In support of these appeals, two principal companytentions were urged on behalf of the Union The permission granted by the Bombay Stock Exchange after the expiry of seven weeks violated the provisions of s. 73 1 of the Companies Act, 1956 and was on that account invalid and 2 that grant of permission by one out of the three Exchanges did number protect the allotment of shares from being invalid under s. 73 1 of the Companies Act, 1956.
The order passed against the Union and the two Exchanges were in substance distinct.
Against the Union the order was made quashing its order in appeal against the orders of the Exchanges and against the Exchanges the order was made directing inclusion of the shares in the list of quoted shares.
CI/70 6 66 said, companyld only direct that the applications be companysidered by the two Exchanges.
Appeals from the judgment and order dated July 24, 1970, of the Delhi High Court in Letters Patent Appeals Nos.
Rangarajan, J., it was L436 Sup.
Me Exchanges acquiesced in the direction.
On July 27, 1965, the Calcutta Stock Exchange granted time for companypliance till the end of the seventh week from the date of the closing of the subscription list.
2 in A. No.
time for companysideration of the application till the expiry of seven weeks from the date of closing of the subscription list and requested the Company to furnish certain particulars to facilitate companypliance with s. 73 of the Indian Companies Act, 1956.
The High Court companyfirmed the orders of Rangarajan, J. With certificate granted by the High Court, the Union of India has appealed to this Court.
1772 of 1970 .
72 and 73 of 1969.
On June 22, 1965, the Bombay Stock Exchange extended the.
CIVIL APPELLATE JURISDICTION Civil Appeals Nos.
K. Daphtary and S. K. Dholakia, for intervener No.
Regulation Act 42 of 1956, and s. 73 of the Companies Act, 1956, ultra vires the Constitution of India.
The two Exchanges acquiesced in the orders passed against them.
On September 13, 1965.
K. Daphtary and 1.
100 each, and intimating that applications are being made to Bombay, Calcutta and Delhi Stock Exchanges for permission to deal in for official quotations of the shares of the Company.
The learned Judge quashed the order of the Central Government and directed that writs of mandamus do issue against the Calcutta and Delhi Stock Exchanges requiring them to enlist the shares of the, Company.
By another letter dated August 9, 1965, the Exchange informed the Company that the matter of enlistment of shares was under companysideration, and the Company will be intimated of the decision of the Exchange as soon as it is taken.
Rangarajan, I was of the opinion that grant of permission by the Bombay Stock Exchange was valid, and that allotment of shares did number become void, merely because one out of the three Exchanges alone gave the permission to enlist the Companys shares.
In the orders recording dismissal it was recited that the Exchange did number grant the permission for the shares to be enlisted before the expiry of four weeks from the date of closing of the subscription list as required by s. 7 3 1 of the Companies Act, 1956, and that the Exchange did number numberify any extension of time for the grant of the permission within four weeks.
Santosh Chatterjee, C. M. Oberoi and J. Dadachanji, for intervener No.
The Company challenged the orders passed by the Calcutta and Delhi Stock Exchanges rejecting the applications for enlistment, in separate appeals under s. 22 of the Securities Contracts Regulations Act 42 of 1956.
On June 9, 1965, the Calcutta Stock Exchange called upon the Company to modify certain Articles of Association, and by letter dated July 12, 1965, asked for particulars in respect of specified matters.
The Delhi Stock Exchange informed the Company on July 10, 1965, that in order to facilitate companypliance with the provi sions of s. 73 of the Companies Act, the allotment of shares should be finalised as soon as possible in companysultation with the Stock Exchange.
K. Daphtary, S. P. Nayar, for the appellant in both the appeals .
the Exchange informed the Company that it had companysidered and approved the application for enlisting its shares.
2 in C.A. No.
On November 5, 1965, the Calcutta Stock Exchange rejected the application of the Company for enlisting the shares.
A. Palkhivala, Santosh Chatterjee, G. S. Chatterjee and M. Parikh, for respondent No.
1772 and 1773 of 1970.
N. Kirpal and Bishamber Lal, for respondent No.
10 each and 10,000 cumulative preference shares of Rs.
The Judgment of the Court was delivered by Shah, J. On May 29, 1965, the Allied International Products Ltd hereinafter called the Company issued a prospectus offering to the public for subscription 5,00,000 equity shares of Rs.
Sen and O. P. Khaitan, for respondent No.
The Central Government dismissed the appeals.
On August 6, 1965, the Exchange informed the Company that the application was receiving further companysideration and requested that certain formalities be companyplied with.
Against the decision of Rangarajan, J., the Union of India appealed to a Division Bench of the High Court of Delhi.
The Delhi Stock Exchange by letter, dated December 4, 1965, rejected the application of the Company for enlistment of its shares.
C. Setalvad.,
The Company then moved petitions id the High Court of Delhi for the issue of writs quashing the orders passed by the Central Government in appeals under s. 22 of the Securities Contracts Regulation Act, and the orders of the Stock Exchanges rejecting the application of the Company as void, illegal and of numbereffect, and for orders directing the Stock Exchanges to grant enlistment of the shares of the Company, and further declaring s. 22 of the Securities Contracts.
A. Palkhivala, Bhuvanesh Kumari, Santosh Chatterjee, J. B. Dadachanji, for intervener No.
N. Shroff, for intervener No.
On June 3, 1965, the Company submitted applications to the Stock Exchanges at Bombay, Calcutta and Delhi which are recognised Stock Exchanges within the meaning of S. 2 39 of the Companies Act, 1956 , for enlisting its shares.
1773 of 1970 .
1 in both the appeals .
N. Sinha and Rathin Das, for intervener No.
The subscription list of the Company was closed on June 21, 1965.
