Indian Kanoon - Search engine for Indian Law

3. The respondent/Company through its counter has denied the claim of the petitioner. O.P. Jalan, and R.K. Jalan are the sons of S.K. Jalan. They constituted a joint Hindu family with two more sons of S.K. Jalan. The petitioner, is the son of O.P. Jalan. This joint Hindu family had 2/3rd share in Deccan Enterprises P. Ltd. (for short 'Deccan', Deccan Polymer Ltd. (for short, 'Polymer'), respondent/Company Nucon Industries Pvt. Ltd. (for short, 'Nucon') and 20 per cent equity/stroke in Amintit Rubber Industries Ltd. (for short, 'ARIL'). This joint Hindu family also got 67 per cent share in the partnership firm named and styled as the Secunderabad Commercial Company (for short, 'SCC'). These private limited Companies and the partnership firm were floated by R.K. Jalan and one R. Khemka whose family had 33 per cent in Deccan, Nucon, Polymer and SCC. The father of the petitioner, namely O.P. Jalan, was appointed Managing Director of Deccan on 1-2-1969. He was also appointed Managing Director of Nucon. He was looking after the affairs of SCC. He worked in that capacity till 14-12-1984. Thereafter, R.K. Jalan had become the Managing Director of these Companies.. The said O.P. Jalan had badly mismanaged the affairs of the Companies due to which it was put to heavy losses. He had borrowed substantial amounts from Andhra Bank and had given an undertaking to it on 26-6-1991 not to withdraw the unsecured loans worth Rs.32 lakhs from Nucon. Similar undertaking was given in the year 1983. On 12-10-1981, the petitioner, Vikas Trust was appointed as the selling agents of Nucon for a period of 5 years and Vikas Trust had deposited a sum of Rs.6 lakhs with Nucon which had agreed to pay interest at the rate of 10 per cent per annum to Vikas Trust. Later, Vikas Trust had agreed that no interest would be paid in future by Nucon to any one of the selling agents after the month of March, 1983. The petitioner, Vikas Trust, was liable to bear the proportionate losses which had been incurred by Nucon during the period of subsistence of the agreement of Agency that is from 12-10-1981 to 11-10-1987. The respondent/Nucon had lent large sums of money to the applicant Vikas Tnist and as on 1-3-1988, a sum of Rs.2,09,052.71 was due to Vikas Trust. SCC had also advanced money from time to time to Vikas Trust and as on 20-10-1984, Vikas Trust was liable to pay Rs.2,68,000/- to SCC. There is an agreement for arbitration in the event of dispute between Vikas Trust and the respondent/Nucon Company. It is also alleged that besides S. K. Jalan. there are two more trustees. The sum of Rs.6 lakhs represent the contribution of O.P. Jalan to make up the losses incurred by Nucon. Vikas Trust did not procure a single order to boost the sales and marketing of Nucon as a result of which Nucon has suffered losses. The loss is to be adjusted against the sum of Rs.6 lakhs of Vikas Trust. It is lastly alleged that the application has been filed with ulterior motives and the financial condition of Nucon is not at all alarming. It is making profits.

7. On the other hand, it has been contended on behalf of the respondent/Nucon that there is evidence on record which shows that Deccan, Nucon - the respondent/Company, and Polymer had been floated by the joint Hindu family consisting of S.P. Jalan and his two sons, namely Q.P. Jalan - father of the petitioner, and R.N. Jalan, Managing Director of Nucon as also two other sons. SCC is also the property of the said joint Hindu family. Vikas Trust was also a joint family business. O.P. Jalan being the Managing Director of the said Companies, was incharge of the affairs of all the Companies and the firm SCC, and used to make entries in the books of accounts of and on as desired by him and he was also responsible for the losses caused to the Companies and, therefore, until the accounts arc finalised, it cannot be said that Vikas Tmst is entitled for any amount from the respondent/ Nucon. It has also been contended that Vikas Tmst had actually no funds to advance to the respondent/Nucon because there is no evidence on record that Vikas Trust had sufficient funds to make the security deposit of Rs.6 lakhs on 12-10-1981. It has also been contended that Vikas Tmst was liable to pay Rs.2:09,052.71 to the rcspondcnt/Nucon and Rs.2,99,359.85 to SCC. Similarly Subhkarcm Omprakash, a joint Hindu family of which the applicant is a member, is indebted to SCC in the sum of Rs.3,02,001.15 and these amounts are liable to be adjusted against the alleged deposit of Rs.6 lakhs. Under these circumstances, a bona fide case has been set up by the respondent/Nucon and, therefore, the application for winding up ttie Company cannot be admitted. It lias further been contended by the learned Counsel of the rcspondcnt/Nucon that the application is not maintainable because the other two trustees of Vikas Trust were not impleadcd in the application in contravention of Section 48 of the Tmst Act. It has been lastly contended on behalf of the respondent/ Nucon that as per the Trust Deed, Smt. Kavita Jalan had equal share with the applicant in the Trust property and without joining her the petition is not maintainable under Section 45 of the Contract Act.

