judgement:
Appeal No. 1991 of 1971.
From the Judgment and, Order dated the 29th March, 1971, of the Bombay High Court and Bombay in Appeal No. 87 of 1970.
V.M. Tarkunde and Rameshwar Nath for the appellant K.S. Ramamurthy and B.R. Agarwal for the respondent.
The Judgment of the Court was delivered by RAY, C. J.
This is an appeal by certificate from the judgment dated 29th March, 1971 of the High Court of Bombay.
The appellant filed this suit on 2 September, 1964 in the High Court of Bombay and claimed six months salary in lieu of notice and gratuity for 16 years of service.
In the year 1965 the appellant asked for discovery by the respondent of documents relating to pension scheme for foreign employees.
The application for discovery was dismissed in the month of November, 1965.
On 16 December, 1969 the appellant took out a Chamber Summons for amendment of the plaint.
The proposed amendments were twofold.
The first set of amendment related to averments in support of the claim for gratuity which had already been alleged in the plaint.
553 The second set of amendment related to averments in support of a claim for Rs. 850 per month by way of pension as and from 1 February, 1964 during the life time of the appellant.
By an order dated 19 January, 1970 the appellant was allowed to amend the plaint in respect of the claim for gratuity.
The appellant 's proposed amendment in support of the claim for pension was refused.
By summons dated 27 April, 1970 the appellant sought an amendment of.
the plaint claiming Rs. 68,000 as damages in relation to his right to pension.
By an order dated 6 July, 1970 the appellant was allowed to amend the plaint as prayed for.
The respondent preferred an appeal against the order dated 6 July, 1970.
The High Court by judgment dated 29 March, 1971 allowed the appeal and set aside the order dated 6 July, 1970 allowing the amendment.
The appellant repeated the contentions which had been advanced before the High Court.
First, it was said that no appeal could lie against an order of amendment because it was not a judgment within the meaning of clause 15 of the Letters Patent.
Secondly, it was said that an order allowing the amendment was a discretionary cider.
Therefore, the appellate court should not have interfered with the discretion.
Counsel for the appellant submitted that 'judgment ' means a decision finally adjudicating the rights between the parties.
It was emphasised that a judgment would be a decision on substantive rights of parties. 'Amendment ' was submitted to be a procedural right.
Counsel for the appellant relied on the decision in Dayabhai vs Murrugappa Chettiar I. L. R. 13 Rang.
457 and Manohar vs Baliram I.L.R. 1952 'Nag. 471 in support of the proposition that 'judgment ' means and is a decree in a suit by which the rights of the parties in the suit are determined.
The locus classics is the decision of the High Court of Calcutta in Justice of the Peace for Calcutta vs Oriental Gas Company 8 Bengal L.R. 433 where Sir Richard Couch, C. J. said "We think that 'judgment ' means a decision which affects the merits of the question between the parties by determining some right or liability.
It may be either final or preliminary, or interlocutory, the difference between them being that a final judgment determines the whole cause or suit, and a preliminary or interlocutory judgment determines only a part of it, leaving other matters to be determined.
" This Court in Asrumati Debi vs Kumar Rupendra Deb Raikot & Ors. ; dealt with the question as to whether an order of transfer of a suit filed in the Jalpaiguri Court to the High Court to be tried in its Extraordinary Original Civil Jurisdiction was a judgment within the meaning of clause 15 of the Letters Patent.
it was held that an order for transfer of a suit is not a judgment within the meaning of clause 15 of the Letters Patent as it neither affects the merits of the 554 controversy between the parties in the suit itself nor terminates or disposes of the suit on any ground.
This Court in Asrumati Debi 's case (supra) said that a judgment within the meaning of clause 15 of the Letters Patent would have to satisfy two tests.
First, the judgment must be the final pronouncement which puts an end to the proceeding so far as the court dealing with it is concerned.
Second, the judgment must involve the determination of some right or liability though it may not be necessary that there must be a decision on the merits.
In this context this Court referred to observation of the Full Bench of the High Court of Madras in Tuljaram vs Alagappa I.L.R.
The test formulated by the Madras decision is not the form of the adjudication but its effect on the suit or proceeding in which it is made.
The Madras High Court said "if the effect is to put an end to the suit or proceeding so far as the Court before which the suit or proceeding is pending is concerned, or if its effect, if it is not complied with, is to put an end to the suit or proceeding, the adjudication is a judgment".
It may be stated here that the Madras High Court spoke of 'judgment ' on an application in a suit.
The decision of the Madras High Court in Tuljaram 's case (supra) was on an order for transfer of a suit under clause 13 of the Letters Patent.
This Court also noticed the view expressed by the Madras High Court in Tuljaram 's case (supra) that adjudication on an application, which is nothing more than a step towards obtaining a final adjudication in the suit, is not a judgment within the meaning of the Letters Patent.
In Asrumati Debi 's case (supra) this Court noticed the argument advanced that if an order refusing to rescind leave to sue granted under clause 12 of the Letters Patent was a 'judgment ' under clause 15 of the Letters Patent there was no difference in principle between an order of that description and an order transferring the suit under clause 13 of the Letters Patent.
This Court did not express any opinion excepting observing that if leave under clause 12 of the Letters Patent was rescinded, the suit would come to an end and if an order was made refusing to rescind the leave the result would be on a vital point adverse to the defendant and it would go to the root of the suit and become final and decisive against the defendant so far as the Court making the order was concerned.
In finding out whether any decision is a judgment within the meaning of clause 15 of the Letters Patent each case must be looked into, in order to find out as to whether there is a decision determining the right or liability of the parties affecting the merits of the controversy between the parties.
It is in that light that this Court in Asrumati Debi 's case (supra) described the order refusing to rescind leave to be within the category of a judgment as laid down in the Calcutta cases though no final opinion was expressed as to the propriety of that view.
The present appeal concerns an application for amendment of the plaint.
The suit was filed in the year 1964.
The application for amendment of the plaint in regard to damages for the right to pension was made in the year 1970.
An amendment, if allowed ', would relate 555 to the date of the institution of the suit.
The respondent contended before the trial Court entertaining the application for amendment of the plaint that the amendment should not be allowed inter alia on the ground that the alleged claim was barred by limitation in 1970.
The High Court in the present case relied on the decision of the High Court at Calcutta in M.B. Sarkar & Sons vs Powell & Co. A.I.R. 1956 Cal. 630.
In that case an amendment was allowed on Chambers Summons substituting in place of the original defendant which was described as a firm a defendant converted into a company in that name.
The company so proposed to be substituted complained that the amendment took away from it a valuable right which had accrued to it by efflux of time, and, therefore, the amendment should not be allowed.
The contention of the defendant was not accepted by the learned Chamber Judge.
The High Court on appeal set aside the order.
It was not held to be a case of mis description of the defendant.
A mis description of a party impleaded can arise when the party really intended to be impleaded had always been the same and such intention appeared clearly from the body of the plaint in spite of the inaccurate mis description in the cause title.
In such a case, it would not be adding a new party or substituting a new party for the original one, but perfecting the identity of the party originally impleaded clearing or rectifying the inaccurate description.
When the same person, whether an individual or a legal entity, remains the defendant but only the name is altered, it would be a case of mis description.
Where a new legal entity is substituted, it was held in the M. B. Sarkar case (supra) that substitution of a company for a firm would be a change of a substantial character affecting the right of a party.
The effect of the amendment in the M. B. Sarkar case (supra) was to substitute a new party for the party originally impleaded and the consequence was to take away from the new party so substituted his defence of limitation that a suit brought on the date of the amendment would be barred by time.
Chakravartti, C.J. in the M. B. Sirkar case (supra) said that an order for amendment of the plaint there decided a vital question concerning the merits of the case and the rights of the newly impleaded party and therefore became a judgment within the meaning of clause 15 of the Letters Patent.
The right to claim that an introduction of a cause of action by amendment is barred by limitation is founded on immunity from a liability.
A right is an averment of entitlement arising out of legal rules.
A legal right may be defined as an advantage or benefit conferred upon a person by a rule of law.
Immunity in short is no liability.
It is an immunity from the legal power of some other person.
The correlative of immunity is disability.
Disability means the absence of power.
The appellant in the present case because of the limitation of the cause of action has no power to render the respondent liable for the alleged claim.
The respondent has acquired by reason of limitation immunity from any liability.
The views of the High Courts at Calcutta and Madras with regard to the meaning of 'judgment ' are with respect preferred to the meaning of 'judgment ' given by the Rangoon and Nagpur High Courts.
556 We are in agreement with the view expressed by the High Court at Calcutta in the M. B. Sirkar case (supra) as to when an order on an application for amendment can become a judgment with in the meaning of clause 15 of the Letters Patent.
