1966 (3) TMI 35

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....up capital of the company is Rs. 90,000. The main object of the company is to carry on work of mechanical and constructional railway and electric engineers. Under its articles of association the company is to have no directors and its business is to be conducted by the members who are to exercise all the powers and functions of the directors. There were originally three members each with 30 shares. Each member is to have one vote and the quorum at all meetings is two members present personally. Under the articles Profulla Kumar Dutta, the eldest of the three brothers, who are members of the company, was competent to sign in the name of the company, to receive moneys, cheques, etc., on behalf of the company and in short was to exercise all t....

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..... (c)Pranay Kumar who was in the employ of the company and used to draw salary from it has not been paid his salary for a long time past with the object of squeezing him out of the company. (d)Profulla Kumar Dutta purported to transfer the registered office of the company without the knowledge or consent of Pranay Kumar Dutta. Profulla has also managed to defraud the other brother, Subol, dishonestly of the shares held by him. (e)The company being a family concern and the members thereof having lost confidence in each other it will be a just and proper case to wind it up. The petition of Pranay was admitted by the learned company judge on February 17, 1965, and notice of presentation of the petition was directed to be published ....

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.... of the case... . But the parties seem to be determined not to compose their differences. In such circumstances, I do not see how I can help making an order in the usual form for the winding up of the company. Consequently, the present stay petition must be dismissed with costs." Before allowing the learned counsel to go into the merits of the case at length, we indicated that we must be satisfied that the order was an appealable one and we asked the learned counsel for the respondent to argue the preliminary point first. The Companies Act does not contain any provision for staying of all proceedings when a petition for winding up is presented. The courts have inherent power to prevent the abuse of its process and if a court takes the....

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.... newspaper fourteen days before the hearing." The question was examined at greater length in the case of (1) The Company v. Rameswar Singh [1919] 23 CWN 844, where Sanderson C.J. took the view after considering certain English decisions that if the petition was not bona fide and there was an ulterior object behind its presentation, the court might restrain the petitioner from proceeding. The position was again examined by Bachawat J. in (2) In re Bharat v Vegetable Products Limited [1952] 22 Comp. Cas. 62 , where his Lordship, after referring to the judgment of Macleod J., said "I have no doubt that the court has also the power instead of admitting the petition ex parte to direct service of notice on the company and to decide in the p....

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....e right or liability. Refusal to stay does not fulfil the test laid down in Tuljaram Row v. Alagappa Chettiar [1910] ILR 35 Mad. 1, where it was said by White C. J. that if the effect of the order is to put an end to the suit or proceedings so far as the court before which it is pending is concerned or if its effect, if not complied with, is to put an end to the suit or proceeding, it is a judgment within the meaning of the clause. The learned Chief Justice also said that an adjudication on an application which is nothing more than a step towards obtaining a final adjudication in the suit is not a judgment within the meaning of the Letters Patent. In my view the order of refusal to stay is nothing more than a step towards obtaining a final ....