Subscriber liability in winding up survives non-allotment, promoter fraud claims, and invalid surrender of shares.

A subscriber to a company's memorandum becomes bound on incorporation to take the shares entered against his name, and liability as a contributory in winding up is not avoided by the absence of formal allotment. Allegations of fraud or misrepresentation by promoters may affect separate rights between the parties, but they do not defeat the statutory obligation to contribute. A purported surrender of uncalled shares is ineffective where it would amount to an unlawful reduction of capital unless supported by a recognised statutory basis such as forfeiture. The signatories who had not been validly released from that obligation remained liable as contributories.

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Issues: Whether the signatories to the memorandum of association were liable to be entered as contributories notwithstanding pleas of fraud, misrepresentation, non-allotment of shares, repudiation of liability, and withdrawal of consent to act as directors.

Analysis: A subscriber to the memorandum becomes bound on incorporation to take the shares entered against his name, and the absence of a formal allotment does not discharge that obligation. Liability as a contributor in winding up is not avoided by alleging fraud or misrepresentation against the promoters, because such pleas may affect inter se rights but do not defeat the statutory obligation to contribute. A surrender of uncalled shares which would reduce capital is not valid unless supported by a recognised statutory basis such as forfeiture. The signatories here were not past members and could not escape liability by their own default in relation to allotment or by asserting that they had ceased to act as directors.

Conclusion: The signatories to the memorandum were liable as contributories and their names were directed to be entered in the list of contributories.

Ratio Decidendi: A subscriber to a company's memorandum remains liable for the shares opposite his name in winding up, and that liability cannot be defeated by non-allotment, alleged fraud by promoters, or an invalid surrender of shares that would amount to an unlawful reduction of capital.

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