Judgment

K. JAYACHANDRA REDDY, J.- Special leave granted.

2. This appeal arises out of Company Petition No. 39 of 1985 which was dismissed by a learned Single Judge of the Bombay High Court by his order dated February 27, 1987 and an appeal filed against the said order was also dismissed by a Division Bench. The order of the Division Bench is impugned in this appeal.

3. The appellants are the son, widow and married daughter of one late Shri Prabhudas V. Mehta who was holding 100 equity shares of the respondent - Calico Dyeing & Printing Mills Ltd. (Company for short) of the face value of Rs 100 each. Shri Prabhudas V. Mehta died on August 26,1974 without leaving any will. The appellants are the only legal heirs and representatives of Shri Prabhudas Mehta and they filed a company petition for rectification of the register of members of the Company by deleting the name of Shri Prabhudas V. Mehta and substituting in its place the names of the appellants in respect of those 100 shares in the Company bearing Distinctive Nos. 9101 to 9200. Prior to his death the deceased Shri Prabhudas V. Mehta was holding these shares and was working as an employee of the Company. It appears that there were certain disputes between Shri Prabhudas V. Mehta and the Directors of the Company who made efforts to purchase the said shares. The negotiations in this regard could not be completed in view of the sudden death of Shri Prabhudas V. Mehta. It is also alleged that the appellants entered into negotiations for sale of shares which were carried on for several years. Extensive correspondence ensued between the appellants and the Company. However, as no positive reply was forthcoming for the transmission of shares, the appellants sent a letter to the Company on May 28, 1977 for transmission of shares and for the notice of the annual general meeting stating that they were entitled to the same even in the absence of their names being taken on the register of members by virtue of Articles of Association and the provisions of the Companies Act. On June 27, 1977 a reminder was sent to the Company. On July 9, 1977 a reply was given by the Company stating inter alia that the appellants were not entitled to exercise any voting right in any of the meetings of the Company. On September 21, 1977 the then existing Articles of Association were replaced by a new set of Articles of Association wherein new articles were introduced conferring power on the Company to reject any application for transfer or transmission without assigning any reason in that behalf. According to the appellants this was done mainly with an intention of defeating the appellants rights as shareholders-cum-beneficiaries of the said shares. In the month of March 1984 the Company closed down its operations and by arriving at a settlement with the workers retrenched all the workmen obtaining voluntary resignations from them. It is alleged by the appellants that this was done with the motive of making huge profits by the Directors and their related shareholders by disposing of the plants, machinery etc. On or about June 23, 1984 the Company requested the appellants to approach the Company for transmission of shares after obtaining the succession certificate in respect of the estate of the deceased Shri Prabhudas V. Mehta. On August 21, 1984 the appellants received the heirship certificate in which 100 shares were mentioned as one of the assets standing in the name of Shri Prabhudas V. Mehta in the Company. On August 31, 1984 the appellants sent a letter to the Company intimating that heirship certificate-cum-letter of administration has been received by them and therefore the Company should give to them the details about the formalities to be complied with for the purpose of effecting the transmission of the said shares in their favour. On September 16, 1984 since there was no response from the Company a reminder was sent. On September 19, 1984 the Company requested the appellants to send certified t