LexRAJAHMUNDRY ELECTRIC SUPPLY CORPORATION LTD. versus A. NAGESWARA RAO AND OTHERS.
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1955 K.C.MaJ/itw and oth.trs v. The State of T ravancore-Cochin Bolt J. 1955 Decembtr 16. 1066 SUPREME CO:URT REPORTS (1955] but when it allowed the appeal by the State and passed the lesser sentence it said that "the sentences passed on each accused will run con~rrently". We are not sure whether the learned Judges meant that the sentences imposed by ihem should run concur- rently with the others or whether they meant to allow the appeal to that extent. In order to remove all doubts, we allow the appeal to the extent of direct- ing that the sentences imposed on each accused shall run concurrently and not consecutively. Except for that, the appeal is dismissed. RAJAHMUNDRY ELECTRIC SUPPLY CORPORATION LTD. ti. A. NAGESWARA RAO AND OTHERS. [VIVIAN BosE and VENKATARAMA AYYAR JJ.] Indian Companies Act, 1913 (Vil of 1913), s. 153-C sub-clause (J)(a)(i) and s. 162(v) and (vi)-Application for an order under s. 153-C-Validity t!tereof to be judged Oil the facts at the time of presentation thereof-Subsequent events-Effects thereof-Order under s. 153-C-Whether competent before facts proved make out a case for u1inding up under s. 162-Wordsi "just and equitable" in s. 162(vi) -Whether ejusdem generis with the matters mentionned in clauses (i) to (v) of the section--Mere misconduct of Directors in misappropriat. ing funds of a Company-Apart from other circumstances-Whether warrants an order for the winding up of a Company-CircumstanceJ under which an order for winding up can be passed by the court. An application was filed by the first respondent under s. 162 clauses (v) and (vi) of the Indian Companies Act for the winding up of the Company on the grounds, inter-alia, that the affairs of the Con1pany were being mismanaged and that the directors had mis- appropriated the funds of the Company. In the alternative it was prayed that action might be taken under s. 153-C and appropriate orders be passed to protect the interests of the shareholders. The High Court held (i) that the charges set out in the application had been substantially prove~ and that it was a fit case for an order for winding up being made under s. 162 (vi) and (ii) that under the circumstances action could be taken under s. 153-C and accordingly it appointed two administrators with all the powers of directors to look after the affairs of the Company. On appeal by special leave to the Supreme Court by the Company it was contended that the 2S.C.R. SUPREME COURT REPORTS 1067 application under s. 153-C was not maintainable inasmuch as there was no proof that the applicant had obtained the consent of requisite number of shareholders as provided in sub-clause (3)(a)(i) to s. 153-C, that clause providing that a member applying for relief must obtain the consent in writing of not less than one hundred members of the Company or not less than one-tenth of the members of the Company whichever is less.. It was alleged that thirteen members who had given their consent to the filing of the application had sub- sequently withdrawn their consent. Held, that the validity of a petition must be judged on the facts as they vv· ere at the time of its presentation, and a petition which was valid when presente<l cannot, in the absence of a provision to th:n effect in the statute, cease to be maintainable by reason of events subsequent to its presentation. The withdrawal of consent by thirteen of the members, even if true, could not affect either the right of the applicant to proceed with the application or the juris- diction of the court to dispose of it on its own merits. Held further that before taking action under s. 153-C the court must be satisfied that circumstances exist on which an order for winding up could be made under s. 162 and where therefore the facts proved do 10ot make out a case for winding up under s. 162, no order can be passed under s. 153-C. The words "just and equitable" in s. 162( vi) are not to be con- strued ejusdem generis with the matters mentioned ia clauses (i) to ( v) of the section. If there is merely a misconduct of the directors in misappro- priating the funds of the Company an order for winding up would not be just and equitable but if in addition to such misconduct, cir- cumstances exist which render it desirable in the interests of the shareholders that the Company should be wound up, s. 162( vi) would be no bar to the jurisdiction of
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