Broad construction of company affairs under section 165 supports mandatory inspection and mandamus where statutory duty is refused.

Section 165 of the Companies Act, 1948 was construed as mandatory once the statutory preconditions were met, and "the affairs of the company" was given a broad, natural meaning covering business affairs, assets, investments, goodwill and transactions affecting future trading prospects. Acts of a receiver and manager appointed under a debenture did not cease to be matters of the company's affairs, including management decisions affecting a subsidiary and sub-subsidiary. Where the public authority declined to appoint inspectors despite that duty, mandamus remained available because the suggested procedure was not an equally convenient alternative remedy.

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Issues: (i) whether, on a special resolution under section 165 of the Companies Act, 1948, the Board of Trade was bound to appoint inspectors to investigate matters arising from the acts of a receiver and manager appointed under a debenture, and whether those acts could be treated as "the affairs of the company"; (ii) whether mandamus was available in the presence of an alleged alternative remedy.

Issue (i): whether, on a special resolution under section 165 of the Companies Act, 1948, the Board of Trade was bound to appoint inspectors to investigate matters arising from the acts of a receiver and manager appointed under a debenture, and whether those acts could be treated as "the affairs of the company".

Analysis: Section 165 was construed as mandatory where the statutory preconditions are satisfied. The expression "the affairs of the company" was held to bear a broad and natural meaning, extending to the company's business affairs, assets, investments, shareholding interests and transactions affecting its future trading prospects and goodwill. The appointment of a receiver and manager did not divest the company of those affairs. Acts done by the receiver in managing the undertaking, including the use of voting power in a subsidiary and the consequential transactions affecting a sub-subsidiary, could still be matters of the parent company's affairs. The statutory scheme also supported a wide construction of the investigative power.

Conclusion: The acts in question fell within the company's affairs and the Board of Trade was under a duty to appoint inspectors. This issue was decided in favour of the petitioner.

Issue (ii): whether mandamus was available in the presence of an alleged alternative remedy.

Analysis: The suggested procedure was not treated as an equally convenient alternative remedy capable of displacing relief by mandamus in the circumstances of the case.

Conclusion: Mandamus was held to be appropriate and available. This issue was decided in favour of the petitioner.

Final Conclusion: The refusal to appoint inspectors was overturned in substance, and the company succeeded in obtaining the public law remedy compelling performance of the statutory duty.

Ratio Decidendi: Where a company by special resolution invokes section 165, the phrase "the affairs of the company" includes transactions and consequences of a receiver and manager acting under a debenture when those transactions materially affect the company's business, assets, goodwill or corporate interests, and mandamus lies to compel performance of the resulting mandatory duty.

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