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THE JOINT-STOCK COMPANIES

THE JOINT-STOCK COMPANIES
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ARRANGEMENT OF SECTIONS
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Preamble

PART I.

CONSTITUTION AND INCORPORATION OF COMPANIES AND ASSOCIATIONS.
Registry
SECTIONS

I. Company formed by Memorandum of Association and registration. Banking or Insurance Company not to be formed with limited liability.

III. Matters required to be prescribed by Memorandum of Association.
IV. Prohibition against identity of names in registered Companies.

V. Form of Memorandum of Association.

X. Registration of Memorandum of Association and Articles of Association.

XI. Effect of registration.

XII. Directors to be liable for debts if dividend be paid contrary to the provisions of the Act, or when the Company is known by them to be insolvent.

Proviso.
XIII. Issue of shares by Company

XIV. Register of shareholders.
XV. Annual list of shareholders on Register.
XVI. Penalty on Company not keeping a proper Register .

XVII. Restrictive definition shareholder.
XVIII. Transfer of shares.
XIX. Certificate of shares.
XX. Calls a debt to Company.
XXI. Inspection of Register and annual of share holders.

XXII. Power to close Register.
XXIII. Remedy for improper entry, or omission of entry in Register.
XXIV. Register to be evidence.
XXV. Copies of Memorandum and Articles of Association to be forwarded to shareholders.
PART II.

MANGEMENT AND ADMINISTRATION OF COMPANIES.

General.

XXVI. Registered Office of Company.

XXVII. Notice of situation of registered Office XXVIII. Publication of name a limited Company .

XXIX. Penalties on non-publication of name.

XXX. General Meeting of Company. XXXI. What accounts to be kept.
XXXII. Balance-sheet to be made out annually and filed with the Register.
Form of balance-sheet.

XXXIII. Balance-sheet to be signed and certified by the Directors.
XXXIV. No dividend payable except out of profits.

XXXV. Audit.

? Subject to verification and confirmation by the Department.

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SECTIONS
XXXVI. Inspection of balance-sheet and of report of Auditors thereon.
XXXVII. Appointment of Auditors.
XXXVIII. Power of Company to after regulations by special resolution.
XXXIX. Definition of special resolution.
XL. Registry of special resolution.
XLI. Copies of special resolutions.
XLII. Notice to Registrar of increase of capital.
XLIII. Prohibition against carrying on business with less than seven shareholders.
XLIV. Evidence of proceedings at Meetings.
Legal Instruments of Company.
XLV. Contracts how made.
Deeds.
XLVI. Execution of deeds.
XLVII. Promissory Notes, Bills of Exchange, and Hoodees.
Examination of Affairs of Company.
XLVIII. Examination of affairs of Company by Inspectors appointed by the local Government.
XLIX. Power of Inspectors.
L. Result of examination how dealt with.
LI. Power of Company to appoint Inspectors.
LII. Report of Inspectors to be evidence.
Notices.
LIII. Services of notices on Company.
LIV. Rules as to notices by letter.
LV. Authentication of notices of Company.
LVI. Adjudication of offences and recovery of penalties.
Alteration of Forms.
LVII. Governor General of India in Council may alter Forms in Schedule.
PART III.
WINDIG-UP
Preliminary.
LVIII. Application of Part III of Act.
LIX. Meaning of the Expression “the Court” as used in Part III of the Act.
LX. Liability of present shareholders in respect of debts.
LXI. Liability of former shareholders in Company other than a limited Company with
respect to debts.
LXII. Liability of former shareholders in a limited Company with respect to debts and
liabilities.
LXIII. Commencement of winding-up of Company defined.
LXIV. Definition of “contributory,” and legal character of his liability.
LXV. Rights of contributories between themselves.
Winding-up by Court.
LXVI. Circumstances under which Company may be wound-up by Court.
LXVII. Company when deemed unable to pay its debts.
LXVIII. Application for winding-up to be by petition.
LXIX. Course to be pursued by Court on petition of a creditor.
LXX. Order for winding-up Company on creditor’s petition.
LXXI. Course to be pursued by Court on petition of contributory.
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SECTIONS
LXXII. Effect of the order for winding-up Company.
LXXIII. Collection and application of assets.
LXXIV. Fraudulent preference.
LXXV. Power of Court to summon person suspected of having property of Company.
LXXVI. Penalty of falsification of books.
Within three months.
LXXVII. Executions upon certain judgments of petition to be void.
LXXVIII. Books of Company to be evidence.
LXXIX. Power of Court to make calls.
LXXX. Recovery of calls.
LXXXI. Calls may be made upon former shareholders in respect of shares.
LXXXII. Payment of money into Court.
LXXXIII. Power of Court to grant injunction
LXXXIV. Power of Court to stay proceedings.
LXXXV. Power of Court to adjust rights of contributories
LXXXVI. Power of Court to order costs.
Official Liquidators.
LXXXVII. Appointment of Official Liquidators.
LXXXVIII. Style and duties of Official Liquidators.
LXXXIX. Power of Official Liquidators.
XC. Remuneration of Official Liquidators.
XCI. Dissolution of Company.
XCII. Registrar to make minute of dissolution of Company.
Voluntary Winding-up of Company.
XCIII. Circumstances under which Company may be wound-up voluntarily.
XCIV. Notice of resolution to wind-up voluntarily.
XCV. Consequences of voluntary wind-up.
XCVI. Saving of rights of creditors.
PART IV.
Registration.
XCVII. Registration.
PART V.
REPEAL OF FORMER ACT AND TEMPORTY PROVISIONS
Repeal.

XCVIII. Repeal of Act XLIII of 1850.

Temporary Provisions.

XCIX. Registration of existing Companies.

C. Requisitions for registration by existing Companies. CI. Authentication of statements of existing Companies.

CII. Certificate of registration of existing Companies.
CIII. Power of Company to change name.
CIV. Certificate to be evidence of compliance with Act.
CV. Saving rights to creditors.
SCHEDULE.
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THE JOINT-STOCK COMPANIES

ACT NO. 19 OF 1857

[10th July 1857.]

AN ACT for the incorporation and regulation of Joint-Stock Companies and other Associations, either with or without limited liability of the Members thereof.

