TaxTMI 
TaxTMI 
1977 (5) TMI 89
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....is held by their mother, Smt. Shama Khanna, the third respondent. The Board consists, besides the three shareholders, of Smt. Kamla Rathour, 2nd respondent the sister of the two brothers who has, however, no shareholding. 2. One of the questions in controversy between the parties is as to whether the continuance of the sister as a Director of the Company during the lost over 10 years was valid the contention of the petitioner being that she was appointed as an ad hoc Director some 14 years back and ceased to be a Director on the expiry of the term for which she was appointed, the rival contention of the respondents being that she was appointed a permanent Director and has continued to hold that office in that capacity throughout. The Company owns valuable Immovable property and, inter alia, has controlling interests in Shama Forge Co. Ltd., (for short, Shama Forge). Shama Forge which was an Ifci aided unit had some financial difficulty some time back leading to proceedings against it at the instance of the Ifci under the provisions of the Industrial Finance Corporation Act in course of which a Receiver was appointed of the assets and property of the Company forming subject-matte....
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....used by him for his personal business with the connivance of the other brother and the sister. 3. B. K. Khanna, the petitioner has invoked the provisions of Ss. 397/398 for a number of directions so as to obtain a declaration that the sister ceased to be a Director since 1963, to restrain her from -acting as a Director and from intermeddling with the affairs of the company, to obtain refunds from her of the moneys received by her by way of salary, to restrain the fifth respondent from carrying on business in the company's premises, to restrain the first, second and the fifth respondents from using or permitting the me of any part of the company's premises for purposes other than those of the business of the company. to determine the state of the mind of the mother to appoint an Administrator or an additional Director as Chairman of the company, to restrain any transfer of shares held by his mother, to direct the first respondent to co-operate in-facilitating the sale of the company's interests in Shama Forge and in settlement of outstanding tax matters of the company. The petition is grounded on the allegations that since the middle of 1975 the mother has not been ab....
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....s opposed on the ground that the third respondent was capable of protecting her interest and it was Therefore unnecessary to appoint any guardian-ad-litem. for the said respondent for the purpose of the present proceeding&. The (Application was apparently beard at considerable length by D. K. Kapur, J. and by an order made on October 11, 1976 the learned Judge postponed the decision on the application. In the course of a detailed order Kapur, J. observed that the question whether the third respondent was Incapable of protecting her interests by virtue of unsoundness of mind and mental infirmity "has great importance in respect of the deadlock between the two brothers" and that "in any case, the question of the unsoundness of mind of respondent 3 is a major question to be decided in the petition itself. The learned Judge, Therefore, felt that even though ordinarily in the face of the allegation in the application the Court would ordinarily hold a preliminary enquiry with regard to the state of mind of the said respondent before taking lip the consideration of the petition) such a course would be "somewhat unfair and impracticable" in view of the fact that the question of the state o....
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.... urge the preliminary objection, before the consideration of the question of the state of mind of the third respondent as to the maintainability of the petition. The parties, Therefore, addressed elaborate arguments on the question as to the maintainability of the petition subject, however, to the objection that in view of the aforesaid order of the learned Judge, as indeed, in the face of the provision of O. 32, the Court could not take up the consideration of the petition except to the limited extent indicated above until the question of proper representation of the third respondent had been decided. 8. Two questions, Therefore, arise for consideration at this stage: (1) Whether the preliminary objection with regard to the maintainability of the petition could be considered before determining either in preliminary enquiry or in a composite enquiry, as envisaged by the order of the learned Judge state of the mind of the third respondent; (2) If so, whether the petition is maintainable? 9. After hearing learned counsel for the parties it appears to me that the first question must be answered in the negative and, in view of that, the consideration of the seco....
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....oks the later part of the Rule which envisages the case of "persons who though not so adjudged are found by the Court on inquiry... ... ... to be incapable of protecting their interests when suing or being sued". A prior adjudication with regard to the state of mind of a person is, Therefore, not necessary for the court to invoke the provision of R. 15 of O. 32. 12. The further contention urged on behalf of some of the respondents is that, in any event, this Court was not the forum for the determination of the state of mind of the third respondent said to be incapable of protecting her interest, and that such a question could only be agitated in a court competent to administer the Indian Lunacy Act. Counsel was unable to point to any provision of any statute which may vest in any court or authority an exclusive jurisdiction to determine such questions. On the contrary, the language of Rule 15 leaves no manner of doubt that every court, which is seized of proceedings in which there is a person who is said to be incapable of protecting her interests in relation to the proceedings. has the necessary power, as indeed a duty, to hold a preliminary inquiry to find if such a person was....