Judgement

MAHAJAN J. The dispute in this appeal is between a constituent and a firm of stock brokers. Some time before April 1936 the plaintiff, then a young man, came into possession of property worth about 2 lakhs of rupees on a partition between him and his brothers. In the hope of getting rich by obtaining quick dividends by speculating on the stock exchange he through the defendant firm and certain other stock-holders entered into a series of speculative transactions and it seems he did not fare badly in the beginning. But subsequent events tell a different tale.

2. In 1937, two iron and steel companies in North India, viz., Indian Iron and Steel Co. Ltd., and the Bengal Iron and Steel co. Ltd., merged into one concern and a new issue of shares was made. The scheme was that for every five shares which a person held in the Indian Iron Co. Ltd. on 22-4-1937 one fully paid-up share would be given to him at a price of Rs. 25. The market price at the time this scheme was announced was about Rs. 55 per share. A wave of speculation followed this announcement and there was a boom in the market. Prices of Indian Iron shares were going up to unreal heights. To stabililize the situation th