Preamble.

WHEREAS it is expedient that the law relating to the incorporation and regulation of Joint-Stock Companies and other Associations should be amended, and that the members of Joint-Stock Companies and other Associations should be enabled to limit their liability for the debts and engagements thereof : It is enacted as follows:—

PART I.

CONSTITUTION AND INCORPORATION OF COMPANIES AND ASSOCIATIONS.

Registry.

I. Company formed by Memorandum of Association and registration.—Seven or more persons, associated for any lawful purpose, may, by subscribing their names to a Memorandum of Association, and otherwise complying with the requisitions of this Act in respect of registration, form themselves into an incorporated Company, with or without limited liability.

Banking or Insurance Company not to be formed with limited liability.—Provided that nothing in this Act shall authorise any persons to form themselves into a Joint-Stock Company or Association, with limited liability, for the purpose of Banking or Insurance.

II. Penalty on partnerships exceeding a certain number.—Not more than twenty persons shall after the first day of January 1858 carry on in partnership, in any part of the territories in the possession and under the Government of the East India Company, any trade or business having gain for its object, unless they are registered as a Company under this Act, or are authorised so to carry on business by an Act of Parliament, or by Royal Charter or Letters Patent, or by an Act of the Governor General of India in Council ; and if any persons carry on business in partnership contrary to this provision, every person so acting shall be severally liable for the payment of the whole debts of the partnership, and may be sued for the same ,without tale joinder in the action or suit of any other members of the partnership.

III. Matters required to be prescribed by Memorandum of Association.—The Memorandum of Association shall contain the following things: (that is to say)

(1) The name of the proposed Company;

(2) The part of the said territories in which the registered Office of the Company is to be established;

(3) The objects for which the proposed Company is to be established;

(4) The liability of the shareholders, whether it is to be limited or unlimited;

(5) The amount of the nominal Capital of the proposed Company;

(6) The number of shares into which such Capital is to be divided, and the amount of each share.

In the case of a Company formed with limited liability, and hereinafter called a limited Company, the word “limited” shall be the last word in the name of the Company.

IV. Prohibition against identity of names in registered Companies.—No Company shall be registered under a name identical with that by which a subsisting Company is already registered, or deceive; and if any Company, through inadvertence or otherwise, is registered by a name identical with that by which a subsisting Company is registered, or so nearly resembling the same as to be

calculated to deceive, such first-mentioned Company may, with the sanction of the Registrar, and shall if, if required by him so to do, change its name, and upon such change being made, the Registrar shall enter the new name on the Register in the place on the former name ; but no such alteration of name shall affect any rights or obligations of the Company or of any member thereof, or render defective any legal proceedings instituted or to be instituted by or against the Company, and any legal proceedings may be continued or commenced against the Company by its new name, that might have been continued or commenced against the Company by its former name.

V. Form of Memorandum of Association.—The Memorandum of Association shall be in the form marked A in the Schedule hereto, or as near thereto, as circumstances admit; and it shall, when registered, bind the Company and the shareholders therein to the same extent as if each shareholders had subscribed his name and affixed his seal thereto or otherwise duly executed the same, and there were in such Articles Memorandum contained, on the part of himself, his heirs, executors, administrators, or representatives, a covenant to conform to all the regulations of such Articles, subject to the provisions of this Act.

VI. Share to be taken by subscribers of Memorandum of Association.—Every subscriber of the Memorandum of Association shall take one share at the least in the Company; the number of shares taken by each subscriber shall be set opposite his name in such Memorandum of Association; and upon the incorporation of the Company, he shall be entered in the Register of shareholders hereinafter mentioned as a shareholders to the extent of the shares he has taken.

VII. Special regulations may be prescribed by Articles of Association.—The Memorandum of Association may be accompanied by, or have annexed thereto, or endorsed thereon, Articles of Association signed by the subscribers to the Memorandum of Association, and prescribing regulations for the Company ; but if no such regulations are prescribed or so far as the same do not extent to modify the regulations contained in the Table marked B in the Schedule hereto, such last-mentioned regulations shall, so far as the same are applicable, be deemed to be the regulations of the Company, and shall bind the Company and the shareholders therein to the same extent as if they had been inserted in Articles of association, and such articles had been registered.

VIII. Form and effect of Articles of Association.—The Articles of Association shall be in the form marked C in the Schedule hereto, or as near thereto as circumstances admit; they shall, when registered, bind the Company and the shareholders therein to the same extent as if each shareholder had subscribed his name an affixed his seal thereto or otherwise duly executed the same, and there were in such Articles contained, on the part of himself, his heirs, executors, administrators, or representatives, a covenant to conform to all the regulations of such Articles, subject to the provisions of this Act.

IX. Use of printed copies of Memorandum or Articles.—Any person signing a printed copy of the Memorandum of association, or Articles of Association, shall be deemed to have signed such Memorandum and Articles respectively.

Attestation of execution.—The execution by any person of the Memorandum of Association or Articles of Association shall be attested by one witness at the least.

X. Registration of Memorandum of Association and Articles of Association.—The Memorandum of Association and Articles of Association shall be delivered to the Registrar of Joint-Stock Companies, who shall retain and register the same; there shall be paid to the Registrar of Joint-Stock Companies, in respect of the several matters mentioned in the Table marked D in the Schedule hereto, the several fees therein specified, or such smaller fees as the Governor General of India in Council may from time to time direct; and all fees so paid shall be accounted for to Government.

XI. Effect of registration.—Upon any such Memorandum of Association, either with or without Articles of Association as aforesaid, being registered, the Registrar shall certify under his hand that the Company is incorporated, and, in the case of a limited Company, that the Company is limited; the subscribes of the Memorandum of Association, together with such other persons as may from time to time become shareholders in the Company, shall thereupon be a body corporate by the name prescribed in the Memorandum of Association, having a perpetual succession and a common seal, with

power to hold land, but with such pecuniary liability on the part of the shareholders as is hereinafter mentioned: the certificate of incorporation given by the Registrar shall be conclusive evidence that all the requisitions of this Act in respect of registration have been complied with; and the date of such certificate shall be deemed to be the date of the incorporation of the Company.

