JUDGMENT

Ameer Ali, J. - The defendant company was formed as long ago as 1874 with a capital of eight lakhs divided approximately into 800 shares. Since that date, it has had its ups and downs, but it has spun and woven. It has made its profits. It has turned out goods, and no doubt if its management would devote its attention more exclusively to spinning and weaving it would be a flourishing industrial concern. Among the downs, may be mentioned the winding up petition of 1930, which ultimately resulted in borrowing some 70 lakhs upon debentures. In 1931 largely I gather as the result of the need for finance managing agents were obtained in the shape of the Jhajharia and Dhandhania families, who combining into the unit of Morarji Goculdas & Co., became for a period the managing agents. If I recollect rightly, the Jhajharias became selling agents under an agreement, the term of which was 20 years. The managing agents under their agreement became liable for advances to the extent of 20 lakhs in two stages. These advances were secured by the company by hypothecating its stock and by depositing debentures of a certain aggregate value. The actual management of the company was carried on