Rectification of Register: court ordered conditional entry of members subject to deposit, declaratory claims refused.

Rectification of the register was ordered conditionally: the court held that instalments were not presently due where the memorandum and articles did not make them immediately payable and the demand rested on resolutions of an invalidly constituted managing board, so no debt enabling forfeiture existed; the applicants' names must be entered provided each deposits the prescribed qualification sums into court by the date fixed. Separate declaratory relief seeking continuation as directors and voiding post January 26, 1936 actions was not entertained and is refused.

---

---

Issues: (i) Whether the register of members should be rectified to include the applicants' names; (ii) Whether the court should grant the declarations sought that the applicants remain directors and that actions after 26 January 1936 are void.

Issue (i): Whether the register of members should be rectified by entering the applicants' names.

Analysis: The Court examined whether sums demanded from the applicants were presently due such that non-payment rendered their shares forfeitable, considering the memorandum and articles, the conduct and validity of resolutions of the managing directors, and statutory requirements for commencement of business. The Court found no specific provision in the memorandum or articles making the application/allotment percentages immediately due on the signatories; the purported demand arose from a resolution of a managing directors' board that was invalidly constituted (four members where five were required). Section 21(2) did not render the sums presently due merely by subscription; section 103 requires payment before commencement of business but does not itself create an immediate demand enabling forfeiture. The Court exercised discretion over rectification in light of the Registrar's certificate of commencement and directed a conditional remedy.

Conclusion: The sums of Rs. 2,000 (and hence the aggregate Rs. 4,000) were not presently due and the shares were not liable to forfeiture; the register shall be rectified by entering the applicants' names on condition that each deposits Rs. 4,000 in Court by the date fixed.

Issue (ii): Whether the Court should grant declarations that the applicants remain directors and that actions after 26 January 1936 are void.

Analysis: The Court noted limits on its power to grant the declaratory reliefs sought and observed that the application insofar as it sought declarations was not maintainable before the Court in the terms presented; accordingly those parts were not entertained for substantive relief.

Conclusion: The application insofar as it seeks declarations that the applicants continue as directors and that post-26 January 1936 actions are void is rejected.

Final Conclusion: The Court granted conditional equitable relief by ordering rectification of the register of members in favour of the applicants subject to payment into court of the sums required for qualification; separate declaratory relief sought was refused.

Ratio Decidendi: Where subscriptions do not, by the memorandum or articles, render specified instalments immediately payable, and where demands are based on resolutions of an invalidly constituted managing board, no presently due debt arises enabling forfeiture; the court may in its discretion order rectification of the register subject to payment into court of the qualification sums.

---