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Issues: (i) Whether the claim petitions were maintainable and proved against the appellant on the basis of the alleged hire-purchase agreements and ledger entries; (ii) Whether the alleged hire-purchase agreements were valid and enforceable in the absence of authorisation by the appellant's board of directors and in the absence of proof of ownership and delivery of the vehicles by the claimants.
Issue (i): Whether the claim petitions were maintainable and proved against the appellant on the basis of the alleged hire-purchase agreements and ledger entries.
Analysis: The liability was sought to be fastened through book entries and ledger accounts, but those entries were not supported by independent corroborative material such as cash vouchers or corresponding entries in the appellant's books. The evidence led by the claimants did not establish that any amount remained legally due from the appellant on the basis asserted in the petitions.
Conclusion: The claim on the basis of the ledger entries was not proved and could not be enforced against the appellant.
Issue (ii): Whether the alleged hire-purchase agreements were valid and enforceable in the absence of authorisation by the appellant's board of directors and in the absence of proof of ownership and delivery of the vehicles by the claimants.
Analysis: A company acts through its board, and a director has no authority to bind the company unless power is delegated by a proper resolution. No such authorisation was proved for the directors who executed the agreements. Further, the claimants failed to establish that they were the owners of the vehicles or that possession was delivered to the appellant, which are essential elements of a hire-purchase arrangement under section 2(c) of the Hire-Purchase Act, 1972. In the absence of these foundational facts, the agreements could not create a legally enforceable liability.
Conclusion: The alleged hire-purchase agreements were invalid, without consideration, and unenforceable against the appellant.
Final Conclusion: The decrees in favour of the claimants could not stand, and the appellant was not liable on the alleged hire-purchase transactions.
Ratio Decidendi: A company is not bound by a hire-purchase agreement executed by unauthorised directors, and such an agreement is unenforceable where the claimant fails to prove ownership, delivery of goods, and the essential consideration required for a valid hire-purchase transaction.
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