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PETITIONER: TURNER MORRISON AND CO., LTD.

       Vs.

RESPONDENT: HUNGERFORD INVESTMENT TRUST LTD.

DATE OF JUDGMENT09/03/1972

BENCH: HEGDE, K.S. BENCH: HEGDE, K.S. MATHEW, KUTTYIL KURIEN

CITATION:  1972 AIR 1311            1972 SCR  (3) 711  1972 SCC  (1) 857  CITATOR INFO :  RF         1979 SC 621  (26,29)  RF         1980 SC1285  (36,38)

ACT: Estoppel--Promissory  estoppel--Scope  of--Applicability  of doctrine. Company  Law--Incorporated  Companies--Residence   of--Ultra Vires--Company  authorised  by resolution to  discharge  tax liability  of  holding company to which  dividends  due  not distributed--If ultra vires the company’s powers. Limitation   Act,  1963--Section   15(5)--Applicability   to incorporated  companies--Company--When  can be  said  to  be residing  in  India and consequently no  "absent"  from  the country.

HEADNOTE: The  rule  of estopple has gained new dimensions  in  recent years and a new class of estoppel, viz., promissory estoppel has  come to be recognised by Courts.  Where  parties  enter into  an  agreement  which  is  intended  to  create   local relations between them and in pursuance of such  arrangement on a party makes a promise to the other which he knows  will be  acted on and which is in fact acted on by  the  promise, the Court will treat the promise at finding on the  promiser to   the  extent  that  it  will  not  allow  him   to   act inconsistently with it even although the promise may not  be supported by consideration in the strict sense. [721D, 723C] Hungerford  Investment Co. owned hundred per cent shares  in Turner Morrison & Co. During the assessment years  1939-1940 to 1955-1956 the latter did not distribute dividends and the undistributed  dividends  were  utilised by  it  as  working capital.   In  all those years, the  income-tax  authorities took proceedings under s. 23-A of the Income Tax Act,  1922, and  the  deemed  dividends were assessed in  the  bands  of Hungerford.   But. year after year, from 1939 to  1954,  the Directors  of  Turner Morrison passed a  resolution  to  the effect  that it would be in-equitable to ask  Hungerford  to pay  the tax levied and that Turner Morrison  itself  should discharge that liability.  The resolutions were  implemented by  Turner  Morrison  by playing all  the,  taxes  due  from Hungerford.   If the dividends had been declared  Hungerford would  have got more than two and a half times the tax  paid

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on its behalf.  The payments were not debited to the account of  Hungerford;  nor  were  they shown  as  debts  due  from Hungerford  in  the  balance  sheets.   At  no  time  Turner Morrison  made  any demand on Hungerford  to  reimburse  the money paid.  In 1955 the control of Turner Morrison  changed hands and, thereafter, by agreement, Turner Morrison  under- took  to  discharge the tax liability of Hungerford  to  the extent  of  Rs. 46 lakhs.  In 1965 Turner Morrison  filed  a suit  against Hungerford for recovery of the tax paid.   The suit was dismissed.  In the appeal to this Court  Hungerford raised  the  plea of promissory estoppel.   Turner  Morrison urged  that  its  resolutions  were  mere  promises  to   do something  in future; they were not representations  of  any and   as   those  promises  were  not   supported   by   any consideration,  they afforded no legal basis to  resist  the claim.  Hungerford argued that the promises made under those resolutions were supported by consideration 712 in  as  much as Hungerford, in response to  those  promises, refrained  from  enforcing  the right to  have  the  profits distributed as dividends. Held,  that  by acting on the basis of.  the  representation made  by  Turner  Morrison Hungerford  placed  itself  in  a disadvantageous  position,  and  therefore,  the  pleas   of promissory estoppel had to be sustained. [122B-C] Union of India v. Indo Afghan Agencies Ltd., [1968] 2 S.C.R. 366, Central London Property Trust Ltd. v. High Trees  House Ltd., [1947] 1 K.B. 130, Combe v. Combe, [1951] 2 K.B.  215, Tool  Metal  Manufacturing Co. Ltd. v.  Electric  Co.  Ltd., [1955]  2 All E.R. 657 and Roberton V. Minister of  Pensions [1949] 1 K.B. 227, referred to. It was urged on behalf of Turner Morrison that the authority given  to it to discharge the tax liabilities of  Hungerford were  ultra  vires its powers and,  therefore,  provided  no legal basis to resist the plain, claim, Held,  that  Turner Morrison had not acted ultra  vires  its powers.  The nondistribution of the dividends had  augmented the  working  capital  of  the  company  thus  affording  it facility  to earn more profits.  Any step taken  to  augment the  working  capital of the company was  undoubtedly  inci- dental to the business of the company and, further, the same was  not for the attainment of the objects mentioned in  the memorandum.   When  Turner Morrison paid the  tax  due  from Hungerford,  in  substance,  though  not  in  form,  it  was distributing  a  portion of its assets to the 100  per  cent share  holder  of  the company,  but  without  reducing  its capital. [726H] Even  on  the assumption that the suit claim  was  otherwise good, Hungerford urged, it was barred by limitation.  It was contended  on behalf of Turner Morrison that in view  of  s. 15(5) of the limitation Act,, 1963, the claim made,  leaving aside  the claim made in respect of the assessment  for  the assessment   years  1955-1956,  was  not  barred,   because, Hungerford  was  a  non resident company  never  present  in India,  and  therefore, under the section  the  time  during which  "the defendant has been absent from India" had to  be excluded  for  the  purpose  of  computing  the  period   of limitation.  Held, that the suit was barred by limitation  : (a)  Turner Morrison had waived the lien it might  have  had over  the shares. held by Hungerford.  Hence the only  claim that Turner Morrison could have made against Hungerford  was a  money claim. (b) The suit was governed by the  Limitation Act  1963,  which fixed a period of three  years  for  money payable.   The amounts claimed, except those in  respect  of the  assessment for the assessment year 1955-1956, were  all

