Membership cap disputes and rectification claims fail where necessary parties are absent and articles cannot override statutory limits.

A rectification petition challenging enrolment beyond the registered membership limit was held not maintainable because the affected members were necessary parties, and a prior settlement of the same dispute without liberty to file fresh proceedings barred the later challenge under the principles reflected in Order 23 Rule 1 CPC. A representative claim also failed because the affected members did not share an identical interest and no proper representative direction had been obtained. The Delhi HC further held that the general committee could not enlarge membership beyond 1,500: for a company limited by guarantee, any increase required alteration of the articles by special resolution and compliance with statutory notice requirements, and any contrary article was void to that extent.

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Issues: (i) Whether the rectification petition was maintainable in the absence of the members whose names were sought to be removed, and whether the earlier settlement and order in the connected suit barred the present proceedings; (ii) Whether the general committee had power under the articles to increase the number of members beyond the registered strength of 1,500.

Issue (i): Whether the rectification petition was maintainable in the absence of the members whose names were sought to be removed, and whether the earlier settlement and order in the connected suit barred the present proceedings.

Analysis: The same challenge to enrolment beyond 1,500 had been raised in the earlier suit, which was settled without any leave to bring fresh proceedings on the same issue. The petitioner was bound by the compromise recorded in that suit, and the later petition on the same matter was hit by the principles underlying Order 23 Rule 1 of the Code of Civil Procedure, 1908. The persons whose names were sought to be deleted were directly affected by any rectification of the register and were necessary parties. The attempted resort to a representative capacity did not satisfy Order 1 Rule 8 of the Code of Civil Procedure, 1908, because the affected members did not share an identical interest and there was no proper court direction appointing anyone to defend on their behalf.

Conclusion: The petition was not maintainable and failed against the petitioner.

Issue (ii): Whether the general committee had power under the articles to increase the number of members beyond the registered strength of 1,500.

Analysis: For a company limited by guarantee, the articles must state the number with which the company is registered. Any increase in that number requires alteration of the articles by special resolution and compliance with the statutory notice requirements. The articles could not confer on the general committee a power inconsistent with the Act, because the Act prevails over the articles and any contrary provision is void. The board or committee may implement membership enrolment within the lawful limit fixed by the company, but it cannot itself enlarge the registered membership strength.

Conclusion: The general committee had no power to increase the membership beyond 1,500, and the contrary clause in the articles was void to that extent.

Final Conclusion: The petition was barred on maintainability grounds, though the Court also declared that the general committee lacked authority to enlarge the registered membership strength under the articles.

Ratio Decidendi: A rectification petition affecting membership cannot proceed without impleading the persons whose rights are directly affected, and a company's articles cannot authorise an internal body to increase the registered number of members contrary to the statutory requirement of alteration by special resolution and compliance with the Act.

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