XII. Director to be liable for debts if dividend be paid contrary to the provisions of the Act, or when the Company is known by them to be insolvent.—If the Directors of any such company shall declare and pay any dividend contrary to the provisions of this Act or when the Company is known by them to be insolvent, or any dividend the payment of which would, to their knowledge, render it insolvent, they shall be jointly and severally liable for all the debts of the Company then existing, and for all that shall be thereafter contracted, so long as they shall respectively continue in office;

Proviso.—provided always that the amount for which they shall all be so liable shall not exceed the amount of such dividend, and that, if any of the Directors shall be absent at the time of making the dividend or dividends so declared or paid, or if present and objecting thereto shall file their objection in writing with the Clerk or the Company, and shall forthwith publish notice of such objection in the Official Gazette or in some newspaper circulating in the place in which the registered Office of the Company is situate, they shall be exempted from the said liability.

XIII. Issue of shares by Company.—As soon as a certificate of incorporation has been granted by the Registrar of Joint-Stock Companies, the Company may issue certificates of shares to the subscribers to the Memorandum of Association, and to all other persons to whom shares may be allotted, of such number and amount as may be prescribed by the Memorandum of Association, but not of any greater number or amount: the shares so issued shall be personal estate, and shall not be of the nature of real estate, and each share shall be distinguished by its appropriate number.

XIV. Register of shareholders.—Every Company registered under this Act, hereinafter referred Register of shareholders to as “the Company,” shall cause to be kept in one B or more books a Register of shareholders, and there shall be entered therein the following particulars:—

(1) The names, addresses, and occupations, if any, of the shareholders in the Company, and the shares held by each of them, distinguishing each share by its number;

(2) The amount paid on the shares of each shareholder;

(3) The date at which the name of any person was entered in the Register as a shareholder;

(4) The date at which any person ceased to be a shareholder in respect of any share.

XV. Annual list of shareholders on Register.—Once at the least in every year a list shall be made of all persons who, on the fourteenth day succeeding the day on which the ordinary general meeting of the Company, if there is more than one ordinary meeting in each year, the first of such ordinary general meetings is held, are holders of shares in the Company; and such list shall state the names, addresses, and occupations of all the persons therein mentioned, and the number of shares held by each of them, and shall contain a summary specifying the following particulars:—

(1) The amount of the nominal Capital of the Company, and the number of shares into which it is divided;

(2) The number of Shares taken from the commencement of the Company up to the date of the summary;

(3) The amount of calls made on each share;

(4) The total amount of calls that have been received;

(5) The total amount of calls unpaid;

(6) The total amount of shares forfeited;

The above list and summary shall be contained in a separate part of the Register, and shall be in the form marked E in the Schedule hereto, or as near thereto as circumstances admit: such list and summary shall be completed within seven days after such fourteen day as is mentioned in the Section, and a copy thereof, authenticated by the seal of the Company, shall forthwith be forwarded to the Register; and any person may inspect and take copies of the same, subject to the regulations under which a person is hereafter declared to be entitled to inspect and take copies of any documents kept by the Register.

XVI. Penalty on Company not keeping a proper Register .—If any Company registered under this Act makes default in keeping a Register of shareholders, or in sending a copy of such list and summary as aforesaid to the Registrar in compliance with the foregoing rules, such Company shall incur a penalty not exceeding fifty Rupees for every day during which such default continues.

XVII. Restrictive definition shareholder.—No notice of any trust, express or implied or

constructive, shall of be entered on the Register or be receivable by the Company; and every person who has accepted any share in a Company registered under this A ct, and. whose name is entered in the Register of shareholders, and no other person (except a subscriber to the Memorandum of Association in respect of the shares subscribed for by him) shall, for the purposes of this Act, be deemed to be a shareholder.

XVIII. Transfer of shares.—The transfer of any share in the Company shall be in the form marked F in the Schedule hereto, or to the like effect, and shall be executed both by the transferrer and transferree; the transferrer shall be deemed to remain a holder of such share until the name of the transferree is entered in the Register-book in respect thereof.

XIX. Certificate of shares.—A certificate, under the common seal of the Company, specifying any share or shares held by any shareholder, shall be prima facie evidence of the title of the shareholder to the share or shares therein specified.

XX. Calls a debt to Company.—The amount of calls, for the time being unpaid on any share, shall be deemed to be a debt duo from the holder of such share to the Company.

XXI. Inspection of Register and annual of share-holders.—The Register and annual list of shareholders commencing from and the incorporation of the Company, shall be kept at the registered Office of the Company hereinafter mentioned ; except when the Register is closed as hereinafter mentioned such Register arid annual list shall during business hours, but subject to such reasonable restrictions as the Company in general meeting may impose, so that not less than two hours in each day be appointed for inspection, be opened to the in spection of any shareholder gratis, and to the inspection of any other person on the payment of one Rupee, or such less sum as the Company may prescribe for each inspection; and every such. shareholder or other person may require a copy of such Register and annual list, or of any part thereof, on payment of two annas for every one hundred words required to be copied; if such inspection or copy is refused, the Company shall incur for each refusal a penalty not exceeding Fifty Rupees, and a further penalty not exceeding Twenty Rupees for every day during wh ich such refusal continues.

XXII. Power to close Register.—The Company may, upon giving notice by advertisement in some newspapers circulating in that part of the said territories in which the registered Office of the Company is situate, close the Register of shareholders for any time or times not exceeding on the whole twenty-one days in each year; and the period, during which the books are closed, shall not be reckoned as part of the time within which a transfer is to be registered.

XXIII. Remedy for improper entry, or omission of entry in Register.—If the name of any person is without sufficient cause entered or omitted to be entered in the Register of shareholders of any Company, such person, or any shareholder of the Company, may, by petition to the principal Court of original Civil jurisdiction in the district or place in which the registered Office of the Company is situate; apply to such Court for an order that the Register may be rectified ; and the Court may either refuse such application, with o r without costs to be

paid by the applicant, or it may, if satisfied of the justice of the case, make an order for the rectification of the Register, and may direct the Company to pay all the costs of such motion or petition, and any damages the party aggrieved may have sustained; and if the Company makes default or is guilty of unnecessary delay in registering any transfer of shares, they shall be responsible to any person injured by such default or delay for the amount of damage be may thereby have sustained.