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paid before November 15, 1962.  Therefore, they were  barred by limitation.  So far as the payment made in respect of the assessment  year 1955-56 was concerned, Turner Morrison  had no  claim against Hungerford, because, under the amended  s. 23A  of the Income Tax Act, 1922, that liability was of  the Turner  Morrison  itself.  (c) Section 15(5)  of  the  share holders  of Turner Morrison.  Under these circumstances,  it that the provision does not apply to incorporated  companies at  all or, alternatively, that the  incorporated  companies must  be held to reside in places where they carry on  their activities  and  thus  be  present  in  all  those   places’ Factually  a  company cannot either be DM-sent in  India  or absent from India.  But it may have a domicile or  residence in India.  The Board of Directors of Hungerford used to meet in India now and then.  It was, through its representatives, attending the general meeting of the share holders of Turner Morrison.   Under  these circumstances, it must be  held  to have  been residing in’ this country and  consequently not absent from this country.  Hence s. 15(5) cannot afford  any assistance to Hurner Morrison to save the bar of limitation. [727H-728C-730C] 713 Dicey’s Conflict of Laws, New York Life Insurance Company v. Public  Trustee,  [1924]  2  Ch. 201,  Carron  Iron  Co.  V. Maclaren,  5 H.L.C. 416 and Sayaji Rao Gaikwar of Baroda  v. Madhavrao Raghunathrao, A.I.R. 1929 Bom. 14, referred to.

JUDGMENT: CIVIL APPELLATE JURISDICTION : C.A. No. 1223 of 1970. Appeal  from the judgment and decree dated  June  23rd/24th, 1969  of  the Calcutta High Court in  Appeal  from  Original Decree ,No. 203 of 1968. A.  K. Sen, Shankar Ghosh, D. N. Gupta, N. Khaitan,  Krishna Sen and B. P. Singh, for the appellant. S. V. Gupte, S. B. Mukherjee, B. N. Garg, K. K. Jain, D.  N. Sinha,  Lina Seth, M. M. N. Pombra and H. K. Puri,  for  the respondent. The Judgment of the Court was delivered by HEDGE  J.  This appeal by certificate is by  the  plaintiff- appellant,  Turner  Morrison  Co. Ltd.  (to  be  hereinafter referred  to  as  Turner Morrison) from the  decision  of  a Division  Bench  of the Calcutta High Court.   The  Division Bench  affirmed the decision of the trial  court  dismissing the plaintiff’s suit. In  the suit Turner Morrison claimed a decree for a  sum  of Rs. 1,27,67,052/16 P. The claim was made on the ground  that the  plaintiff had paid either as an agent or on  behalf  of the defendant Hungerford Investment Trust Ltd. (in voluntary liquidation)   (to  be  hereinafter  referred  to   as   the Hungerford)  a sum of Rs. 79,70,802/- as super-tax which  it was  entitled  to be reimbursed. To that sum a  sum  of  Rs. 47,96,250/16  P.  was  added as interest  in  the  shape  of damages.   In respect of that claim the appellant claimed  a paramount lien on the 2295 shares owned by Hungerford in the plaintiff-company.   The  defendant  resisted  the  suit  on Various grounds.  It denied that the plaintiff had paid  the amounts shown in the plaint-schedule or it was liable to  be reimbursed  the payments made, if any.  It also  denied  its liability  to  pay interest on the amounts that  might  have been paid.  Further’ it pleaded that the suit was barred  by estoppel, waiver and acquiescence.  It also pleaded the  bar of limitation.  In addition it pleaded that the lien claimed had  been  waived  and  that  the  suit  was  not   properly