If an amendment merely allows the plaintiff to state a new cause of action or to ask a new relief or to include a new ground of relief all that happens is that it is possible for the plaintiff to raise farther contentions in the suit, but it is not decided whether the contentions are right.
Such an amendment does nothing more than regulate the procedure applicable to the suit.
it does not decide any question which touches the merits of the controversy between the parties.
Where, on the other hand, an amendment takes away from the defendant the defence of immunity from any liability by reason of limitation, it is a judgment within the meaning of clause 15 of the Letters Patent.
The reason why it becomes a judgment is that it is a decision affecting the merits of the question between the parties by determining the right or liability based on limitation.
It is the final decision as far as the trial court is concerned.
In finding out whether the order is a judgment within the meaning of clause 15 of the Letters Patent it has to be found out that the order affects the merits of the action between the parties by determining some right or liability.
The right or liability is to be found out by the court.
The nature of the order will have to be examined in order to ascertain whether there has been a determination of any right or liability.
The appellant made an application in December, 1969 for amendment of the plaint to claim pension.
Those amendments were disallowed by the learned Chamber Judge.
Four months thereafter the appellant sought to amend the plaint by adding certain paragraphs and those amendments were in relation to the appellant 's alleged claim for pension.
The appellant submitted that the second application for amendment in regard to the claim for a mortised amount of damages in relation to pension was not the same as the first application.
It was said on behalf of the appellant that if the learned Judge allowed the application the appellate court should not have interfered with the discretionary order.
The amendment order is not purely of discretion.
Even with regard to discretionary orders the appellate court can interfere where the order is insupportable in law or is unjust.
The High Court considered the second application for amendment to be a new claim based on the new set of facts which became barred on the date of the application for amendment.
In exceptional cases an amendment has been allowed where the effect is to take away from a defendant a legal right which has accrued to him by lapse of time, because the court found that consideration of lapse of time is out weighed by the special circumstances of the case.
(See Charan Das vs Amir Khan 47 I.A. 255).
The High Court rightly found that there were no special circumstances to entitle the appellant to introduce by amendments such claim.
For these reasons, the judgment of the High Court is upheld.
The appeal is dismissed with costs.
V.P.S. Appeal dismissed.

summary/full:
The appellant filed the suit against the respondent in 1964, on the original side of the High Court, claiming six months salary in lieu of notice and gratuity.
An application for amendment of the plaint in regard to damages for the right to pension was made in 1970.
The respondent contended that the amendment should not be allowed on the ground inter alia that the alleged claim was barred by limitation in 1970.
The trial Court allowed the amendment, but in appeal under Cl. 15 of the Letters Patent, the order was set aside.
The High Court considered the application for amendment to be a new claim based upon a new set of facts which became barred on the date of the application for amendment.
In appeal to this Court, it was contended that: (1) the order of the trial Court was not a judgment and hence not appealable under Cl. 15, and (2) the order was a discretionary order and the appellate Court should not have interfered with the exercise of discretion.
Dismissing the appeal, HELD : (1) A judgment within the meaning of Cl.
15 would have to satisfy two tests, (a) it must be the final pronouncement which puts an end to the proceeding so far as the Court dealing with it is concerned; and (b) it must involve the determination of some right or liability though it may not be necessary that there must be a decision on the merits.
[554 B] In finding out whether any decision is a judgment within the meaning of Cl. 15, each case must be looked into in order to find out whether there is a decision determining the right or liability of the parties affecting the merits of the controversy between the parties.
It is not the form but the nature of the order that has to be examined in order to ascertain whether there has been a determination of any right or liability.
If an amendment merely allows the plaintiff to state a new cause of action or to ask a new relief or to include a new ground of relief all that happens is that it is possible for the plaintiff to raise further contentions in the suit, but it is not decided whether the contentions are right.
Such an amendment does nothing more than regulate the procedure applicable to the suit and does not touch the merits of the controversy between the parties.
Where, on the other hand, an amendment takes away from the defendant the defence of immunity from any liability by reason of limitation, it is a judgment within the meaning of Cl. 15.
The reason why it becomes a judgment is that it is a decision.
affecting the merits of the question between the parties by determining the right or liability based on limitation.
It is the final decision as far as the Court is concerned.
The respondent, in the present case, has acquired, by reason of limitation, immunity from liability, and the appellant, because of the limitation of the cause of action, has no power to render the respondent liable for the alleged claim.
[554 B C, G., 555F H,556A C] (2) The order of the trial Court is not one purely based on discretion, and even with regard to discretionary orders the appellate Court can interfere where the order is unsupportable in law or is unjust.
The High Court was right in holding that there we 're no special circumstances to entitle the appellant to introduce the claim by amendment.
[556F] Asrumati Debi vs Kumar Rupendra Deb Raikot & Ors.
[1953] section C. R. 1159, followed.
Justice of the Peace for Calcutta vs Oriental Gas Company, 8 Bengal L. R. 433, Tuliaram vs Alagappa 1.
L. R. 35 Mad.
J., M. B. Sirkar & Sons vs Powell & Co. A.I.R. 1956.
630, approved.
Charan Das vs Amir Khan 47 1.
A. 255 referred to.
Dayabhai vs Murugappa Chettiar I. L. R. 13 Rang.
457 and Manohar vs Bailram I.L. R. , overruled.
551 For the appellant: On the first point, an order allowing amendment is not a "Judgment" within the meaning of clause 15 of the Letters Patent.
Divergent views have been taken by various High, Courts as to the meaning of word "Judgment".
This question came before this Court also in the case of 'Asrumati devi ' (1953) SCR II 59 where a question arose whether an order for transfer of a suit under clause 13 of the Letters Patent (Calcutta High Court) is not a "Judgment" within the meaning of clause 15 of the Letters Patent; and this Court took the view that an order of this character could not be regarded as a 'Judgment ' but it did not determine the true meaning and scope of the word "Judg ment", nor did it resolve a wide divergence of judicial opinion on the subject.
An order to be a 'Judgment ' in Cl.
15 of the Letters Patent must either determine some right or liability which is in controversy in the suit either partially or wholly; or it should terminate the proceedings even without deciding any right or liability in controversy.
Any wider definition of the word 'Judgment ' will make all orders appealable irrespective of their nature and irrespective of the proceeding in which they are passed.
An interim order which does not determine any substantive right or liability in controversy (i.e. does not grant or refuse any part of the relief prayed for in a suit), but decides a procedural right, however important, is not a 'judgment '.
An order allowing the amendment does not decide any substantive right or liability.
It only permits a claim to be agitated and does not decide the claim and, therefore, the order of the single judge was not appealable.
Justice of the Peace for Calcutta vs The Oriental Gas Co. 8 Bengal L.R. 433, Tuljaram vs Alagappa Chelter I.L.R. 35 Mad., I;I.L.R. Rang. 457 and I.L.R. referred to.
On the second point, it is settled law that an appellate Court will not interfere with such an order passed by the trial Court in exercise of its discretion without exceeding the limits, of its power, unless it acted perversely or unless the view taken by it is clearly wrong.
The amendment sought for became necessary as on the true and full dis closure of the terms of Pension Rules, the Appellant was found to be entitled to damages in lieu of pension.
The principle of res judicata did not apply as the earlier order of the Single Judge allowing the first amendment application partly on 19 1 1970 did not deal with the claim for mortised damage now sought to be added.
For the Respondent: There is no need to go into the larger question because judged by the tests laid down by all the High Courts including the Nagpur High Court, the decision of the trial Court in the instant case allowing the amendment, is a judgment within the meaning of Cl. 15 of the Letters Patent.
By reason of the amendment of the plaint, the claim made in the amended plaint dates back to the date of the plaint.
The application for amendment was filed in April, 1970 and by that time, the claim for pension was clearly barred by limitation.
By allowing amendment, the valuable right which had accrued to the defendant to resist the claim for pension, has been lost the defendants cannot therefore, once the amendment is allowed raise the plea of limitation.
There is a clear negation of valuable right of 552 the defendant which is undoubtedly a determination of right or liability as between the two parties.
There is difference between the amendment which does not take away the right of the defendant to plead limitation and an amendment which affects the rights of the defendants to raise the plea of limitation 1946 Calcutta 630; 1946 Bom. 361; AIR 1972 Bombay 27 ; 1967 (2) M.L.J. (FB) referred to.
35 Madras at p. 9 lays down the law that the fact that the order is one allowing the amendment, is not decisive and that if in any proceeding, the defendants could have succeeded by the Court passing an order as prayed for, that itself is sufficient to make a decision a judgment and the fact that the defendant 's contention was negatived i.e. an order prayed by him was not passed; does not make the decision any the less a judgment under Cl.
15. 29 Bombay 249, 253 in ; , 1168.
