1940 (4) TMI 18

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....Krishnaswami Ayyar and T.S. Krishnaswami Ayyangar for the Respondent. JUDGMENT The question for decision in this Second Appeal is whether the award of the sum of Rs. 1,295 paid as gratuity to the second defendant by the first defendant Bank in pursuance of a resolution of the General Body dated 23rd November 1935 is valid. The learned Judge in the Court below answered the question in the aff....

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....equested to get the sanction of the General Body to the said payment. After the receipt of that letter from the said Registrar, the Board of Management seems to have amended the bye-laws by providing that in cases where the Board comes to the conclusion that an officer will have to be permanently incapacitated, though not supported by a medical certificate, it might pay gratuity. On the strength o....

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....h an amended by-law would be illegal. Therefore, when the General Body passed a resolution sanctioning the said sum of Rs. 1,295 they were simply sanctioning an illegal resolution of the Board of Management. It must therefore be held that the payment was ultra vires. I am not inclined to agree with this contention. It cannot be denied that even though the by-laws did not provide for payment of a g....

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....he General Body must have been apprised that according to the old by-laws, i.e., before they were amended, the payment of gratuity to the ex-secretary was not proper, that objection was taken by the Registrar of Co-operative Societies and that therefore the sanction of the General Body was sought. Considering all these facts, the General Body chose to pass the resolution which it is perfectly comp....