Judgment

BACHAWAT, J.: One James Henry Wapshare owned several estates incluing Naduvattam in the Nilgiris known as the Ouchterlony Valley Estates, having tea, coffee, cardamom and cinchona plantations. He lived in Naduvattam and Ootacamund with his wife Nellie, daughters Violet and Dorothy and sons James and Edward. In 1927 he formed a limited company known as the Ouchterlony Valley Estates Limited, having a share capital of Rs. 15 Lakhs and conveyed the estates to the company. All the shares of this company, sometimes referred to as the "old company" were held by him and the members of his family. The company borrowed Rs. 10 1/2 lakhs from the Imperial Bank of India against the issue of debentures. The loan was secured by a mortgage of the estates under a debenture trust deed dated May 13, 1927 and was repayable on May, 15, 1937. In default of payment within November 15, 1937 the trustee under the debenture trust deed was authorised to enter into possession of the estates and sell them. By an agreement dated August 16, 1936 Pierce Leslie and Co. Ltd., referred to as the appellant company, was appointed as the secretary of the old company. On April 15, 1937 the old company was served with a notice that in default of payment of the loan within November 15, 1937 the trustee for the debenture holders would take possession of the estates and sell them. On May 18, 1937 James Henry Wapshare died leaving behind him his widow and his sons and daughters. In November 1937 after prolonged negotiations between the Wapshares and the appellant company it was settled that the company would purchase all the estates except Naduvattam for Rs. 10 lakhs. On December 29,1937 formal agreements were executed providing that the old company would convey to the appellant company all the estates except Naduvattam for Rs. 10 1/2 lakhs and the appellant company would convey Naduvattam to Mrs. Nellie Wapshare for Rs. 50,000 and would at the same time advance Rs. 50,000 on the hypothecation of Naduvattam crops. By January 10, 1938 the appellant company paid the entire purchase price and took possession of the estates and the entire dues of the Imperial Bank of India were liquidated. On March 30, 1938 the old company passed a special resolution for its voluntary winding of and appointed Capt. F. Murcutt as its liquidator. The appellant company promoted a new company known as Ouchterlony Valley Estates Ltd., for the purpose of acquiring the estates. The new company was incorporated on September 5, 1938. Fifty percent of its shares were held by the appellant company. Formal conveyances of the Naduvattam estate in favour of Mrs. Nellie Wapshare and of the other estates in favour of the new company were executed by the old company between January and May 1939. On the the execution of the conveyances the new company entered into possession of the estates conveyed to them. As soon as the affairs of the old company were wound up the liquidator made up the final accounts of the winding up and called the final meetings of the company and its creditors. On or about November 29, 1939 a copy of the final accounts and the return of the holding of the meetings were filed with the registrar of joint stock companies and were registered under S. 209 H of the Indian Companies Act, 1913. In view of S. 209 H (4) the old company stood dissolved with effect from March 1, 1940. On December 21, 1950 Mrs. Nellie, Violet, Dorothy James and Edward Wapshares instituted the present suit against the appellant company, impleading the appellant company as defendant No. 1, 12 persons said to be its directors and officials as defendants 2 to 13, Capt. F. A. Murcutt as defendant No. 14, the new company as defendant No. 15 and the old company as defendant No. 16. The plaintiffs prayed for a decree dealing that the old company had not been wound up in accordance with law and was still in existence as a corporate personality, a declaration that the old company was the real owner of the aforesaid