TaxTMI 
TaxTMI 
1916 (9) TMI 1
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....er, and the learned District Judge has decided against the applicant, who consequently brings the present appeal. 2. The learned Advocate General takes a preliminary point that under Section 38 of the Act the appeal is not competent. The objection is put in two ways. First, it is said that the proviso, which occurs at the end of the section, must be confined to the third clause of the section. Mr. Jardine admits that upon this point we have to guide us nothing but the framing of the section and the setting in which the proviso is placed. It appears to me that these circumstances constitute too slight and uncertain a ground for the inference which is sought, and I am of opinion, following the decision in Amrito, Lal Ghose v. Shrish Chunder Chowdhry I.L.R. (1899) Cal. 944 that the proviso should not be confined to the last clause of the section, but must be read as a general reservation imposed on all the clauses. 3. Secondly, it was contended that the appeal does not lie because the conditions under which alone an appeal is granted under this section are not in this case satisfied. Now the conditions precedent to the existence of an appeal are that the lower Court should have ....
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....haser, But after all the argument which we have heard from Mr. Thakor, I am unable to see in what respect his position is materially altered or improved by the circumstance that he purchased at a Court-sale. It may be that when the Directors refuse to approve a transfer after a Court-sale in execution, there may ensue inconveniences in practice. But similar inconveniences will also ensue when a private purchaser's transfer is refused to be accepted by the Directors acting within the limits of their discretion. For the purposes of this argument, we must, of course, assume that the Directors would be within their powers in refusing to register the present appellant, if he were a private purchaser, and not a Court-purchaser. Upon that assumption, I can see no reason why the Directors' powers should be curtailed merely because the appellant purchased at a Court-sale. For whether the sale is made by a private individual or by a Court, it seems to me clear that the thing sold and transferred from the seller to the buyer is merely the property in the share plus a limited, not an absolute, right to have the transfer registered. But the appellant here contends, and must contend, tha....
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....o the last sub-section. The corresponding proviso to Section 58 of the Indian Companies Act of 1882 has been held to be applicable to the whole section in Amrita Lal Ghose v. Shrisk Chunder Chowdhry I.L.R. (1899) Cal. 944; and it seems to me that the position of the proviso with reference to the subsections in the new Act is all the more favourable to this construction. Besides, I am unable to appreciate the significance of this contention in this particular case, as under Sub-section (3) the Court " generally may decide any question necessary or expedient to be decided for the rectification of register". It is not possible to suggest that the question decided by the lower Court was not necessary for the rectification of register. 8. The second ground is based upon the suggestion that in this case the Court has not directed any issue to be tried. It is apparently true that there is no such express direction. Having regard, however, to the procedure which is usually followed in applications under this section, it seems to me that though there was no express direction for the trial of the issue arising in this application, it was necessarily involved in the consideration of the ap....
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....nd relieved of its corresponding obligations, to deal with a transfer application, when the transfer is sought in virtue of a Court-sale. Mr. Thakor has relied upon Rule 79 of Order XXI of the Code of Civil Procedure in support of his argument. Under that rule after the Court-sale, both the judgment-debtor and the company are prevented from transferring the shares and from receiving any dividend from, or paying it to, any person except the purchaser; and it is urged that if the company can be prevented from transferring the shares or paying the dividend to any body except the purchaser, it must involve the result that the purchaser should be accepted as the transferee or else the company would be able to keep the benefit of the shares to itself. I do not think that the provisions of the rule involve any such result. Even though under the rule a company may be prevented from transferring the shares or paying the dividend to any person except the purchaser, it does not follow that the purchaser at a Court, sale is in any worse position than a private purchaser from a share-holder, whom the Directors have refused to accept as a proper transferee in the exercise of their powers under t....