XXIV. Register to be evidence.—The Register of shareholders shall be prima facie evidence of any matters by this Act directed or authorised to be inserted therein.

XXV. Copies of Memorandum and Articles of Association to be forwarded to shareholders.— Copies of the Memorandum of Association and Articles of Association shall be forwarded by the Company to every shareholder, at his request, on pertinent of the sum of one Rupee for each copy, or such less sum as may he prescribed by the Company.

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PART II.

MANGEMENT AND ADMINISTRATION OF COMPANIES

General

XXVI. Registered Office of evidence.—The Company shall have a registered Office to which all Communications and notices may be addressed; if any Company registered under this Act carries on business without having such an Office, it shall incur a penalty not exceeding Fifty Rupees for every day during which business is so carried on.

XXVII. Notice of situation of registered Office.—Notice of the situation of such registered Office, and of any change therein, shall be given to the Registrar of Joint-Stock Companies, and recorded by him: until such notice is given, the Company shall not be deemed to have complied with the provisions of this Act with respect to having a registered Office.

XXVI. Publication of name a limited Company .—Every limited Company registered under this Act shall.—paint or affix, and shall keep painted or affixed, its name by on the outside of every Office or place in which the business of the Company is carried on, in a conspicuous position, in letters easily legible in the English language and also in the language required to used be used in judicial proceedings in the Courts of the East India Company in the District in which the registered Office is situate, and shall h ave its name engraven in legible characters in such languages on its seal, and shall have its name mentioned in legible characters in such languages in all notices, advertisements, and other official publications of such Company, and in all Bills of Exchange, Hoondees, Promissory Notes, Endorsements, Cheques, and orders for money or goods, purporting to be signed by or on behalf of such Company, and in all Bills of parcel, invoices, receipts, and letters of credit of the Company.

XXIX. Penalties on non-publication of name.—If any limited Company registered under this Act does not paint or affix, and keep painted or affixed, its name in mariner aforesaid, it shall be liable to a penalty not exceeding Fifty Rupees for not so painting or affixing its name and for every day during which such name is not so -kept painted or affixed; and if any Officer of such Company, or any person on its behalf, uses any seal purporting to be a seal of the Company whereon its name is not so engraven as aforesaid, or issues or authorizes the issue of any notice-advertisement, or other Official publication of such Company, or signs or authorises to be signed on behalf of such Company any 13111 of Exchange, Hoondee, Promissory Note, Endorsement, Cheque, or order for money or goods, or issues or authorizes to be issued any Bill of parcels, invoice, receipt, or letter of credit of the Company, wherein its name is not mentioned in manner aforesaid, he shall be liable to a penalty of Five hundred Rupees, and shall further be personally liable to the holder of any such Bill of Exchange; Hoondee, Promissory Note, Cheque, or order for money or goods, for :.the amount thereof, unless the same is duly paid by the Company.

XXX. General Meeting of Company.—A general meeting of the Company shall be held once at the least in every year.

XXXI. What accounts to be kept.—The Directors shall cause true accounts to be kept of the Stock-in-Trade of the Company; Of the sums of money received and expended by the Company, and the matter in respect of which such receipt and expenditure takes place; and of the credits and liabilities of the Company.

XXXII. Balance-sheet to be made out annually and filed with the Register.—A balance-sheet shall be made out and filed with the Registrar of Joint-Stock Companies within twelve months after the incorporation of the Company, and once at least in every year afterwards within twelve months rom the filing of the balance-sheet immediately preceding. Such balance-sheet shall contain a summary of the property and liabilities of the Company arranged under the heads appearing in the form annexed to Table B in the Schedule hereto, or as near thereto as circumstances admit.

XXXIII. Balance-sheet to be signed and certified by the Directors.—The balance-sheet shall be signed by Directors or any there or more of them, who shall certify at the foot there of that the same, to the best of their belief, contains a true account of the capital and liabilities and of the property and assets of the Company.

XXXIV. No dividend payable except out of profits.—No dividend shall be payable except out of the profits arising from the business of the Company including interest on capital.

XXXV. Audit.—The account of the Company shall be examined, and the correctness of the balance-sheet ascertained, by one or more Auditor or Auditors who shall certify, at the foot or such balance-sheet, that the same, to the best of their belief, contains a true account of the capital and liabilities and of the property and assets of the Company, or make such special report thereon as they think necessary.

XXXVI. Inspection of balance-sheet and of report of Auditors thereon.—A copy of every balance-sheet and of the report thereon by the Auditors shall be kept at the registered Office of the Company, and shall be open to inspection in the same manner as the Register of shareholders kept at such Office.

XXXVII. Appointment of Auditors.—Unless other provisions shall be contained in the regulations of the Company for the appointment of Auditors, the Auditors shall be appointed at the first general meeting of the Company in every year, in the case of any casual vacancy occurring in such office, at an extraordinary general meeting called for the purpose of supplying the same, No Directors or other Officer shall be eligible as an Auditors.

XXXIX. Power of Company to after regulations by special resolution.—Any Company registered under this Act may in general meeting, from time to time, by such special resolution as is hereinafter mentioned, after and make new provisions in lieu of or in addition to any regulations of the Company contained in the Articles of Association or the Table marked B in the Schedule.

XXXIX. Definition of special resolution.—A resolution shall be deemed to be a special resolution of the Company whenever the same has been passed by three-fourths in number and value of such shareholders of the Company, for the time being entitled to vote, as may be present in person or by proxy (in cases where, by the regulations of the Company, proxies are allowed) at any meeting of which notice specifying the intention to propose such resolution has been duly given, and such resolution has been confirmed by Majority of such shareholders, for the time being entitled to vote, as may be present in person or by proxy at a subsequent, meeting of which notice specifying the intention to propose such confirmation has been duly given, and held at an interval of not less than one month, nor more than three months from the date of the meeting at which such special resolution was first passed ; unless a poll is demanded by at least five shareholders, a declaration of the; Chairman of any such meeting as is mentioned in this Section, that a special resolution has been carried or confirmed, shall be deemed conclusive evidence of the fact, without proof of the number or proportion of the votes recorded in favor of or against the same; notice of any meeting shall, for the purposes of this Section, be deemed to be duly given,

and the meeting to be duly held, whenever such notice is given and meeting held in manner prescribed by the regulations of the Company.