70 Ca.
W.N. 670; , referred to.
By allowing the amendment, the right is conferred upon the plaintiff and it carries with it the fastening of liabilities upon the defendants.
The decision on a vital points adverse to the defendant which goes to the root of the matter and which becomes final and conclusive, so far as the court passing of the order is concerned, would amount to a Judgment because the order is to the effect that the plaintiff is entitled to make the claim negativing the right of the defendants which has accrued to him by lapse of time.


judgement:
Appeal No. 2515 of 1973, (From the judgment and Decree dated the 11th/12th July, 1972 of the Gujarat High Court in L.P. A. No. 40 of 1969.) section T, Desai and H.S. Parihar for the appellant.
M.C. Bhandare, P. H. Parekh and Manju Jetley for respondent No. 1. 536 The Judgment of the Court was delivered by BEG, J.
This appeal, after certification by the Gujarat High Court of fitness of the case for it, I rises in the following circumstances: Uttamram Mayaram Thakar, a flourishing lawyer, made a will, on 10 6 1945 and died childless on 20 8 1946.
His widow, Bai Ruxmani, obtained, under the will, inter alia, certain shares the right and title to which are disputed before us.
On 6 3 1948, Bai Ruxmani executed a registered gift deed purporting to donate the disputed shares in various limited companies, of which details were given in the gift deed, to her brother, Vasudev Ranichandra Shelat, the appellant before us (hereinafter referred to as "Shelat").
On 18 4 1948, Bai Ruxmani also expired.
But, before she died, she had signed several blank transfer forms,apparently intended to be filled in by donee so as to enable him.
to obtain the transfer of the donated shares in the registers of the various companies and share certificates in his own name.
She had put her signatures in the correct places showing that she meant sign as the transferor of the shares.
The shares could not, however, be transferred in the registers of the various companies, in accordance with the relevant provisions of Company law, before the lady 's death.
Therefore, the respondent before us, Pranlal Jayanand Thakar, a nephew of the late Uttamram Mayaram Thakar, disputed the claim of the appellant Vasudev Ramchandra Shelat to these shares in an administration suit which came up before a learned Judge of the Gujarat High Court in second appeal together with other matters.
The learned Single Judge held that Shelat was entitled to the shares covered by the registered gift deed to which the blank transfer forms could be related but not to others said to have been orally gifted with which we are not concerned here.
The learned Judge having granted leave to file a Letter 's Patent Appeal, a Division Bench of the Gujarat High Court, which considered the rival claims, reversed the decision of the learned Single Judge even with regard to the shares covered by the registered gift deed on the ground that the gift was incomplete for failure to comply with the formalities prescribed by the Companies ' Act for "transfer" of shares.
It held that there was no equity in favour of Shelat so that he may claim a right to complete what was left incomplete by the donor in her lifetime even though there could be no doubt that Bai Ruxmani had intended to donate the shares to Shelat.
We think Mr. S.T. Desai, learned Counsel for the appellant Shelat, rightly pointed out that every material finding on questions of fact, given in favour of the appellant, was upheld by the Division Bench.
After indicating the terms of the gift deed, the Division Bench held: "Thus, it is undoubtedly true that the deed of gift discloses a clear and unequivocal intention on the part of Bai Ruxmani that Vasudev should become the owner of these shares and he should for all future time enjoy the fruits thereof.
it is a well settled position in law that unless the gift it completed as required by law, mere intention to make a gift cannot pass any title to the donee and does not make the 537 donee the owner of the property gifted by the donor.
The registered gift deed itself cannot create any transfer and so it was not competent to the donor to divest the title in her merely by the execution of the gift deed.
She was required to execute the regular transfer deeds or instruments of transfer in favour of Vasudev Shelat and hand them over to the donee, Vasudev Shelat, together with the share certificates.
" It went on to say: "The circumstances as they clearly emerge and the facts as found by the Courts below, go to show that the deed of gift was executed on March 6, 1948, and, at the same time, the re levant share certificates were handed over by the donor to the donee; and, sometime between March 6, 1948, when the gift deed was executed, and April 18, 1948, when Bai Ruxmani died blank transfer forms signed by Bai Ruxmani were handed over by Bai Ruxmani to vasudev Shelat, the donee.
" The appellant 's submissions, on facts found, may be summarised as follows: (1) As between the donor and the donee the transfer was complete with the registration of the gift deed; and, as there was a registered document, even delivery of share certificates to the donee was not necessary in view of Section 122 .
(2) Assuming, without conceding that the donor had to do something more than to execute a registered document, this too was done when the shares certificates and the signed "blank transfer" forms were handed over to the donee by the donor.
It did not matter if the name of the donee and other particulars are wanting in these blank forms.
All necessary particulars of shares involved were expressly mentioned in the gift deed which specifies and identifies each individual share meant to be donated.
The gift deed and the signed blank forms had to be read together.
The donor had done all that reasonably lay with in her power to complete the donation.
(3)The conduct of the donor, in handing over the share certificates to the donee and the blank transfer forms, read in the context of the expressly laid down intentions of the donor in the gift deed, raised the presumption of an implied authority to fill in the details and to submit to the companies concerned the forms given by the donor to Shelat before her death.
(4) There was no evidence whatsoever in the case to repel the irresistible inference of an implied authority given to the donee to fill in and submit the transfer forms so as to obtain the necessary entries in the registers of the various companies concerned.
(5) The Division Bench had, after giving all the necessary findings of fact in favour of the appellant, misdirected itself by resorting to the doctrine that there is no equity to complete an incomplete transaction, as there is when a bonafide purchaser for value comes before the Court.
538 There was no question of any equity involved here.
The simple question was one of fact.
Did the inference of an implied authority of the donee to fill in the forms and take other steps necessary to get his name entered in the registers of shareholders arise or not? Instead of considering and deciding whether such an inference arose, the Division Bench had failed to decide the real issue on the erroneous view that equity debars it from inferring an implied authority because the donee, unlike a bona fide purchaser for value, had paid nothing for the rights he could get from the donor.
All that could be urged on behalf of the respondent may be summed up as follows : (1) The facts found make out, at best, an intention of Bai Ruxmani to donate but not the completion of a donation required by law for divesting the donor of interest in the property under consideration which consisted of shares.
(2) Although shares are goods, as defined by the Sale of Goods Act, yet, they are 'goods ' of a special kind.
Their transfer is not completed merely by the execution of a registered document or by delivery but the correct mode of transfer is determined by the character of these "goods" Sec.
123 of the lays down only a general mode of transfer by gift for goods in 'general but not for the transfer by gift of shares which are a special type of 'goods ' capable of transfer only in accordance with a special mode prescribed by the Companies Act of 1913, which was applicable at the relevant time.
In other words, an adoption of the prescribed form of transfer is of the essence of a transfer for all purposes and not merely as between the shareholder and the company concerned.
(3) Sections 122 & 123 of the had to be read harmoniously with Sections 28 and 34 of the Companies Act, 1913.
(4) Since material portions of the transfer form given in regulation 19 of Table A of the first Schedule of the Companies Act of 1913 were never filled in, the doctrine of "substantial compliance" with the required form could not come to the aid of the appellant.
(5) The gift deed itself does not empower the donee to take any of those steps which remained to be taken to complete the 'transfer ', so that the doctrine of implied authority would be excluded by the ex.
press terms of the gift deed which not only do not confer any such authority Upon the donee but indicated that the donor was to take the necessary steps herself.
(6) Inasmuch as acceptance of the gift "during the life time of the donor" is a condition precedent to the validity of the gift as a transaction, and the appellant Shelat did not apply for the transfer of shares, so as to indicate his acceptance of the gift before the dono died, the purported donation was frustrated by reason of Sec.
122 of of the .
539 (7) Even if we were to assume that the facts proved disclosed that the appellant donee was armed with an implied authority to obtain a transfer, yet that authority not having been acted upon during the life time of the donor, lapsed with the donor 's death.
The result was that the donation, even if intended, was imperfect or infructuous in the eye of law and could not be perfected or completed.
Equity does not aid a merely purported donee who has given no consideration to obtain any right.
In other words, equitable considerations would not be irrelevant in deciding the question before us.
(8)Even apart from equity, under the law of agency, found in sec.
201 of our Contract Act, the Principal 's death terminates the agency, so that the doctrine of implied authority does not help the appellant.
(9) Section 202 of the Contract Act could not apply to a case where the subject matter of the alleged agency is the taking of steps to complete a transfer and not the rights which could only accrue after the necessary steps are taken.
Hence, the appellant donee could not be said to have an interest in the "subject matter of the agency" which is distinct from rights which could have arisen if the object of the agency had been fulfilled.
