1. Petition filed by Madhusoodhanan for rectification of the Company's share register under Section 155 of the Companies Act,1956 by cancellation of the allotment of 425 shares to Ravi and Srinivasan and for removal of the name of Mani from the Company's share register.
2. Company Petition filed by Kaumudi Investment Pvt. Ltd. for similar reliefs.
3. A suit filed by Madhusoodhanan in Munsif's Court, Trivandrum for decree declaring that he continued to be the Managing Director of Kerela Kaumudi and for declaration that the Board meeting held on 23-7-1986, 1-8-1986 and the meetings subsequent thereto were illegal and ultra vires the Articles of Association of the Company.
4. A suit filed by Kaumudi Investment Pvt. Ltd. against Kerela Kaumudi for similar reliefs.
5. A suit filed by Madhusoodhanan for specific performance of the third agreement.
6. Petition filed by Mani and his children for a declaration that the transfer of 390 shares by them to Madhusoodhanan pursuant to the Board's decision dated 21-5-1985 was illegal and void and for rectification of the share register by recording them as the owners of 222, 84 and 84 shares respectively.

1. Service thereof shall be deemed to be effected by properly addressing, prepaying and posting a letter containing the document, provided that where a member has intimated to the company in advance that documents should be sent to him under a certificate of posting or by registered post with or without acknowledgement due and has deposited with the company a sum sufficient to defray the expenses of doing so, service of the document shall not be deemed to be effected unless it is sent in the manner intimated by the member; and
    
2. such service shall be deemed to have been effect:
   
   1. in the case of a notice of a meeting, at the expiration of forty- eight hours after the letter containing the same is posted, and
   2. in any other case, at the time at which the letter would be delivered in the ordinary course of post.

• Every such form shall, before it is signed by or on behalf of the transferor and before any entry is made therein, be presented to the prescribed authority, being a person already in the service of the Government, who shall stamp or otherwise endorse thereon the date on which it is so presented, and
• Every instrument of transfer in the prescribed form with the date of such presentation stamped or otherwise endorsed thereon shall, after it is executed by or on behalf of the transferor and the transferee and completed in all other respects, be delivered to the company:
  1. In the case of shares dealt in or quoted on a recognized stock exchange, at any time before the date on which the register of members is closed, in accordance with law, for the first time after the date of the presentation of the prescribed form to the prescribed authority under clause (a) or within twelve months from the date of such presentation, whichever is later;
  2. In any other case, within two months from the date of such presentation.

1. which is held by a company in any other body corporate in the name of a director or nominee in pursuance of sub-section (2), or as the case may be, sub-section (3), of section 49, or
2. which is held by a corporation, owned or controlled by the Central Government or a State Government, in any other body corporate in the name of a director or nominee, or
3. in respect of which a declaration has been made to the Public Trustee under section 153B, if-

1. the company or corporation, as the case may be, stamps or otherwise endorses, on the form of transfer in respect of such share, the date on which it decides that such share shall not be held in the name of the said director or nominee or, as the case may be, in the case of any share in respect of which any such declaration has been made to the Public Trustee, the Public Trustee stamps or otherwise endorses, on the form of transfer in respect of such share under his seal, the date on which the form is presented to him, and
2. the instrument of transfer in such form, duly completed in all respects, is delivered to the-
   1. body corporate in, whose share such company or corporation has made investment in the name of its director or nominee, or
   2. company in which such share is held in trust, within two months of the date so stamped or otherwise endorsed; or

1. the State Bank of India, or
2. any scheduled bank, or
3. any banking company (other than a scheduled bank) or financial institution approved by the Central Government by notification in the Official Gazette (and any such approval may be accorded so as to be retrospective to any date not earlier than the 1st day of April, 1966), or
4. the Central Government or a State Government or any corporation owned or controlled by the Central Government or a State Government, by way of security for the repayment of any loan or advance to, or for the performance of any obligation undertaken by, such person, if-

1. the bank, institution, Government or corporation, as the case may be, stamps or otherwise endorses on the form of transfer of such share-
   1. the date on which such share is returned by it to the depositor, or
   2. in the case of failure on the part of the depositor to repay the loan or advance or to perform the obligation, the date on which such share is released for sale by such bank, institution, Government or corporation, as the case may be, or
   3. where the bank, institution, Government or corporation, as the case may be, intends to get such share registered in its own name, the date on which the instrument of transfer relating to such share is executed by it; and
2. C. the instrument of transfer in such form, duly completed in all respects, is delivered to the company within two months from the date so stamped or endorsed. any share which is held in any company by the Central Government or a State Government in the name of its nominee, except that every instrument of transfer which is executed on or after the 1st day of October, 1966 in respect of any such share shall be in the prescribed form.