XL. Registry of special resolution.—A copy of an special resolution hat is passed by any Company registered under this Act shall be forwarded to the Registrar of Joint-Stock Companies, and recorded by him ; if such copy is not so forwarded within fifteen days from the date of the passing of the resolution, the Company shall incur a penalty not exceeding Twenty Rupees for every day after the expiration of such fifteen days during which such copy is omitted to be forwarded.

XLI. Copies of special resolutions.—A copy of any special resolution shall be given to any share holder on payment of one Rupee or of such less sum as the Company may direct.

XLII. Notice to Registrar of increase of capital.—The Company, if authorised so to do by its regulations, may increase its nominal capital in manner director by such regulations; but notice of any increase so made shall be given to the Registrar of Joint-Stock Companies within fifteen days from the date of the passing of the resolutions by which such increase has been authorised, and the Registrar shall forthwith record the amount of such increase ; if such notice is not given within the period aforesaid, the Company shall incur a penalty not exceeding Fifty Rupees for every day during which such neglect to give notice continues.

XLIII. Prohibition against carrying on business with less than seven shareholders.—If any Company registered under this Act carries on business when the number of its shareholders is less than seven, for a period of six months after the number has been so reduced, then every Director of such Company during the time that it so carries on business after such period of six months, shall be severally liable for the payment of the whole debts of the Company contracted during such time, and may be sued for the same without the joinder in the action or suit of any other person.

XLIV. Evidence of proceedings at Meetings.—The Company shall cause Minutes of all resolutions and proceedings of general meeting of the Company to be dulyl entered in books to be form time to time provided for the purpose, and any such Minute as aforesaid, if signed by any person purporting to be the Chairman of such meeting, shall be receivable in evidence in all legal proceedings; and, until the contrary is proved, every general meeting, in respect of the proceedings of which Minutes have been so made, shall be deemed to have been duly held and convened.

Legal Instruments of Company.

XLV. Contracts how made. Contract on behalf of any Company registered under this Act may be made as follows ; (that is to say)

(1) Any contract which, if made between private persons, would be by law required to be in writing, and if made according to English law to be under seal, may be made on behalf of the Company in writing under the common seal of the Company; and such contract may be in the same manner varied or discharged.

(2) Any contract which, if made between private persons, would be by law required to be in writing and signed by the parties to be charged therewith, may be made on behalf of the Company in writing signed by any person action under the express or implied authority of the Company ; and such contract may in the same manner be varied or discharged.

(3) Any contract which, if made between private persons, would be law be valid although made verbally only and not reduced into writing, may be made verbally on behalf of the Company by any person action under the express or implied authority of the Company; and such contract may in the same way be varied or discharged.

And all contracts made according to the provisions herein contained shall be effectual in law, and shall be binding upon the Company and their successors, and all other parties thereto, their heirs, Executors, Administrators, or representatives, as the case may be.

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Deeds

XLVI. Execution of deeds.—Any Company registered under this Act may, by instrument or writing under their common seal, empower any person either generally or in respect of any specified matters, as their attorney, to execute deeds on their behalf in any place ; and every deed signed by such attorney, on behalf of the Company, and under his seal, shall be binding on the Company to the same extent as if ti were under the common seal of the Company.

XLVII. Promissory Notes Bills of Exchange, and Hoondees.—A Promissory Note, Bill of Exchange, or Hoondee shall be deemed to have been made, accepted, or endorsed on behalf of any Company registered under this Act, if made, accepted, or endorsed in the name of the Company by any a person action under the express or implied authority of the Company.

Examination of Affairs of Company.

XLVII. Examination of affairs of Company by Inspectors appointed by the local Government.—Upon the application of one-fifth in number and value of the shareholders of any Company registered under this Act, the local Government may appoint one or more competent Inspectors to examine into the affairs of the Company, and to report thereon in such manner as the local Government directs.

XLIV. Power of Inspectors.—It shall be the duty of all Officers and Agents of the Company to produce, for the examination of the Inspectors, all books and documents in their custody or power ; any Inspectors may examine the Officers and Agents of the Company in relation to its business, and may, if he thinks, fit, administer an oath or affirmation to such person ; if any Officer or Agent refuses to produce any such book or document, or to answer any question relating to the affairs of the Company, he shall incur a penalty not exceeding Fifty Rupees in respect of each offence.

L. Result of examination how dealt with.—Upon the conclusion of the examination, the Inspectors shall report their opinion to the local Government ; a copy shall be forwarded to the registered Officers of the Company and shall be open to the inspection of any shareholder who shall be at liberty to take a copy thereof ; and a further copy shall, at the request of the shareholders upon whose application the inspection was made, be delivered to them or to any one or more of them : all expenses of and incidental to any such examination as aforesaid shall be defrayed by the shareholders upon whose application the Inspectors were appointed.

LI. Power of Company to appoint Inspectors.—Any Company registered under this Act may in general meeting appoint Inspectors for the purpose of examining into the affairs of the Company ; the Inspectors so appointed shall have the same powers and perform the same duties as Inspectors appointed by the local Government, with this exception, that, instead of making their report to the local Government, they shall make the same in such manner and to such persons as the Company in general meeting directs ; and the Officers and Agents of the Company shall incur the same penalties, in case of any refusal to produce any book or document to such Inspectors, or to answer any question, as they would have incurred if such Inspectors had been appointed by the local Government.

LII. Report of Inspectors to be evidence.—A copy of the report of any Inspectors appointed under this Act, authenticated by the seal of the Company into whose affairs they have made inspection, shall without further proof be admissible as evidence of the report in any legal proceeding.

Notices.

LIII. Services of notices on Company.—Any summons or notice requiring to be served upon the Company may, except in cases where a particular mode of service is directed, be served by leaving the same, or sending it through the post by a registered letter addressed to the Company at their registered Office, or by giving it to any Director, Secretary or other principal Officer of the Company
; and nay notice to the Registrar of Joint-Stock companies may be served by sending it to him through the post by a registered letter, or by delivering it to him, or by leaving it for him at his Office.