(10) Section 202 of the Contract Act could apply to a case where an agent has an actual or existing interest in the subject matter of the agency.
Even if the subject matter of the agency could be said to be "Property", consisting of shares, there could be no question of applying Section 202 of the Contract Act before an " 'merest" in the shares arose.
Such "interest" could only arise after a completed transfer.
(11) Section 202 of the Contract Act contemplated cases of termination of agency in ways other than death.
It meant that, so long as a Principal is alive, he could not terminate an agency so as to injure the interests of the agent in "the subject matter of the agency".
But, in the case of the death of the Principal, the relationship terminated ipso facto or automatically by death.
(12) A resort to the very concept of agency in this case presupposes that some interest of the Principal or the donor in the property said to be donated continued, or, in other words, the assumption behind it was that the donation of shares was not complete in the eye of law.
Its completion was not possible after the death of the donor.
We think that questions to be really decided in the case before us have tended to become needlessly clouded by references to statutory provisions and to doctrines or concepts which really operate in separate and distinct fields of their own.
It is true that the relevant provisions of the and the Companies Act must be interpreted harmoniously.
But, this certainly does not mean that a provision of one Act could be nullified by any provisions of the other Act.
It means that the provisions of the two Acts should be read consistently with each other so far as it is reasonably possible I to do SO.
540 We think that this end can be best achieved here by examining the objects and the subject matter, of each enactment and by viewing each relevant provision as a limb of an integrated whole meant to serve the underlying purposes.
In this way, their separable spheres of operation will be clarified so as to avoid possibilities of conflict between them or any unnecessary overflow of what really appertains to one field into another.
No doubt the is not exhaustive.
It does not deal with every kind of transfer of property which the law permits.
Nor does it prescribe the mode for every legally recognised transfer.
Nevertheless, it is an enactment meant for defining certain basic types of transfer and it lays down the requirements both of substance and of form for their legal recognition and effectiveness.
Section 5 of this Act gives a wide connotation to "transfer of pro perty".
All that it requires is that the transferor must be living at the time of the transfer recognised by the Act.
Section 6 of the Act lays down that "property of any kind may be transferred" subject to certain exceptions.
Shares in a company are certainly a form of property.
Section 28 of the Companies Act, 1913, says that they "shall be movable property, transferable in the manner provided by the articles of the company".
Both sides accept as correct the view of the Division Bench of the High Court that the shares are "goods" within the meaning of the Sale of Goods Act.
The point which, however, deserves to be noted here is that wide definition of "property" in Section 6 of the Transfer.
of Property Act includes not merely shares as transferable, movable property, but would cover, as a separable form of property, a right to obtain shares which may be antecedent to the accrual of rights of a shareholder upon the grant of a share certificate in accordance with the articles of association of company.
In M.P. Barucha & Anr.
vs V. Sarabhai & Co. '& Ors.(1) which was a case of handing over share certificates together with blank signed transfer forms, the Privy Council said (at p. 97 98): "But" further, there seems to their Lordships a good deal of confusion arising from the prominence given to the fact that the full property, in shares in a company is only in the registered holder.
That is quite true.
It is ture that what Barucha had was not the perfect right of property, which he would have had if he had been the registered holder of the shares which he was selling.
The company is entitled to deal with the shareholder who Is on the register, and only a person who is on the register is in the full sense of the the word owner of the share.
But the title to get on the register consists in the possession of a certificate, together with a transfer signed by the registered holder.
This is what Barucha had.
He had the certificates and blank transfers, signed by the registered holders.
It would be an upset of all Stock Exchange transactions if it were suggested that a broker who sold shares by general description (1) 53 Indian Appeals P. 92 @ P. 97 98.
541 did not implement his bargain by supplying the buyer with certificates and blank transfers, signed by the registered holders of the shares described.
Barucha sold what he had got.
He could sell no more.
He sold what in England would have been chooses in action, and he delivered chooses in action.
But in India, by the terms of the Indian Contract Act, these chooses in action are goods.
By the definition of goods as every kind of movable property it is clear that not only registered shares, but also this class of chooses in action, are goods.
Hence, equitable considerations not applicable to goods do not apply to shares in India.
" Thus, we find that, in Barucha 's case (supra), a distinction was made between "the title to get on the register" and "the full property in the shares in a Company., ' The first was held to have been acquired by mere delivery, with the required intention, of the share certificate and a blank form signed by the transferor.
The second is only obtained when the transferee, in exercise of his right to become a shareholder, gets his name on the register in place of the transferor.
This antecedent right in the person to whom the share certificate is given with a signed blank transfer form under a transaction meant to confer right or title upon him to become a shareholder, is enforceable so long as no obstacle to it is shown to exist in any of the articles of association of a company or a person with a superior right or title, legal or equitable does not appear to be there.
We think that Section 6 of the Justifies such a splitting up of rights constituting " property" in shares just as it is well recognised that rights of ownership of a property may be split up into a right to the "corpus" and another to the "usufruct" of the property and then separately dealt with.
122 of the defines a ",gift".
its substantial requirements are : (1) the donor must transfer "property", which is the subject matter of the gift, voluntarily and without consideration; (2) and, the donee must accept it during the life time of the donor or while the donor 's competence to give exists.
Section 123 of the prescribes the mode of transfer by gift.
It lays down that "the transfer may be effected either by registered instrument signed by the donor and attested by at least two witnesses or by delivery".
No special mode of delivery is specified.
On the other hand, it is indicated that the delivery "may be made in such a way as the goods sold are delivered".
In the case before us, the registered document was signed by the donor as "the giver" as well as by the donee as "the acceptor" of the gift, and it is attested by six witnesses.
In it, the donor specified and gave particulars of the shares meant to be gifted and undertook to get the name of the donee put on to the registers of the companies concerned.
The donor even said that she was, thenceforth, a trustee for the benefit of the donee with regard to the income she may get due to the fact that her name was still entered in the registers of the companies concerned as a shareholder.
The donor delivered the registered gift deed together with the share certificates to the donee.
We 542 think that, on these facts, the donation of the right to get share certificates made out in the name of the donee became irrevocable by registration as well as by delivery.
The donation of such a right, as a form of property, was shown to be complete so that nothing was left to be done so far as the vesting of such a right in the donee is concerned.
The actual transfers in the registers of the companies concerned were to constitute mere enforcements of this right.
They were necessary to enable the donee to exercise the rights of the shareholder.
The mere fact that such transfers had to be recorded in accordance with the company law did not detract from the completeness of what was donated.
We think the learned Counsel for the appellant rightly contended that, even in the absence of registration of the gift deed, the delivery of the documents mentioned above to the donee with the clear intention to donate, would be enough to confer upon the donee a complete and irrevocable right, of the kind indicated above, in what is movable property.
He relied upon : Kalyanasundaram Pillai vs Keruppa Mooppanar & Ors.(1); Venkatsubba Shrinivas Hegde vs Subba Rama Hegde;(2) Firm Sawan Mat Gopi Chand vs Shiv Charan Das(3).
The requirements of form or mode of transfer are really intended to ensure that the substantial requirements of the transfer have been satisfied.
They subserve an object.
In the case before us, the requirements of both Section 122 and Section 123 of the were completely met so as to vest the right in the donee to obtain the share certificates in accordance with the provisions of the Company law.
We think that such a right is in itself "property" and separable from the technical legal ownership of the shares.
The subsequent or "full rights of ownership" of shares would follow as a matter of course by compliance with the provisions of Company law.
In other words, a transfer of " 'property" rights in shares, recognised by the , may be antecedent to the actual vesting of all or the full rights of ownership of shares and exercise of the rights of shareholders in accordance with the provisions of the Company law.
The Companies Act of 1913 was meant "to consolidate and amend the law relating to trading companies and other associations".
It is concerned with the acts and proceedings relating to the formation, running, and extinction of companies, with rights, duties, and liabilities of those who are either members or officers of such companies, and of those who deal with companies in other capacities.
Its subject matter is not transfer of property in general.
It deals with transfers of shares only because they give certain rights to the legally recognised shareholders and imposes some obligations upon them with regard to the companies in which they hold shares.
A share certificate not merely entitles the shareholder whose name is found on it to interest on the share held but also to participate in certain proceedings relating to the company (1) 54 I. A. 89.
(2) ILR (3) AIR 1924 Lab.
543 concerned.
It is for this purpose that Section 34 of the Companies Act, 1913 enables the making of "an application for the registration of the transfer of shares in a Co. . either by the transferor or the transferee".
A share certificate is a prima facie evidence, under Sec. 29 of the Act, of the title to a share. 'Sec.
34 of the Act does not really prescribe the mode of transfer but lays down the provisions for "registration" of a transfer.
In other words, it presupposes that a transfer has already taken place.