• for the sale, purchase or supply of any goods, materials or services if the value of such goods and materials or the cost of such services does not exceed five lakh rupees in the aggregate in any year; or
• by a banking company for the collection of bills in the ordinary course of its business.

1. where the property is not an ordinary article of commerce, or is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market;
2. where the property is held by the defendant as the agent or trustee of the plaintiff.

1. forms a considerable part of the whole, though admitting of compensation in money; or
2. does not admit of compensation in money, he is not entitled to obtain a decree for specific performance; but the court may, at the suit of other party, direct the party in default to perform specifically so much of his part of the contract as he can perform, if the other party:
   1. in a case falling under clause (a), pays or has paid the agreed consideration for the whole of the contract reduced by the consideration for the part which must be left unperformed and a case falling under clause (b), [pays or had paid] the consideration for the whole of the contract without any abatement; and
   2. in either case, relinquishes all claims to the performance of the remaining part of the contract and all right to compensation, either for the deficiency or for the loss or damage sustained by him through the default of the defendant.

• where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in court any money except when so directed by the court;
• the plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction.

Meeting and Share Transfer Details:

• On the meeting of 19-03-1985, Mani provided that all the shares in Kerela Kaumudi owned by Mani and family would be pledged to Madhusoodhanan who shall extend financial facilities to Mani. (This evident the intention of Mani and his group to transfer their shareholding to Madhusoodhanan.)
   
• On the Board meeting of 23-04-1985, it was affirmed and resolution passed which envisaged three particulars i.e, an immediate and unconditional transfer of shares, then, the settlement of Mani's income tax liabilities by Kerela Kaumudi and further, the determination of the consideration for the transfer to be mutually agreed on. Conclusively, the meeting expressed an immediate transfer of shares where future consideration agreed.
  
  Statutory provisions represented that contract is valid even if price not fixed under Section 9 of the Sale of Goods Act, 1930 which allows the parties not to fix the price at the time of the transfer and to leave the determination of the amount of consideration to a later date, and according to Section 29 of the Contract Act, 1872 an agreement which provides for the future fixation of price either by the parties themselves or by a third party is capable of being made certain and is not invalid.
   
• In the Board meeting of 04-06-1985 share transfer deeds were approved and signed by Madhavi as Chairman. (This evident that the share transfer had been executed and duly completed.)
   
• The annual return of Kerela Kaumudi (dated 27-06-1985) filed under section 159 of the Companies act, 1956 with the Registrar of Companies, mentioned name of Mani and his children in the list of past members and debenture- holders and also included that they had effect transfer of their shareholding to Madhusoodhanan.
   
• In the statement of Form IV, ownership of newspapers, the name of Mani was not mentioned in the list of shareholders.
   
• In the annual return dated 26-09-1986 and 28-07-1987, Mani is shown as holding only one share that was sold by Ravi to Mani at a meeting held on 26-08-1986 and Madhusoodhanan as holding 612 shares in the Company. According to Section 164 of the Companies Act, 1956, the annual returns, the certificates and statement therein "shall be prima facie evidence of any matters directed or authorized to be inserted therein" under the Act.
   