LIV. Rules as to notices by letter.—Notice by letter shall be posted in such time as to admit of the letter being delivered in the due course of deliverly within the period (if any) prescribed for the

giving of such notice ; and in proving such service it shall be sufficient to prove that such notice was properly director, and that it was put into the Post Office at such time as aforesaid.

LV. Authentication of notice of Company.—Any summons notice, writ, or preceding requiring authentication by the Company may be signed by and Director, Secretary, or other authorized Office of the Company, and need not be under the common seal of the Company ; and the same may in writing or in print, or partly in writing and partly in print.

LVI. Adjudication of offences and recovery of penalties.—All offence under this Act, made punishable by any penalty, may be prosecuted summarily before a Magistrate or any person exercising the powers of a Magistrate. The provision of Act XIII of 1856, relating to the adjudication of fines and penalties and the enforcing payment thereof, shall apply to penalties imposed under this Act in the Towns of Calcutta, Madras, and Bombay, and the Settlement of Prince of Wales’ Island, Singapore, and Malacca.

Alteration of Forms.

LVII. Governor General of India in Council may alter Forms in Schedule. The Governor General of India in Council may from time to time make such alterations in the Forms and Tables contained in the Schedule hereto as may be deemed requisite : any Form or Tables, when altered, shall be punished in the Calcutta Gazette, and, after the expiration of one month from the date of such publication, shall have the same force as if it were included in the Schedule to this Act.

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PART III.

WINDIND-UP

Preliminary.

LVIII. Application of Part III of Act.—The provisions of this act relating to the winding-up of Companies shall apply to all Companies registered under this Act, and to all Companies registered under Act XLIII of 1850 or duly constituted by law previously to the passing of this Act, from and after the date at which they have obtained registration under this Act, in manner hereinafter mentioned, but not to any other Companies.

LIX. Meaning of the expressions “the Court” as used in Part III of the Act.—The expression “the Court,” shall mean the principal Court having original Civil jurisdiction in the place in which the registered Office of the Company is situate ; unless in the regulations for the management of the Company it shall be stipulated that the said Company, if wound-up shall be wound-up by the Supreme Court of Judicature for the Presidency in which the registered Office of the Company is situate, or, if the registered Office is not situate within any Presidency or in the Settlement of Prince of Wales’ Island, Singapore, and Malacca, that it shall be wound-up by such Supreme Court as shall be stipulated by such regulations, in either of which cases the word “Court” shall means the Supreme Court of Judicature mentioned in such stipulation.

LX. Liability of present shareholders in respect of debts.—In the event of any Company being wound-up by the Court or voluntarily, the existing shareholders shall be liable to contribute to the assets of the Company to an amount sufficient to pay the debts and liabilities of the Company, and the costs, charges, and expenses of winding-up the same , with this qualification, that if the Company is limited, no contribution shall be required from any shareholders exceeding the amount, if any, unpaid on the shares hold by him.

LXI. Liability of former shareholders in a Company other than a limited Company with respect to debts.—In the event of any Company other than a limited Company being wound-up by the Court, any person who has ceased to be a shareholders within the period of three years prior to the commencement of the winding-up shall be liable to contribute, in respect of the shares held by him within that period, towards payment of the debts and liabilities of the Company, and the costs, charges, and expenses of winding-up the same, and shall have in all respects the same rights, and be subject to the same liabilities to creditors in respect of such shares, as if he had not so ceased to be a

shareholders, with this exception, that he shall not be liable in respect of any debt or liability of the Company contracted after the time at which he ceased to be a shareholder.

LXII. Liability of former shareholders in a limited Company with respect to debts and liabilities.—In the event of any limited Company being wound-up by the Court, any person who has ceased to be a holder of any share or share within the period of one year prior to the commencement of the winding-up shall be liable in respect of such share or shares to contribute towards payment of the debts and liabilities of the Company, and the costs, charges, payment and expenses of winding-up the same, and shall have in all respects the same rights and be subject to the same liabilities to creditors in respect of such share or shares as if he had not so ceased to be a shareholders.

LXIII. Commencement winding-up of Company defined.—The winding-up shall, if the Company is wound-up the Court, be deemed to commence at the time of the presentation of such petition as is hereinafter required to be presented to the Court; and, if the Company is wound-up voluntarily, be deemed to commence at the time of the passing of the resolution authorizing such winding-up.

LXIV. Definition of “contributory,” and legal character of his liability.—Any existing or former shareholder, upon whom calls are authorized to be made by the Third Part of this Act, is hereinafter called a “contributory”; and the representatives of any deceased contributory shall be liable in a due course of administration to the same extent as such contributory would be liable under this Act it alive.

LXV. Rights of contributories between themselves.—For the purpose of ascertaining the liability of existing and former shareholders as between themselves, the following contract to the contrary; (that is to say)

(1) the Case of a Company other than a limited Company, every transferree of shares shall, in a degree proportioned to the shares transferred, indemnify the transferror against all existing and future debts of the Company.

(2) the case of a limited Company, every transferred shall indemnify the transferred against all calls made or accrued due on the shares transferred subsequently to the transfer.

Winding-up by Court.

LXVI. Circumstances under which Company may be wound-up by Court.— A Company may be wound-up by the Court under the following circumstances; (that is to say)

(1) Whenever the Company in general meeting has passed a special resolution requiring the Company to be wound-up by the Court ;

(2) Whenever the Company does not commence its business within a year from its incorporation, or suspends its business for the, space of a whole year ;

(3)Whenever the shareholders are reduced in. number to less than seven ; (4) Whenever the Company is unable to pay its debts ;

(5) Whenever three-fourths of the Capital of the Company have been lost or become unavailable.

LXVII. Company when deemed unable to pay its debts.—A Company shall be deemed to be unable to pay its debts—

(1) Whenever a creditor, to whom the Company is indebted in a sum exceeding Five hundred Rupees then due, has served on the Company, by leaving or causing to be left at their registered Office, a demand under his hand requiring the Company to pay the sum do due, and the Company have, for the space of three weeks succeeding the service of such demand, neglected to pay such sum, or to secure or compound for the same to the satisfaction of the creditor;

(2) Whenever satisfaction of a judgment, decree, or order of any Court in favor of any creditor in any suit or other legal Proceeding cannot be obtained.