The manner of transfer of shares, for the purposes of Company law, has to be provided, as indicated by Sec. 28, by the articles of the Company, and, in the absence of such specific provisions on the subject, regulations contained in Table 'A ' of the 1st Schedule of the Companies Act apply.
Table 'A ' of the 1st Schedule to the Companies Act of 1913 gives regulation 19 as follows "19.
Shares in the company shall be transferred in the following form, or in any usual or common form which the directors shall approve : 1, A. B. of in consideration of the sum of rupees paid to me by C. D. of (hereinafter called "the said transferee"), do hereby transfer to the said transferee the share (or shares) numbered in the undertaking called the Company, Limited, to hold unto the said transferee, his executors, administrators and assigns, subject to the several conditions on which I held the same at the time of the execution thereof, and I (the said transferee) do hereby agree to take the said share (or shares) subject to the conditions aforesaid.
As witness our hands the day of Witness to the signatures of, etc.
" Apparently, the form given here is only for sales.
In the case of a gift the more general provisions of regulation 18 would apply.
This regulation says : "The instrument of transfer of any share in the company shall be executed both by the transferor and transferee, and the transferor shall be deemed to remain holder of the share until the name of the transferee is entered in the register of members in respect thereof.
" We find from the gift deed that both the donor and the.
donee have signed the document, under two headings respectively : "giver of the gift" and "acceptor of the gift".
Hence, we think that the broadly indicated requirements of regulation 18 were also complied with by the contents 'of the gift deed.
It is immaterial that the gift deed deals with a number of items so long as the requirements of regulation 18 are fulfilled.
After all, the observance of a form, whether found in the or in the Companies Act, is meant to serve the need of the substance of the transaction which were undoub tedly shown to have been completely fulfilled here.
There is nothing in regulation 18 or anywhere else in our Company law to indicate that, 544 without strict compliance with some rigidly prescribed form the transaction must fail to achieve its purpose.
The subservience of substance of a transaction to some rigidly prescribed form required to be meticulously observed savors of archaic and outmoded jurisprudence.
Buckley on the Companies Acts (XIII Edn.
p. 813) was cited before us for the proposition that "non registration of a transfer of shares made by a donor does not render the gift imperfect".
Considerable argument was advanced by both sides on the correct interpretation of the leading English case mentioned there : Re Nose, Midland Bank Executor & Trustee Co. Ltd. vs Rose,(1) where Jenkins J., after an exhaustive discussion of the English case law on the subject, held that when a testator had done everything that lay in his power to divest himself of his Fights in preference shares "completion of the legal title by registration could only be the act of a third party which did not affect the efficacy of the gift of shares inter vivos".
The Court of Appeal upheld this decision in : In Be Rose V. Inland Revenue Commissioners.(2) It held that "the deceased was in the position of.
a trustee of the legal title in the shares for the transferees", pending the entry of the names of the donees in a company 's register and the issue of share certificates to them.
In the case before us, we find that Bai Ruxmani had actually stated in the gift deed that her position, vis a vis the donee, who had accepted the gift, was that of a trustee for the benefits received by her from the gifted shares until the completion of the legal formalities so that appropriate entries are made in ' the registers of companies concerned and fresh share certificates are issued to the donee.
We, therefore, think that this case helps the appellant.
In M/s.
Howrali Trading Co. Ltd. vs The Commissioner of Income tax, Calcutta(3), considering a case of blank transfers, Hidayatullah J., speaking for this Court, said (at p. 453) : "In such blank transfers, the name of the transferor is entered, and the transfer deed signed by the transferee, who, if he so chooses, completes the transfer by entering his name and then applying to the company to register his name in place of the previous holder of the share.
The company recognises no person except one whose name is on the register of members, upon whom alone calls for unpaid capital can be made and to whom only the dividend declared by the company is legally payable.
of course, between the transferor and the transferee, certain equities arise even on the execution and handing over of a blank transfer ', and among these equities is the right of the transferee to claim the dividend declared and paid to the transferor who is treated as a trustee on behalf of the transferee.
These equities, however, do not touch the company, and no claim by the transferee whose name is not in the register of (1) (2) [1932] (1) Ch.
D. 499.
(3) [1959] Supp.
(2) SCR 448 @ 453.
545 members can be made against the company, if the transferor retains the money in his own hands and fails to pay to it to him.
" This case also makes a distinction between an antecedent right and title of the transferee under a blank transfer and the fully blossomed rights and title of such a transferee after the due registration of a transfer.
Another case cited before us was : R. Subba Naidu vs Commis sioner of Gift Tax, Madras,(1) where a distinction was made between a transfer of the antecedent right to the shares which operated with full force between a donor and the donee, "notwithstanding that, vis a vis the company, the donor continued to be holder of the shares in the absence of transfer of shares".
In other words, the fields of operation of the provisions of Sections 122 and 123 of the and the provisions of the Companies Act 1913 were different.
Each had different objects and legal consequences.
The Companies Act did not prevent the completion of a gift of the right to obtain the shares which could, in common parlance or loosely speaking, be spoken of as a gift of shares themselves even before the gift is acted upon so that the donee obtains share certificates in his own name.
The could not enable the donee to exercise the rights of a shareholder, vis a vis the company, until a transfer of shares is made in accordance with the Company law.
other cases cited on behalf of the appellant, which we will only mention without discussion, were 1.
Colonial Bank vs Hepworth(2); 2.
In Re.
Tahiti Cotton Company ex parte Sargent(3); 3.
In Re. Letheby & Christopher, Limited(4); 4.
In the matter of Bengal Silk Mills Co. Ltd.(5); 5.
The Bank of Hindustan Ltd. & Ors.
vs Kowtha Suryanara yana Rao & Ors.(6); 6.
Arjun Prasad &.Ors.
vs Central Bank of India Ltd. (7); 7.
Benode Kishore Goswani vs Ausutosh Mukhopadhya & Anr.(8).
Learned Counsel for the respondent cited the following passage from the Palmer 's Company Law (21st edition 1968, p. 334).
A transfer is incomplete until registered.
Pending registration, the transferee has only an equitable right to the shares transferred to him.
He does not become the legal owner until his name is entered on the, register in respect of these shares." (1) [1969] (Vol.
(2) (3) [1873] (17) Equity Cases 273@ 279.
(4) , (5) AYR @ 464.
(6) RR @ 1072.
(7) AIR 1956 Pat.
(8) 546 This statement of the law in England is correct.
The transferee, under a gift of shares, cannot function as a shareholder recognised by company law until his name is formally brought upon the register of a company and he obtains a share certificate as already indicated above.
indeed, there may be restrictions on transfers of shares either by gift or by sale in the articles of association.
Thus" we find in Palmer 's Company Law (at p. 336) : "There is nothing to limit the restrictions which a company 's articles may place on the right of transfer.
The articles may give the directiors power to refuse to register a transfer in any specified cases, for instance, where calls are in arrear, or where the company has a lien on the shares and some such provisions are usually inserted.
Thus article 24 provides that the directors may decline to register any transfer of a share (not being a fully paid share) to a person of whom they do not approve, and may also decline to register any transfer of shares on which the company has a lien.
But the articles in many cases go far beyond this.
They may prohibit, for example, the transfer of a share to any person who is not a member of a specified class, or provide, as they often do in private com panies, that before transferring to an outsider the intending transferor must first offer the shares to the other members, and give them a right of pre emption.
Such provisions, though permanent, do not contravene the rule against perpetuities.
" In the type of cases contemplated above, where there are special restrictions on the transfer of shares imposed by the articles of association, the difficulty or defect is inherent in the character of such shares.
In such cases, the donee or purchaser cannot get more than what the transferor possesses.
Therefore, in such cases, it is possible to hold that even the right and title to obtain shares, which we have viewed as separable from the legal right and title to function as a shareholder, is incomplete because of a defect in the nature of shares held due to some special restrictions on their transferability under the articles of association of the company concerned.
But, such is not shown to be the case at all with any of the shares which formed the subject matter of the gift in favour of Shelat.
Hence, in our opinion, cases which deal with inchoate rights to shares do not assist the respondent because at least a gift of the right to obtain the transfer of shares in the books of the companies concerned was shown to be complete on the terms of the gift deed of Bai Ruxmani coupled with the handing over of the share certificates and the subsequent signing of the blank transfer forms.
It was not a ease of a bare expression of an intention to donate.
The donor had done everything which she could reasonably be expected to do to divest herself of her rights in the shares donated.
Ireland vs Hart '(1) relied upon by the respondent, was a case in which a prior equitable title of a wife, for whom the husband was a (1) [1902] (1) C.D. p. 522 @ 529.
547 trustee, took precedence over the claim of a subsequent mortgagee.
