Ruma Pal, J. : In 1933 Dr. N. B. Parulekar and his wife Shanta, started a Newspaper called Sakal. In 1948, Dr. Parulekar and Shanta promoted a company known as M/s. Sakal Papers Pvt. Limited, which is the respondent No.1 and is referred to hereafter as `the company". Dr. Parulekar died in 1973. Shanta died during the pendency of the appeal before this Court. The appeal which is now being prosecuted by the daughter of Dr. Parulekar and Shanta, arises out of proceedings initiated by Shanta and the appellant under Section 155 (as it stood in 1986) of the Companies Act, 1956 (referred to hereafter as `the Act') in the Bombay High Court.

2. The appellant was brought on record as Shanta's only legal heir and representative. As Shanta was alive during the proceedings before the High Court, to avoid unnecessary verbiage, the appellant and Shanta are referred to hereafter as `the appellants'.

3. One of the matters in dispute in this appeal relates to the transfer of 3417 shares in the company belonging to the estate of late Dr. Parulekar by three of the four executors of the will of Dr. Parulekar. The executors named in the will were Shanta, the respondent No. 2, the respondent No. 3 and the respondent No. 4. There is also a challenge to the transfer of 93 shares by the respondent Nos. 3 and 4 in the company. The basis of the claim of the appellant and Shanta with regard to the 3417 and 93 shares was the failure to allow the appellants to exercise their undisputed right of preemption in respect of the shares. The second branch of the appellants' grievance pertains to the issue and allotment of 17,666/- shares of the company. The beneficiary of these transfers/allotments is the respondent No.5 and his group represented by the respondents Nos. 6 to 16 (hereafter referred to collectively as the Pawar Group). According to all the respondents briefly speaking, the appellants were precluded from exercising any right of preemption and had in any event failed to exercise their right of preemption in respect of the 3417 and 93 shares. As far as the issue of 17,666/- shares are concerned it is submitted that it was validly done and the allotment of the shares was duly made to the Pawar group.

4. The learned Single Judge held that the transfer of the 3417 shares was made contrary to the appellants rights of preemption. He also held that the transfers had been made in violation of the provisions of the Section 108 of the Companies Act, 1956 and the Articles of Association of the Company. It was held that the respondent No. 5 and his group were not bonafide purchasers of the shares as they were aware of the preemptive right of the appellants to the shares. On the issue and allotment of 17,666/- shares the Trial Court held that they were invalid. Having effectively held in favour of the appellants on merits, the Trial Court did not set aside the transfer of the 3417 and 93 shares but set aside the transfer of 3417 and 93 shares to the respondent No. 5 and his group conditional upon the appellants depositing a sum or Rs.80,73,000/- in the Court within a period of six weeks. As far as the 17,666/- shares were concerned, it was directed that they should be allotted to such persons or persons at such price as the Board of Directors may decide. The Company was directed to pay back the Pawar group a sum of Rs.17,66,600/- in respect of the 17,666 shares. It was then said that in the event the appellants did not deposit a sum of Rs.79,86,110/- within six weeks the entire petition filed by the appellants would stand dismissed. The appellants filed an appeal from this order in so far as it was made conditional on the deposit of the sum of Rs.79,86,110/-. They also filed an application for extension of time for depositing the amount in terms of the Trial Court's order before the Trial Court. The application was dismissed.

5. In the meanwhile the Appellants filed two suits being CS 225 and 226 of 1988 before the Court in Pune against the respondents se