1. Notice specifying the intention to propose the resolution as an extraordinary resolution must be given means the notice must inform each member of the company and it should be frank, open, clear and satisfactory.
2. Notice of the meeting must be duly given either by personal service or service by post at least 21 days before.
3. Resolution must be passed by 75% of the members present.
4. In the Case, Madhusoodhanan was Managing Director and Editor of the Company for life according to Article 74 of the Articles of Association and held 50% shares.
5. In the Board meeting dated 23-07-1986 a limited resolution was taken, namely that Madhavi "shall assume the executive powers of the Managing Director with immediate effect for effective running of the organization" and other resolution that an extraordinary general body meeting be convened at a date suitable for the chairman "to discuss and take decisions on matters arising out of above decisions".
6. Following this a notice was passed to call an extraordinary general meeting of the shareholders of Kerela Kaumudi on 16-08-1986 to consider and pass Board's resolution dated 23-07-1986 as a special resolution.
7. There was no mention in the notice of any intention or proposal to amend the Articles of the company. The explanatory statement annexed with the notice stated "special resolutions have been brought before the general body, since it is felt that the effect of the said resolutions taken by the Board and being implemented may have the effect of curbing the powers of the Managing Director vested with him by the general body." Madhusoodhanan's power not sought to be merely curbed, but completely denuded.
8. On the extradordinary general meeting dated 16-08-1986 special resolution was taken up for consideration, Madhavi submitted report "in continuation of the explanatory statement mentioned in the notice" and then proposed that "another special resolution also be passed deleting Article 74 of the Articles of Association of the Company."
9. Notice does not mention about resolution to delete Article 74 and special resolution which was proposed in the notice was not the resolution which was ultimately passed in the grab of ratifying the resolution taken by the Board of Directors on 23-07-1986, what was in fact "ratified" was not only the proposal to remove Madhusoodhanan as Director but also the immediate deletion of Article 74 of the Articles of Association of the company. Thus, the special resolution on the basis of such defective notice is insupportable in law and cannot be given effect.
10. Even, service of notice was not provided to Madhusoodhanan or any other shareholder in his group.
11. The special resolution passed by a statutory majority of 75% was sought to be circumvented by the respondents by the purported issue of additional shares to members belonging to their group.
12. It is apparent that none of the three pre condition were fulfilled for effecting an alteration in the Articles of Kerela Kaumudi by deleting Article 74.

1. Alteration of Article 74 required to be passed with 75% majority and for this it was necessary to ensure that Madhusoodhanan's shareholding which was more than 50 per cent of the paid-up share capital of the company was reduced to 25 per cent. This sought to be achieved in two stages.
• By taking decision to increase the paid-up share capital of the Company by issuing an additional 425 shares.
• By not giving Madhusoodhanan or any of his group any chance to participate in the fresh allotment of shares and ensuring that the shares were allotted to Ravi and Srinivasan.
2. Thus, on the Board meeting dated 1-08-1986 a resolution was taken to issue additional shares worth 4.25 lakh in order to increase the share capital of the company to Rs 20 lakhs.
3. Notice was directed among existing shareholders to apply for shares within seven days. The last day for making an application for allotment of any of these additional shares was fixed at seven days from the date of Board meeting so that Madhusoodhanan's shareholding could be reduced 25% before the extraordinary general meeting to be held on 16-08-1986.

• Resolution of agreement dated 16-01-1986 has 11 clauses and mentioned about Karar, signed by Madhavi, Mani, Madhusoodhanan, Srinivasan and Ravi.
   
• Clauses 1 of the Karar provides that Madhavi would be the Chairman of Kerela Kaumudi during her lifetime. Clause 2 provides that there will be no change in the existing share structure during the lifetime of Madhavi and that after the death of Madhavi, the shares of Kerela Kaumudi should be so given that Madhusoodhanan gets 50 per cent of the total shares of the Company including the shares owned by Mani, and Srinivasan and Ravi get 25 per cent each. Clause 3 provides that transfer of Mani shares to Madhusoodhanan must be informed to other parties.
  
  Clause 4 to 10 relates to the division of assets and shareholding in various family concerns so that each of the brothers had 52 per cent shareholding in different concerns. Clause 9 provides that if any shareholders in any of the concerns wishes to sell his shares, they must be offered to the 52 per cent shareholders at a price to be fixed by the others. Clause 11 provides that all pending litigation regarding the subject-matter of the Karar, should be withdrawn and that all disputes should be mutually settled, and if this is not possible the matter should be referred to an acceptable third party whose decision would be binding.
   
• Thus, each of the brothers had been given the majority of the shareholding of 52 per cent in the companies specified against their names in the Karar.
   
• Since the other three brothers of the plaintiff Madhusoodhanan had taken the full benefit of the karar, they were bound to comply with all its terms, it was not open to them to accept that portion of the karar which was in their favor and jettison the rest.
   

• Shares are movable properties and are transferable while in private companies Articles of Association restricts the shareholder's right to transfer shares and prohibit any invitations to the public to subscribe for any shares in, or debentures of, the company under Section 3(1)(iii) of The Companies Act, 1956 and Section 2(13) of the Companies Act, 1913. But, a holder of shares in a private company may agree to sell his shares to a person of his choice. Such agreements are specifically enforceable under Section 10 of Specific Relief Act, 1963, which corresponds to Section 12 of the Specific Relief Act,1877.