This case was cited in Palmer 's Company Law as an instance of how delay in registration may endanger the claims of a transferee when some already existing prior equity comes to light In upholding the wife 's claim of a prior equitable right the Court said (at p. 529) : "It is established by Societe Generale de Paris vs Walker (11 App.
Case 20), Roots vs Williamson ; and Moore vs North Western Bank [1891(2) Ch.
599] that, where the articles are in the form in which they are in the present case, a legal title is not acquired as against an equitable owner before registration, or at all events until the date when the person seeking to register has a present absolute and unconditional right to have the transfer registered.
I am not called upon to define the meaning of a present absolute and unconditional right, but, as it appears to me, I am not sure that anything short of registration would do except under very special circumstances.
At all events, I am of opinion that in this case, prior to the date of the injunction, the defendant Hart had not a 'present absolute and unconditional right ' to the registration of the transfer of these shares, and that the prior equitable right of the plaintiff, Mrs. Ireland, must prevail." Thus, what was disputed there was the right to obtain registration of a transfer of shares.
The husband 's power to mortgage was itself circumscribed by his position as a trustee.
It was also pointed out in Palmer 's Company Law (at p. 334) "It has never been clearly decided in what circumstances the `present, absolute, unconditional right to have the transfer registered ' to which Lord Selborne refers arises.
It is thought that in many instances the test is that indicated by Jenkins J. in Re. Rose. 'I was referred on that to the well known case of Milroy vs Lord and also the recent case of Re. Fry, Chase National Executors & Trustees Corpn.
vs Fry.
Those cases, as I understand them, turn on the fact that the deceased donor had not done all in his power, according to the nature of the property given, to vest the legal interest in the property in the donee.
In such circumstances it is of course, well settled that there is no equity to complete the imperfect gift.
If any act remained to be done by the donor to complete the gift at the date of the donor 's death the court will not compel his personal representatives to do that act and the gift remains incomplete and fails.
In Milroy V. Lord the imperfection was due to the fact that the wrong form of transfer was used for the purpose of transferring certain bank shares, The document was not the appropriate document to pass any interest in the property at all.
In Re Fry the flaw in the transaction, Which was a transfer or transfers of shares in a certain company, 548 was failure to obtain the consent of the Treasury which in the circumstances surrounding the transfers in question was necessary under the Defence (Finance Regulations) Act 1939, and, as appears from the head note, what was held was that the donor 's executors ought not to execute confir matory transfers.
In this case, as I understand it, the testator had done everything in his power to divest himself of the shares in question to Mr. Hook.
He had executed a transfer.
It is not suggested that the transfer was not in accordance with the company regulations.
He had handed that transfer together with the certificates to Mr. Hook.
There was nothing else the testator could do.
Therefore it seems to me that the present case is not in pari materia with the two cases to which I have been referred.
The real position, in my judgment, is that the question here is one of construction of the will.
The testator says "if such preference shares have not been transferred to him previously to my death.
" The position was that, so far as the testator was concerned, they had been so transferred.
" Respondent 's learned Counsel also relied on Re Fry, Chase National Executors & Trustees Corpn.
Ltd. vs Fry & Ors.(1) which has been referred to by Jenkins J. in the passage quoted above.
In that case, apart from other distinguishing features, the flaw in the purported transfer was that it contravened the Defence (Finance Regulation) Act, 1939, which prohibited an acquisition of interest in the shares without a licence from the Treasury.
Hence, the purported transfer was really illegal.
No such illegality is shown to exist in the case before us.
Respondent 's learned Counsel cited Amarendra Krishna Dutt vs Monimunjary Debi, (2) where, after a husband had executed a document in favour of his wife, the parties had done nothing to get the transfer registered for nearly 2 years during which the dividend was received sometimes by the wife and sometimes retained by the husband with the permission or implied consent of the wife.
The Court held that the purported gift being an intended "transfer" only could not operate as a "declaration of trust".
Another ground for the decision was that "the disposition of the shares failed as being imperfect voluntary gift".
Here, the Calcutta High Court purported to follow Milroy vs Lord, (3) and, Richards vs Delbridge(4).
No such facts are present in the case before us.
Moreover, we seriously doubt the correctness of this decision of the Calcutta High Court.
It seems to conflict with the law declared in the cases cited by the appellant which we approve.
Another case relied upon by the respondent was: The Bank of Hindustan Ltd. V. Kowtha Suryanarayana Rao & Ors.
(supra), where the Court refused,.
to direct rectification of a register of member s (1) (2) ILR (3) ; (4) 1874 LR.
18 Eq.
549 because the articles of association vested an absolute discretion in the company to recognise or refuse to recognise a transfer.
The Company 's consent to a transfer had been refused because the company did not accept the correctness of the form of transfer deeds.
In other words, this was a case in which the provisions of articles of association stood in the way of rectification of the register.
Such is not the case before us.
The result is that We do not think that the respondent has made out a case for defeating the clearly expressed intentions of the donor coupled with the authority with which the donee was armed by reason of the signed blank transfer forms.
We think that the implied authority was given with regard to a subject matter in which Shelat had acquired an interest.
On a correct interpretation of the gift deed and the other facts mentioned above, we are of opinion that the right to obtain a transfer of shares was clearly and completely obtained by the donee appellant.
There was no question here of competing equities because the donee appellant was shown to have obtained a complete legal right to obtain shares under the gift deed and an implied authority to take steps to get his name registered.
This right could only be defeated by showing some obstacle which prevented it from arising or which could defeat its exercise.
No such obstacle having been shown to us to exist, the rights of the donee appellant would prevail as against any legal rights which could have accrued to others if the donee had not already acquired the legal right which, as held by us above, had become vested in him.
We, therefore, allow this appeal with costs and set aside the judgment and decree of the Division Bench of the High Court and restore that of the learned Single Judge.

dataset_name: IN-Abs

summary/full:
By a registered deed, a donor gifted to the appellant shares in various limited companies.
Before her death the donor had signed several blank transfer forms to enable the done to obtain transfer of the shares in the register of companies and share certificates in his name.
She had signed at the correct places showing that she meant to sign transfer of shares but the transfer could not be effected before the donor 's death.
The respondent claiming the shares filed an administration suit.
A single Judge of the High Court held that the appellant was entitled to shares covered by the gift deed to which blank transfer forms could be related.
A division bench of the High Court reversed the decision of the Single Judge on the ground that the gift was incomplete for failure to comply with the formalities prescribed by the Indian Companies Act, 1913 for transfer of shares.
It further held that there was no equity in favour of the appellant so that he may claim the right to complete what was left incomplete by the donor in her life time.
On appeal it was contended in this Court (1) that since the donor had signed the blank transfer forms and handed them over to the done, the gift deed and the signed blank forms had to be read together and (2) that the transfer was complete with the registration of the gift deed and even delivery of share certificates to the done was not necessary in view of section 122 of the .
Allowing the appeal, HELD:(1) The respondent has not made out a case for defeating the clearly expressed intentions of the donor, coupled with the authority with which the donor was armed by reason of the signed blank transfer forms.
On a correct interpretation of the gift deed and other material the right to obtain a transfer of shares was clearly and completely obtained by the donee appellant.
There was no question of competing.equities because the donee appellant was shown to have obtained a complete legal right to obtain shares under the gift deed and an implied authority to take steps to get his name registered.
[549B D] The fact that the relevant provisions of the and the Companies Act must be interpreted harmoniously does not mean that a provision of one Act could be nullified by any provision of the other Act.
It means that the provision of the two Acts should be read consistently with each other so far as it is reasonably possible to do so.
This end can be best achieved by examining the objects and the subject matter of each enactment and by viewing each relevant provision as a limb of an integrated whole meant to serve the underlying purposes.
In this way their separable spheres of operation will be clarified so as to avoid possibilities of conflict between them or any unnecessary overflow of what really appertains to one field into another.
[539H 540B] (2) The is an enactment meant for defining certain basic types of transfers and lays down the requirement both of substance and of form for their legal recognition and effectiveness.
Section 5 of the Act gives a wide connotation to "transfer of property".
Section 6 of the Act lays down that "property of any kind may be transferred" subject to certain exceptions.
Shares in a company are certainly a form of property.
Section 28 of the Companies says that they "shall be movable property, transferable in the manner provided by articles of the Company".
A wide definition of "property" in section 6 of the includes not merely shares as transferable, movable property.
but would cover as a separate form of property a right to obtain shares which may be antecedent to the accrual of rights of a shareholder upon the grant of a share certificate in accordance with the articles of association of a company.
[540B E] There is a distinction between "the title to get on the register" and "the full property in the shares in a company".
The first is acquired by mere delivery, with the required intention of the share certificate and a blank form signed by the transfer.