LXVIII. Application for winding-up to be by petition.—Any application for the winding-up of a company shall be by petition accompanie d by a declaration signed by the petitioner stating that he verily believes the same to be true : such petition may, in cases where the Company is unable to pay its debts, be presented either by a creditor or a contributory ; but where any other ground is alleged for winding-up the Company, a contributory alone is entitled to present the petition.

LXIX. Course to be pursued by court on petition of creditor. —Upon the hearing of any petition presented by a creditor, the Court may dismiss such petition with or without costs to be paid by the petitioner, or it may make an order directing the Company, by a day to be named in the order, to pay or secure payment to the creditor of all monies that may be proved due to him, together with such costs as the Court may d irect ; or the Court may, if it so thinks fit, on the hearing of such petition, make an order or decree for winding-up the Company in the first instance, or such other order as it deems just.

LXX. Order for winding-up Company on creditor’s petition .—If, at the expiration of the time named in such order, such payment is not made, or security given, the Court may thereupon make an order or decree for winding -up the Company.

LXXI. Course to be pursued by Court on petition of contributory. —Upon the hearing of a petition presented by a contributory, the Court may dismiss such petition with or without costs to be paid by the petitioner, or it may make an order or decree directing the Company to be wound-up or such other order or decree as it deems just.

LXXII. Effect of the order for winding -up Company.—After the date of such order or decree for winding-up the Company, all suits and actions against the Company shall, if the Court so orders, be stayed: no Director or other Officer of the Company shall, without the sanction of the Court, dispose of any of the property, effects, or things in action of the Company; and no transfer of any shares shall be valid without the sanction of the Court: a copy of such order or decree shall forthwith be reported by the Company to the Registrar of Joint-Stock Companies, who shall make a minute thereof in his books relating to the Company.

LXXIIII. Collection and application of assets.—As soon as may be after making an order or decree for winding-up the Company, the Court shall cause the assets of the Company to be collected, and applied in discharge of its liabilities, in a due course of administration.

LXXIV. Fraudulent preference.—Any conveyance, mortgage, delivery of goods, payment, or other act relating to property, if made, done, or suffered voluntarily by any Company registered under this Act whilst in insolvent circumstance, with a view to give any undue or fraudulent in insolvent circumstances, with a view to give any undue or fraudulent preference to any creditor of such Company, shall be void if made, done, or suffered within three months before the commencement of the winding -up of such Company.

LXXV. Power of Court to summon persons suspected of having property of Company.— After an order or decree for winding-up the Company has been made, any person known or suspected to have in his possession any of the estate or effects of the Company, or supposed to be indebted to the Company, and any person whom the Court may deem capable of giving information concerning the trade; dealings, estate, or effects of the Company, may be compelled to give evidence, and to produce any books, papers, deeds, writings, or other docu - ments in his custody or power which may appear to the Court requisite to the full disclosure of any of the matters which the Court thinks necessary to be enquired into for the purpose of winding-up the Company, in the same manner as a witness may be compelled to give evidence and to produce documents in any action or suit depending in such Court.

LXXVI. Penalty on falsification of books.—If any Director, Officer, or Contributory of any Company. registered under this Act destroys, mutilates, alters, or falsifies any books, papers, writings, or securities, or make Company, or the debts in respect of which the several classes of contributories are liable, make Calls on all or any of the contributories, to the extent of their liability, for payment of all or any sums it deems necessary to satisfy the debts and liabilities of the Company and the costs •of winding it up ; and it may, in making a call, take into consideration the probability that some contributories upon whom the same is made may partly or wholly fail to pay. their respective portions of the same ; and every such call shall be deemed a debt due to the Company.

LXXVII. Execution upon certain judgment within three months of petition to be void— If, upon any judgment or decree voluntarily suffered by any Company being insolvent to any person with intent to give such person a preference over other creditors of the Company,any attachment? sequestration, or execution is issued against such Company, by virtue whereof the estate and effects of the Company, or any of them, are attached, sequestrated, or taken in execution, at any time within three months next before the filing or presentation of the petition for winding-up the Company, such attachment, sequestration, or taking in execution shall be void in favor of the Liquidators of the Company, as against the attaching, sequestrati ng, or execution creditor, whether the same has been completely executed or not, except that such creditor shall, if the attachment, sequestration, or execution would have been valid but for this provision, be entitled to retain, out of any money already realized, his costs of suit, and of the attachment, sequestration, or execution, or to proceed with the attachment, sequestration, or execution for the purpose of realizing such costs ; but on satisfaction of such costs, or on tender of the amount thereof by the Liquidators to the creditor, it shall be lawful for the Liquidators to recover from such creditor the property so attached, sequestrated, and taken in execution, and the proceeds of such property, or the residue thereof, as the case may be.

LXXVIII. Books of Company to be evidence .—All books, accounts, and documents of the Company, and of the Liquidators hereinafter mentioned, shall, as between the contributories of the Company, be prima facie evidence of the truth of all matters therein contained, and purporting to be therein recorded.

LXXIX. Power of Court to make calls.—The Court may, at any time after making an order or decree for winding-up a Company, and either before or after it has ascertained the sufficiency of the assets of the Company, or the debts in respect of which the several classes of contributories are liable, make calls on all or any of the contributories, to the extent of their liability, for payment of all or any sums it seems necessary to satisfy the debts and liabilities of the Company and the costs of winding it up; any it may, in making a call, take into consideration the probability that some contributors upon whom the same is made may partly or wholly fail to pay their respective portions of the same; and every such call shall be deemed to debt due to the Company.

LXXX. Recovery of calls.—Upon such calls being made, the Official Liquidator or Liquidators .shall proceed immediately to collect the same, and shall monthly or oftener report to the said Court the names of defaulters, together with the amounts remaining unpaid of the calls made upon -them respectively, and thereupon the said Court shall order the payment of such calls .or any of them within such time or times and upon such. notice or demand by advertisements or otherwise as the said Court may think fit ; and in case any contributory, whether subject to t he ordinary Civil jurisdiction of the Court or not, shall neglect to pay any part of the call within the time fixed by the Court for the payment thereof, and shall not within, Such time show to the Court sufficient cause for the non-payment thereof, the said Court may make an order upon such contributory for the payment of the amount due upon the call, and such order shall have the force and effect of a decree or judgment of the Court and may be executed accordingly; and all the provisions of Acts XXXIII of 1852 and XXXIV of 1855 shall apply to the execution thereof.

