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IN THE HIGH COURT OF ALLAHABAD
Ghulam Hasan, J.
DEPUTY COMMISSIONER OF PARTABGARH - Appellant
Versus
THE UNIVERSAL FILM CO.(INDIA) LTD. - Respondents
Second Appeal 329 Of 1945
Decided On : 04/10/1950
COURT OF WARDS ACT - SECTION 17 - NOTIFICATION OF CLAIMS - PROOF OF CLAIM - SECONDARY EVIDENCE - REQUIREMENTS - U. P. COURT OF WARDS ACT, SECTION 17.
Fact of the Case:
The plaintiff, a limited liability company, sued the defendant, the Deputy Commissioner of Pratapgarh in charge of the Court of Wards, to recover a sum of money due from Rai Krishna Pal Singh, a director of the company and a taluqdar of Birapur, for shares purchased by him. The defendant contended that the suit was not maintainable as the plaintiff had failed to notify its claim under Section 17 of the U. P. Court of Wards Act.
Finding of the Court:
The court held that the plaintiff had failed to prove that it had notified its claim under Section 17 of the U. P. Court of Wards Act. The court found that the original of the letter sent by the plaintiff to the Deputy Commissioner, which was alleged to be a notification of the claim, was not properly proved. The court also found that other documents relied upon by the plaintiff, such as a letter sent by the liquidator to the Deputy Commissioner and a list of contributories, did not constitute a valid notification of the claim.
Issues: 1. Whether the plaintiff had notified its claim under Section 17 of the U. P. Court of Wards Act? 2. Whether the original of the letter sent by the plaintiff to the Deputy Commissioner, which was alleged to be a notification of the claim, was properly proved?
Ratio Decidendi: The court held that Section 17 of the U. P. Court of Wards Act requires a person having a claim against a ward to notify the claim to the Collector within six months from the date of publication of a notice inviting claims. The court further held that the notification of the claim must be in writing and must be accompanied by full particulars of the claim and all documents on which the claimant relies in support of the claim. The court found that the plaintiff had failed to comply with these requirements and therefore its claim was not valid.
Final Decision: The court dismissed the plaintiff's appeal and allowed the defendant's appeal. The suit of the plaintiff was dismissed with costs to the defendant throughout.
( 1 ) THESE are two connected appeals arising out of a suit for recovery of rupees 1280-13-4 brought by the respondent against the appellant.
( 2 ) THE plaintiff is a limited liability Company called the Universal Film Company Limited, lucknow. It went into voluntary liquidation on 13th December 1941, and Mr. Kashi Prasad, advocate, was appointed liquidator. Rai Krishna Pal Singh, the taluqdar of Birapur, who is now represented by the Deputy-Commissioner of Pratapgarh in charge of the Court of Wards, purchased 100 shares of the Company at RS. 10 each share for a sum of Rs. 1000. These shares were allotted to him on 25th November 1936. Rai Krishna Pal Singh paid Rs. 250 upon allotment and he was still liable to pay the balance of Rs. 750 according to the Company. Rai krishna Pal Singh was a director of this Company also at one time. He did not pay the sum due from him, whereupon, the Company brought a suit for recovery of, that amount plus Rs. 513-13-4 as interest at 12 per cent. per annum according to Article 25 of the Memorandum and articles of Association (Ex. 5 ). The total sum claimed was Rs. 1280-134.
( 3 ) THE defence with which we are concerned in the present appeal was that the notification under section 9, Court of Wards Act was issued against Rai Krishna Pal Singh on 21st October 1939, and his estate was taken over by the Court of Wards on 23rd May 1941 under Section 8 (1) (d) (iii) and (iv), U. P. Court of Wards Act. A notification inviting claims under Section 17 of the act was published in the U. P. Gazette on 21st June 1941 (EX. 3) but the Company did not notify their claim as required by that section, hence the suit was not maintainable. The other defence was that the suit was barred by three years rule of limitation and the company was in any case not entitled to charge any interest as after liquidation Article 25 of the Articles of association had lost its force and the rights of the parties are governed by the Indian Companies act which does not provide for any interest to be charged by the Company.
( 4 ) THE trial Court held that the Company did notify its claim, that the last call for rupees 250 made on 1st May 1938 was within time but the rest of the claim was beyond time. Interest at the rate of 12 per cent. was allowed on the last call. In the result the suit was decreed for Rs. 250 plus interest, that is to say for Rs. 65.
( 5 ) THE plaintiff and the defendant were both aggrieved by this decree and while the defendant filed an appeal the plaintiff field cross-objections. The lower appellate Court, however, upheld the decree of the trial Court. Both parties being dissatisfied with that decree have filed second appeals. Second Civil Appeal No. 329 of 1915 is filed by the defendant whereas Second Civil appeal No. 398 of 1945 is filed by the plaintiff.
( 6 ) IN the defendants appeal three main points which were decided by the Courts below against the defendant were pressed. These relate to the ratification of the claim under Section 17, U. P. Court of Wards Act, limitation and interest embodied in issues Nos. 5, 6 and 3 respectively. The plea regarding the giving of a notice as prescribed by Section 54, U. P. Court of Wards Act embodied in issue No. 4 was not pressed.
( 7 ) UNDER issue No. 5 the trial Court held on the basis of the original of Ex. 26 sent by Bhairon prasad acting as liquidator to the defendant that it amounted to the filing of a claim under section 17, Court of Wards Act. The trial Court further held under issue No. 5 (a) that the company honestly believed that the claim had been filed before the Court of Wards, but if this belief turned out to be wrong, then the Company must be deemed to hive been prevented by sufficient reason from filing it. These findings were challenged is grounds Nos. 5 and 6 of the memorandum of appeal to the lower appellate Court, but the lower appellate Court says : "there ware certain other grounds taken in defence about the failure of the plainti
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