17. Vikas Jalan, PW1, has testified that his sister Kavita Jalan had become major on 15-5-1985. This witness had become major on 2-6-1988. Thus, as per the terms of Clause 5 of the trust deed, Vikas Trust stood dissolved on 2-6-1988. Kavita Jalan was entitled to claim her half share in the trust property on attaining her majority, that is to say on 15-5-1985.

18. Learned Counsel of the respondent/ Company has argued on the strength of Section 48 of the Trust Act, 1942 (for short, 'the Trust Act'}, that there were three trustees of Vikas Trust, therefore, one of the trustees, namely S.K. Jalan alone had no right to file this application for winding up the respondent/ Company. The other two trustees were necessary parties to the application. Even assuming that they had not agreed to file the application, the remedy of S. K. Jalan was to make them as co-respondents so that all the parties should have been on record for proper adjudication of the dispute. Reliance has been placed on the case of Vedakannu Nadar & Others v. Nanguneri Taluk Singikulam Annadana Chatram and others, AIR 1938 Madras 9S2, Ramesh Chandra Roy v. Hemendra Kiunar Roy, AIR (36) 1949. Calcutta 519, H. E. H. The Nizam's Jewellery Trust, AIR 1980 SC 17 and Dull Chand v. M/s. Mahabir Pershad Trilok Chand Charitable Trust, AIR 1984 Delhi 145. It has also been argued that under Section. 45 of the Contract Act, the co-promisees should join hands for action for promise breaker and if one of the joint promisees docs not join hands with the other one, he should be made as a co-defendant so that the necessary and proper parties should be on record. A single person cannot sue for the other joint promisees. AH the living joint promisees must be joined in a suit to enforce a debt due to them. Because Kavita Jalan has not been made a party either as the applicant or as the respondent, the application for winding up deserves to be dismissed, because, Vikas Jalan is alone not entitled to take action against the respondent/ Company on the strength of the claim of Rs.6,00,000/- for which amount Kavita Jalan was also entitled to.

20. As noted above, the trust was dissolved during the pendency of these proceedings on 2-6-1988 and Vikas Jalan has been substituted in the place of the Trust. This subsequent event cannot be lost sight of. Vikas Man has stated in his evidence that the share of Kavita John had been paid to her after she had attained majority. Therefore, it is only he who is entitled to claim the remaining properties of Vikas Trust including the claim made in this application. He has not furnished any documentary evidence on record in support of his say. He has also not examined Kavita Jalan to corroborate his testimony. If 50 per cent of share of Kavita Jalan has been discharged on her attaining the majority, it cannot be said that the application is bad for non-joinder of Kavita Jalan, on the strength of Section 45 of the Contract Act. No issue had been framed regarding the maintainability for non-joinder of the co-trustees and the nonjoinder of Kavita Jalan, It was not specifically pleaded by the rcspondent/Nucon that the application is not maintainable because co-trustees were not made parties to the application. Though it has been stated that there are other two trustees, the effect of not joining them has not been categorically pleaded. Similarly, there is no pleading that the application is bad for non-joinder of Kavita Jalan. Under these circumstances, it appears that Vikas Jalan had no occasion to file and prove documents evidencing payment of the share to Kavita Jalan on her attaining majority as also to examine her in an attempt to corroborate his statement. The effect of not joining the trustees in the light of the dissolution of the Trust on 2-6-1988 is also a serious question to be decided.