LXXXI. Calls may be made upon former shareholders in respect of shares. The Court may at any time make calls upon any former holder of a share who is liable under Section LXI or LXII of this Act in respect of such share as well as upon the existing holder of that share; but any

payment made or obtained from any contributory in respect of a share shall operate for the benefit of every other contributory in respect of such share.

LXXXII. Payment of money into Court.—All monies received under the direction of the Court on account of the sale or conversion of any of the assets of any Company, or in respect of calls made on any contributories, or of any other matter, with the exception of such balance (if any) as the Official Liquidators may, with the sanction of the Court, retain in their hands for the payment of current expenses, shall be paid into court or deposited in such manner as the Court any direct ; and no money standing to such account shall be paid out except upon cheques signed in such manner as the Court directs.

LXXXIII. Power of Court to grant injunction.—The Court may, at any time after the presentation of petition for winding-up the same Company, and either before or after making an order for winding-up the same, upon e application of any creditor or contributory of such. Company, restrain. further proceedings in any action or suit against the Company, or appoint a receiver of the estate and effects of the Company ; it may also, by notice or advertisement, require all creditors to present and prove their claims within a certain time, or be precluded from the benefit of any distribution which may be made before such claim is proved.

LXXXIV. Power of Court to stay proceedings.—The Court may, at any time after an order has been made Power of Court to for winding-up a Company, upon the application of any creditor or contributory of the Company, and upon proof to the satisfaction of the Court that all proceedings in relation to such winding-up ought to be stayed, make an order staying the same, either altogether or for a limited time, on such terms and subject to such conditions as it deems fit.

LXXXV. Power of Court to adjust rights of contributories. As soon as the creditors are satisfied, the Court shall proceed to themselves, and to distribute any surplus that may remain amongst the parties entitled thereto ; and for the ceed to adjust the rights of the contributories amongst purposes of such adjustment it may make calls on the contributories to the extent of their liability for payment of such sums as it deems necessary and it may, in making a call, take into consideration the probability that some of the contributories upon whom the same is made may partly or wholly fail to pay their respective portions of the same. Nothing in this Section shall preclude any former shareholder entitled to indemnity under Section LXV of this Act from enforcing such indemnity by due course of law.

LXXXVI. Power of Court to order costs.—The Court may make such order as to the priority and payment out of the estate of the Company of the costs, charges, and expenses incurred in winging-up any Company as it thinks just.

Official Liquidators.

LXXXVII. Appointment of Official Liquidators.— For the purpose of conducting the proceedings in winding-up a Company, and assisting the Court therein, there shall be appointed a person or persons to be called an Official Liquidator or Official Liquidators ; and such appointment shall be made as follows; (that is to say)

The Court having jurisdiction may, after requiring due security, appoint such persons or person, either provisionally or otherwise, as it think fit, to the office of Official Liquidators ; it may from time to remove any person or persons so appointed, and fill up any vacancy occasioned by such removal or by the death or resignation of any such appointee or appointees; if one person only is appointed, he shall have all the powers hereby given to several Liquidators; if more persons than one are appointed, the Court shall declare whether any act hereby required of or authorized to be done by the Official Liquidators may be done by all or any one or more of such persons;

In cases where the winding-up takes place at the suit of a creditor, it shall be lawful for the major part in value of the creditors assembled at a meeting to be held for the purpose, and, in cases where the winding-up takes place at the suit of a contributory, for the major part in value of the contributories assembled at a meeting to be held for the purpose, to appoint an Official Liquidator to act concurrently with the Official Liquidator so named by the Court. Every such meeting shall be held

at a time and place to be fixed by the Court, and of which meeting such notice shall be given as the Court may direct.

LXXXVIII. Style and duties of Official Liquidators. — The Official Liquidators or Liquidator shall be described by the style of the Official Liquidators or Official Liquidator of the particular Company in respect of which they or he are or is appointed, and not by their or his individual names or name ;they or he shall take into their or his custody all the property, effects, and things in action of the Company, and shall perform such duties in reference to the winding-up of the Company as may be imposed by the Court.

LXXXIX. Powers of Official Liquidators. —The Official Liquidators shall have power, with the sanction of the Court, to do the following things : —

To bring or defend any action, suit, or prosecution, or other legal proceeding, Civil or Criminal, in the name and on behalf of the Company; and in such name to claim, prove, and draw dividends under any bankruptcy, insolvency, or sequestration:

To carry on the business of the Company, so far as may be necessary for the beneficial winding-up of the same:

To sell the property (moveable or immoveable), effects, and things in action of the Company by public auction or private contract, with power, if they think fit, to transfer the whole thereof to any person or Company, or to sell the same in parcels :

To execute, in the name and on behalf of the Company, all deeds, receipts, and other documents they may think necessary ; and for that purpose to use, when necessary, the Company’s seal :

To refer disputes to arbitration, and compromise any debts or claims:

To draw, accept, make, and endorse any Bill of Exchange or Promissory Note, and also to raise upon the security of the assets of the Company from time to time any requisite sum or sums of money; and the drawing, accepting, making, or endorsing of every such Bill of Exchange or Promissory Note as aforesaid on behalf of the Company shall have the same effect with respect to the liability of such Company as if such Bill or Note had been drawn, accepted, made, or endorsed by such Company in the course of carrying on the business thereof:

To do and execute all such other things as may be necessary for winding-up the affairs of the
Company in the course of carrying on the business thereof:

To do and execute all such other things as may be necessary for winding-up the affairs of the Company and distributing its assets.

XC. Remuneration of Official Liquidators. —There shall be paid to the Official Liquidators such salary or remuneration, by way of percentage or otherwise, as the Court directs.

XCI. Dissolution of Company. —When the affairs of the Company have been completely wound-up, the Court shall make an or

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