The second is only obtained when the transferee, in exercise of his right to become a shareholder, gets his name on the register in place of the transferor.
This antecedent right in the person to whom the share certificate is given with a signed blank transfer form under a transaction meant to confer right or title upon him to become a shareholder is enforceable so long as no obstacle to it is shown to exist in any of the articles of association of a company or a person with a superior right or title, legal or equitable, does not appear to be there.
Section 6 of the T.P. Act justifies such a splitting up of rights constituting property in shares just as it is well recognised that rights of ownership of property may be split up into a right to the "Corpus" and another to the "usufruct" of the property and then separately dealt with.
[541C E] M.P. Barucha & Anr.
V. V. Sarabhai & Co. & Ors.
53 Indian Appeals P. 92 @ 97 98, relied on.
Section 122 of the defines a "gift".
Section 123 of the T. P. Act prescribes the mode of transfer by gift.
No special mode of delivery is specified in the section.
On the other hand it is indicated that the delivery "may be made in such a way as the goods sold are delivered".
[541E G] In the instant case the registered document was signed both by the donor and donee and is attested by witnesses.
The donor specified and gave particulars of the shares meant to be gifted.
The donor delivered the registered gift deed together with the share certificates to the donee.
On these facts the donation of the right to get share certificates made out in the name of the donee became irrevocable by registration as well as by delivery.
The actual transfers in the registers of the companies concerned were to constitute mere enforcement of this right.
They were necessary to enable the donee to exercise the rights of the shareholder.
The mere fact that such transfers had to be recorded in accordance with the Company Law did not detract from the completeness of what was donated.
[541G 542B] The broadly indicated requirements of regulation 18 of Table A of 1st Schedule to the Companies Act, 1913 were also complied with by the contents of the gift deed.
It is immaterial that the gift deed deals with a number of items so long as the requirements of Regulation 18 are fulfilled.
The observance of a form whether found in the or in the Companies Act is meant to serve the needs of the substance of the transaction which were undoubtedly shown to have been completely fulfilled here.
There is nothing in Regulation 18 to indicate that without strict compliance with some rigidly prescribed form, the transaction must fail to achieve its purpose.
The subservience of substance of a transaction to some rigidly prescribed form required to be meticulously observed, savors of archaic and outmoded jurisprudence.
[543G 544A] Re Nose, Midland Bank Executer & Trustee Co. Ltd. vs Rose.
, Re Rose, Rose vs Inland Renvenue Commissioners, , M/s.
Howrah Trading Co. Ltd. vs The Commissioner of Income tax, Calcutta, [1959] Supp.
(2) SCR 448 @ 453 referred to.


judgement:
Appeal No. 1955 of 1970.
Appeal by Special Leave from the judgement & other dated the 5th November, 1969 of the Punjab & Harayana High Court in Civil Write No. 309 of 1969.
R. K. Garg, section C. Agarwala and V. J. Francis, for the appellant.
775 V. C. Mahajan and 0.
P. Shorma, for the respondents.
The Judgment of the Court was delivered by RAY, C.J.
This is an appeal by special leave from the judgment dated 5 November, 1969 of the High Court of Punjab and Haryana.
The only person is whether the order of termination of the service of the appellant who was a probationer is in violation of Rule 9 of the Punjab Civil Service (Punishment & Appeal) Rules, 1952.
The appellant was selected by the Public Service Commission as a direct recruit on 20 May, 1965.
He was appointed on 26 May, ' 1965.
He joined as a probationer.
The period of probation was two years.
Rule 8(b) of the Punjab Police Service Rules 1959 states that the services of a member recruited by direct appointment may be dispensed with by the Government on his failing to pass the final examination at the end of his period of training, or on his being reported on during or at the end of his period of probation, as unfit for appointment.
The order terminating the services of the appellant was as follows: The President of India is pleased to dispense with the service of Shri Hari Singh Mann, Probationery Deputy Superintendent of Police, Amritsar on the expiry of his extended period of probation with effect from 2 2 1969(A.N.) under rule 8(b) of the Punjab Police Service Rules 1959, having considered him unfit for appointment to the State Police Service.
The period from 20 5 68 to 2 8 68 which has been treated as leave of the kind due has been excluded from the period of trial (Probation).
" The two contentions which have been advanced before the High Court were repeated here.
First, the order of termination was passed on 30 January, 1969 when the petitioner by reason of expiry of three years stood confirmed on 19/20 November, 1968.
Second the order of termination was one of punishment and the appellant should,therefore, under Rule 9 of the Punjab Civil Service (Punishment and Appeal) Rules have been given opportunity to show cause against the order of termination.
Under the aforesaid (Police Service) Rule 8(b) proviso, the Government could extend the period of probation by not more than one year.
The appellant was appointed on 20 May, 1965 on two years probation.
On 1 July, 1967, there was an order extending the period of probation by one year.
On 20 May, 1968, there was an order terminating the services of the petitioner.
on 20 July.
1968 there was an order revoking the order of termination and extending the period of probation for six months from 20 May, 1968.
The order of termination was on 30 January, 1969.
The appellant was on leave from 20 May, 1968 to 2 August, 1968.
The 776 Government excluded the period of leave from the period of probation.
The object of extending the period of probation is to find out whether the appellant was a fit person.
The appellant could not be confirmed till the period of probation to find out the fitness of the appellant expired.
It cannot therefore be held that the appellant stood confirmed on 19/20 November, 1968 before the period of probation expired in January, 1969.
The appellant relied on Rule 9 of the Punjab Civil Services (Punishment and Appeal) Rules, 1952.
Rule 9 is as follows "Where it is proposed to terminate the employment of a probationer, whether during or at the end of the period of probation, for any specific fault or on account of the un satisfactory record or unfavourable reports implying the unsuitability for the service, the probationer shall be ,apprised of the grounds of such proposal, and given an opportunity to show cause against it, before orders are passed by the authority competent to terminate the appointment".
If (Punishment) Rule 9 applies the services of the appellant could not be terminated without complying with the previsions thereof.
The appellant contended that the order of termination stated that the appellant was considered unfit for appointment and therefore it amounts to punishment to attract rule 9.
The appellant extracted a statement from the affidavit of the Inspector General of Police in answer to the appellant 's petition in the High Court that the appellant 's record during the period of probation was unsatisfactory Reliance is placed on rule 9 where it is said that if the termination of the Services of a probationer be on account of unsatisfactory record he shall be given an opportunity to show cause against it.
The respondent relied on rule 11 of the Punjab Police Service Rules where it is stated that in matters relating to discipline, penalties 'and appeals, members of the Service shall be governed by the Punjab Civil Services (Punishment and Appeal) Rules.
Therefore, it is said by the respondent that Rules 8 and 11 of the Punjab Police Service Rules show that termination of probation which is dealt with in rule 8 is different from matters relating to penalties which are dealt with in rule II of the Punjab Police Service Rules.
Termination on account of unsatisfactory record will attract rule 9 of the Punishment Rules.
It is obvious that at the time of confirmation fitness is a matter to be considered.
The order terminating the services is unfitness for appointment at the time of confirmation, it is not passed on the ground of any turpitude like misconduct or inefficiency.
To hold that the words "unfit to be appointed" are a Stigma would rob the authorities of the power to judge fitness for work or suitability to the post at the time of confirmation.
777 Termination of services on account of inadequacy for the job or for any temperamental or other defect not involving moral turpitude is not a stigma which can be called discharge by punishment.
Fitness for the job is one of the most important reasons for confirmation.
The facts and circumstances do not show that there is any stigma attached to the order of termination.
For these reasons, the appeal fails and is dismissed.
Parties will pay and bear their own costs.
V.M.K. Appeal Dismissed.

summary/full:
The appellant was appointed on 20 May, 1965, on two years ' probation.
On 1 July, 1967 there was an order extending the period of probation by one year.
On May 20, 1968, there was an order terminating the services of the petitioner.
On July 20, 1968 there was an order revoking the order of termination and extending the period of probation for six months from 20th May, 1968.
The order of termination was on Jan. 30, 1969.
This order recited that, having considered him unfit for appointment to the State Police Service the services of the appellant are dispensed with on the expiry of his extended period of probation.
Two contentions were raised by the appellant in the High Court.
First, the order of termination was passed on Jan. 30, 1969, when the petitioner.
by reason of expiry of 3 years stood confirmed on 19/20 November, 1968 and Second, the order of termination was one of punishment and the appellant should have been given an opportunity to show cause against the order of termination under Rule 9 of the Punjab Civil Service (Punishment and Appeal) Rules, 1952.
These contentions were rejected by the High Court.
Hence the appeal to this Court by Special Leave.
Dismissing the appeal, HELD: The object of extending the period of probation is to find out whether the appellant was a fit person.
