Meeting under section 153(1) denied where proposed arrangement is not bona fide or capable of curing winding up defects.

Section 153(1) permits a company, any creditor or member, and the liquidator to apply for an order convening a meeting; competence is not confined to the liquidator. The court required that any proposed arrangement must be bona fide and capable of remedying the defects that produced a just and equitable winding up. On the facts the proposal would not cure majority domination and oppressive conduct, the exclusion of an office holder and voting changes were ineffective, the shareholder register was incomplete, the principal licence asset was short term, and liabilities were substantial; an earlier identical application was dismissed. The meeting order was refused and the petition rejected with costs.

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Issues: Whether a meeting of the members should be ordered under section 153(1) (section 192 of the Travancore Companies' Act corresponding provision) to consider a proposed arrangement for continuance of a company already ordered to be wound up by the court.

Analysis: The application procedure under section 153(1) permits the company, any creditor or member, and where the company is being wound up, the liquidator, to apply for a meeting; this construction does not restrict competence to the liquidator alone. Substantive consideration requires that the proposed arrangement offer a genuine and effective remedy to the defects that led to winding up. On the facts, the company had been wound up as just and equitable; the alleged arrangement would not cure the fundamental domination and oppressive conduct of the majority, the proposed exclusion of an office-holder was ineffectual, the change in voting procedure would not prevent majority control, the shareholder register was incomplete with many unascertained members, the licence term (a principal asset) was short and diminishing, and there were substantial liabilities requiring sale of assets. An earlier identical application had been finally dismissed. Taken together, the proposal was not bona fide, not substantial, and its consideration by a meeting was not feasible or justified.

Conclusion: The application for ordering a meeting under section 153(1) is rejected; the proposed arrangement does not merit consideration by a meeting and the petition is rejected with costs.

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