Satyanarayana Rao, J.-This appeal relates to a dispute between two rival groups of shareholders of Kaleeswarar Mills, Ltd., Coimbatore, each attempting to obtain control over the management of the company. For this purpose, these two factions have engaged themselves in a battle of wits for a long time with the result that the business of the company has been seriously affected. For the purpose of this appeal, it is not necessary to advert to the incessant quarrels between the two groups since 1931. It would be sufficient to start from 1948. The two factions are led by Sathappa Chettiar on the one hand who represents the plaintiffs group and A.L.A.R. family consisting of three brothers of whom the eldest, Kalairaja Chettiar is the leader. The annual meeting of the company which is the first defendant in the case, for the year ending 1947, was held on 30th September, 1948. The agenda paper for that meeting contained four subjects:

1. To receive and adopt the directors’ report and the audited profit and loss account for the year ended 31st December, 1947, and the audited balance sheet as at 31st December, 1947;

2. To elect directors in the place of the two directors who retired by rotation;

3. To appoint an auditor or auditors and to fix his or their remuneration;

4. To approve the co-option of Messrs. P.K. Palaniappa Gounder and A. L. A. R. Arunachalam Chettiar.

The company was incorporated under the Indian Companies Act, 1882, in or about 1906. Its main object was to manufacture cotton goods. Among the signatories to the memorandum of association are included the legal luminaries of the Madras Bar at the time, viz., Sri V. Bhashyam Aiyangar, P.R. Sundaram Aiyar, V. Krishnaswami Aiyar and S. Srinivasa Ayyangar besides business magnates. The Articles of Association of the company excluded the application of Table A in the first schedule to the Indian Companies Act; but the regulations framed were modelled more or less on the regulations contained in Table A. The capital of the company, which then consisted of nine lakhs of rupees, was divided into 9,000 shares of Rs. 100 each. Sathappa Chettiar’s group owned in 1948 as many as 3,450 shares while the A. L. A. R, group owned only 2,300 shares. Before the general body meeting of September, 1948, however, the A. L. A. R. group increased their voting capacity by splitting their share3 and transferring single shares to various individuals. About 450 single shares were registered with that end in view in the name of 450 individuals who wore not members before.

The proceedings of the meeting of the 30th September, 1948 (Exhibit A-2 in A.S. No, 29 of 1949) show that Palaniappa Gounder, the present fifth defendant, who was the chairman of the Board of Directors entitled to preside at every general meeting under Article 78, presided at that meeting and disposed of the various objections raised at that meeting. Before the subjects on the agenda were considered, objection was taken on behalf of A. L. A. R. group that proxies filed on behalf of the plaintiffs’ group were not valid as they were not given particularly for that meeting but they were general in language. The objection was answered on behalf of the plaintiffs’ group by Mr. Lakshmanan, the present second plaintiff stating that the proxies were intended only for that meeting which was made clear from the date given in the proxies. On this the chairman ruled that the proxies were valid. Mr. Lakshmanan also seems to have objected to the validity of about 49 revocations of proxies filed by the opponents but the chairman overruled that objection. The most important objection that had to be considered however raised by the second plaintiff was that shareholders owning less than five hares were not entitled to vote in view of Article 88 which provided that every shareholder not disqualified shall have one vote in respect of every five shares. After due consideration, the chairman overruled this objection. The subjects which were on the agenda we

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