The appellant could not be confirmed, till the period of probation expired.
It cannot, therefore, be held that the appellant stood confirmed on 19/20 November, 1968 before the period of probaition expired in January, 1969.
[776A B] (2) Termination on account of unsatisfactory record will attract rule 9 of the Punishment Rules.
Fitness was a matter to be considered at the time of confirmation.
The order terminating the services is unfitness for appointment and not on the ground of any turpitude to attract Rule 9 of the Punishment Rules, 1952.
To hold that the words "unfit to be appointed" mentioned in the order of termination, are a stigma, would deprive the authorities to judge fitness 'for work or suitability to a post at the time of confirmation.
Termination of services on account of inadequacy for the job or for any tompramental or other defect not involving moral turpitude is not a stigma which can be called discharge by punishment.
Fitness for the job is one.
of the most important reasons for confirmation.
The facts and circumstances do not show that there was any stigma attached to the order of termination and therefore, Rule 9 of the Punjab Civil Service (Punishment & Appeal) Rules, 1952 is not attracted in the present case.
[7760 777B]


judgement:
Appeal No. 1748 of 1967.
From the Judgment and order dated the 6th January 1961 of the Mysore High Court at Bangalore in.
Second Appeal No. 129 of 1956.
section C. Malik A. section K. Rao arid M. R. K. Pillai for the appellant.
K. Rajendra Chaudhuy, for the respondents Nos. 1 8.
The Judgment of the Court was delivered by ALAGIRISWAMI, J.
This is, an appeal by certificate against the judgment of the High Court of Mysore in a second appeal.
it, arises out 971 of a suit filed by respondents 1 and 2 (who,will hereafter be referred to as plaintiffs) for a declaration that the sale held in execution of the decree obtained by the appellant (who was the 9th defendant in the, suit) in O. section No. 31 of 1937 38 against their father and other members of their family was void ab initio.
O. section No. 31 of 1937 38 had been filed by the present appellant on, the basis of a promissory note executed as already mentioned by the father of the plaintiffs and other members of that family.
In execution all the sixteen items of property belonging to the family were sold.
The sale was in pursuance of an attachment before the judgment made on 25th September 1937.
The suit was subsequently decreed.
In the suit the only plea taken was that the defendants were agriculturists entitled to the benefit of the Mysore: Agriculturists Relief Act 1928.
The plaintiffs filed the suit for a mere declaration because they continued in possession of the properties which had been sold in execution and purchased by defendants 10 and, 11 in the suit and subsequently purchased by the appellant.
The Trial Court decreed the suit.
It should be mentioned that the suit was filed on 14 5 1952.
The plaintiffs were born respectively in.
the years 1944 and 1950.
On appeal the District Judge hold that the sale was void but allowed the appeal on the ground that the plaintiffs were not born on the date of the sale.
A Division Bench I of the Mysore High Court allowed the Second Appeal and restored the judgment of the Trial.
Court.
The main question for decision as to whether the execution sale was void ab initio depends on the interpretation to be placed on section 14.of the Mysore Agriculturists ' Relief Act which roads as follows:.
(1) Except as otherwise provided in subsections (2), (3), and (4) no agricultural land belonging to an agriculturist shall be attached or sold in execution of any decree or order passed after this Act comes into force, unless it has been specifically mortgaged for the payment of the debt to which such decree or order relates and the security still subsists, For the purposes of any such attachment or sale as aforesaid standing crops shall be deemed to be movable property.
(2) The Court may at the time of passing a decree for money directing payment by instalments or at any time during the course of execution of such decree direct the judgment debtor for sufficient cause to furnish security for the amount of the decree and if he fails to furnish the security required order the attachment of any agricultural land belonging to the judgment debtor.
(3) The procedure in respect of attachments ordered under subsection (2) shall be as far as may be in accordance with the procedure relating to attachment before judgment under Order XXXVIII of the Code of Civil Procedure 1908.
972 (4) No agricultural land ordered to be attached under sub section (2) shall be sold in pursuance of such attachment unless the judgement debtor is in arrears in respect of two or more instalments under the decree.
We are, in agreement with the view taken by the Courts below and the High Court that the attachment before judgement made in this case was not a valid one and therefore the sale in pursuance of that attachment was void.
We are unable to accept the argument on behalf of the appellant that s, 14 does no more than lay down the same procedure as Order 38 of the Code of Civil Procedure and therefore the attachment was valid.
Sub section
(1) of section 14 lays down that no agricultural land belonging to an agriculturist shall be attached or sold in execution of any decree or order unless it has been specifically mortgaged for the payment of the debt to which such decree or order relates.
The suit :filed by the appellant O.S. No. 31 of 1937 38 was not on the foot of a mortgage and therefore the sale effected in execution of the decree obtained by the appellant is clearly against the provisions of sub section
Sub section (2) permits an attachment only in execution of a decree and, therefore, there is no substance in the argument on behalf of the appellant that the attachment effected before judgment at the instance of the appellant is similar to an, attachment before judgment tinder Order 38 of the Code of Civil Procedure.
We are in agreement with the learned Judges of the High Court that the view taken by the District Judge that as the plaintiffs were not born on the date of the sale they cannot challenge its validity is wrong.
A void sale, as we have already held the sale in execution of the decree obtained by the appellant in this case to be, confers no title on the auction purchaser and, therefore, the joint family to which the properties belonged continued to be the owners of that property and did not lose their title there to.
The plaintiffs got a right to the property as soon as they were born, not by way of succession but by right of birth.
Therefore, plaintiffs were certainly entitled to file a suit questioning the sale.
The only other argument on behalf of the appellant, which was advanced before the High Court and rejected by it and was also put forward before us, was that the plaintiffs ' suit was barred by constructive res judicata.
It appears that the appellant filed a suit O.S. No. 535 of 1944 45 for partition of items 1 15 against defendants 1 and 2 and the widow and son of another of the original judgment debtors, as also defendants 3 and 4.
To that suit the plaintiffs were not parties.
Plaintiff No. 2 was not even born then.
There Was another suit, O.S. 973 No. 47 of 1942 43 filed by the 11th defendant in respect of item 16.To that suit also the plaintiffs were not parties.
As neither plaintiff was born at the time of O.S. No. 47 of 1942 43, they having been born on 22 9 1944 and 19 9 1950, and the second plaintiff was not born at the time O.S. No. 535 of 1944 45 was filed, and the first plaintiff though born Was not made a party there can be no question of res judicata as against them.
They are not representatives of their father as contemplated in section 11 of the Code of Civil Procedure.
It also appears that the earlier suits were filed before the Munsiff 's Court and were,.
therefore, not decided by a court of competent jurisdiction as the present suit has been filed in the Subordinate Judge 's Court.
We are, therefore, satisfied that the appellant cannot succeed in his plea of res judicata.
The appeal is, therefore, dismissed.
The appellant will pay the costs of respondents 1 and 2.

summary/full:
Under s.14(1) of the Mysore Agriculturists Relief Act 1928 no agricultural land belonging to an agriculturalist shall be attached or sold in execution of any decree or order unless it has been specifically mortgaged for the payment of the debt to which such decree or order relates, The appellant filed a suit on a promissory note executed by the father of the respondents.
There was an attachment before judgment, and after decree was passed, the properties belonging to the family were sold in execution.
The res pondents were born thereafter.
They filed a suit contending that the sale of the properties in execution of the appellant 's decree was void ab initio under the Act.
The trial Court decreed the suit but the first appellate court allowed the appeal on the ground that as the respondents were not born on the date of the sale they could not challenge its validity.
The High Court restored the judg ment of the trial court.
Dismissing the appeal to this Court.
HELD ; (1) The attachment before judgment was not valid and therefore the sale in pursuance of that attachment was void.
The suit filed by the appellant was not on the foot of a mortgage and therefore the sale in execution of the appellant 's decree is against the provisions of section 14(1).
The contention that section 14(2) does no more than lay down the same procedure as 0.
38, C.P.C., and therefore the attachment is valid, is not correct.
Section 14(2) permits an attachment only in execution of a decree.
[972 B E] (2) The respondents were entitled to file the suit questioning the sale.
A void sale held in execution of a decree confers no title on the auction purchaser.
Therefore the joint family to which the properties belonged did not lose their title, but continued to be owners, and the respondents got a right to the property as soon as they were born by right of birth.
[972 E G] (3) The suit was not barred by res judicata because : (a) to the earlier suits referred to the respondents were not made parties; and (b) those suits were filed in the Munsiff 's court and were therefore not decided by a court of competent jurisdiction as the present Suit was filed in the Subordinate judge 's court.
The respondents were also not representatives of their father as contemplated in section 11, C.P.C. [972 H 973 C]