agreement was entered into in November, 1961, and the machinery from the foreign collaborator was receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upret for consideration other than cash, i.e. , against supply of plant and machinery and the balance to be issued for cash at par". It appears that two changes were introduced in the original consent by this letter. The consent of the Central Government of June 14, 1962, was for the offer of shares not exceeding 49 per cent, of 30,000 equity shares to Messrs. Leonard Bierman, S. A. Belgium. The amendment contemplated that the offer should be made to Shri G. H. Dupret, respondent No. 2, who, we were told, is a director of Messrs. Leonard Bierman to whom the offer was to be previously made. Secondly, this offer in the first consent was to be for cash at par whereas under the consent order as modified on October 11, 1962, the consideration for the offer of shares not exceeding 49 per cent, was to be other than cash, i.e. , against supply of plant and machinery. It appears that in pursuance of this amended consent order at the board meeting held on March 23, 1963, where Shri R. D. Bhagat was present, 10,051 shares were allotted to Dupret and a consequent entry was made in the register of members. The contention urged on behalf of the appellant is that the present holding o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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