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instituted.  According to the defendant, the .suit was not a bona  fide one.  It was one of the manipulations of  Haridas Mundhra to get at the defendants’ 2295 shares the plaintiff- company without paying for them. The trial court dismissed the plaintiff’s suit holding  that the  claim  in question was barred by  estoppel,  waiver  or acquiescence".    It  held  that  it  was  also  barred   by limitation.  It opined 714 that the liability to pay the tax in question was the  joint liability  of Turner Morrison as well as Hungerford and  the same  having been discharged by the former, it had no  claim on  Hungerford.   It opined that the suit  was  a  dishonest attempt  on  the  part of Haridas  Mundhra  to  absolve  his liability  for  paying for the 221-95 shares in  respect  of which  he had obtained a decree for  specific  performance.’ The  appellate  court affirmed some of the findings  of  the trial court. In  order  to appreciate the  various  contentions  advanced before  this Court, it is necessary briefly to refer to  the history  of the case.  Hungerford was the owner of  100  per cent  shares of Turner Morrison.  John Geoffrey  Turner  and Nigel Frederic turner (both since deceased) were the  owners of  the 100 per cent shares of Hungerford.  As can  be  seen from the records, Turner Morrison was a prosperous  company. Though that company was making enormous profits every  year, it  did  not  distribute any portion  of  those  profits  as dividends during the assessment years 1939-1940 to  1955-56. The profits that should have been available for distributing as  dividends  were  kept back by the company  and  used  as working  capital.   In  all  those  years  the,   income-tax authorities  took  proceedings under s. 23-A of  the  Indian Income-tax-  Act, 1922.  Thereafter the  "deemed  dividends" were  assessed in the hands of Hungerford.  But  year  after year the Directors of Turner Morrison passed a resolution to the effect that it would be inequitable to ask Hungerford to pay  the tax levied and that Turner Morrison  itself  should discharge  that  liability.   Those  resolutions  were  duly implemented  by Turner Morrison by paying all the taxes  due from  Hungerford.   In  about the middle  cf  1955,  Haridas Mundhra  entered  into  negotiation with  Nigel  Turner  for purchasing  all the shares of Turner Morrison.  By  exchange of  letters  in November and December  of  1955,  Hungerford agreed  to sell and Mundhra agreed to purchase 49  per  cent shares of Turner Morrison.  The agreement also provided  for an option to Mundhra to purchase from Hungerford the balance of  51 per cent shares of Turner Morrison within five  years for  the  price  agreed upon.  A formal  agreement  in  that regard was entered between Hungerford, John Geoffrey Turner, Nigel  Turner,  British,  India Corporation  (a  nominee  of Mundhra)  and Mundhra on October 30, 1956.  In pursuance  of that  agreement  Majndhra. purchased 49 per cent  shares  of Hungerford.   Thereafter as- contemplated in that  agreement Hungerford went into voluntary liqui-dation.  On October 31, 1957  two  documents came to be executed. One is a  deed  of guarantee  and indemnity.  That was a tripartite  agreement. The,  first  party to, that deed was Turner  Morrison.   The second  party was John Geoffrey Turner and  Nigel  Frederick Turner and the third party was Hungerford.  In 715 that deed after setting out the agreement between Hungerford and Mundhra, it was stated :               "NOW  THIS  DEED  WITNESSETH  that  in  consi-               deration  of  the liquidator$  having  at  the               request  of the Company (Turner Morrison)  the

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             said John Geoffrey Turner and Nigel  Frederick               ’Turner agreed (as is testified by their being               parties  to and executing these  presents)  to               distribute the assets of Hungerford in  specie               amongst the contributories of Hungerford (such               contributories  being the said  John  Geoffrev               Turner  and  Nigel Frederick  Turner)  and  in               consideration of , the premises.               1. The Company and the said John Geoffrey Tur-               ner and Nigel Frederick Turner hereby  jointly               and severally undertake to pay and/or  satisfy               all claims for or in respect of Income-tax and               Super-tax  which  is  or are  not  payable  or               recoverable  or may at any time be payable  or               recoverable under the Indian Income-tax Act by               or  from Hungerford and which payments are  in               fact legally enforced and made.               2.  The  Company and the  said  John  Geoffrey               Turner  and  Nigel  Frederick  Turner   hereby               jointly   and  severally  covenant  with   the               Liquidators  and’  ’each  of  them  that   the               company and the said John Geoffrey Turner  and               the  said Nigel Frederick Turner will  jointly               and  severally at all times  hereinafter  keep               indemnified  the Liquidators and each of  them               from  all  actions,  proceedings,  claims   or               demands  in respect of or in  connection  with               any  liability of Hungerford to Income-tax  or               Super-tax under the Indian Income-tax Act  and               also  against  all costs, damage  or  expenses               which the Liquadators or any of them may  pay,               incur  or sustain in connection  therewith  or               arising therefrom or otherwise in relation  to               the premises." The  second  document was a deed of  indemnity  between  the Turner  brothers  and Turner Morrison.  That  deed  provided that in the event of Turner Morrison "Paying in terms of the deed  of  guarantees and indemnity any sum in excess  of  46 lakhs in satisfaction of the income-tax and super-tax  which may at any time be payable or recoverable, payment of  which are  in  fact  legally enforced and made  under  the  Indian Income-tax Act by or from Hungerford the Guarantors and each of them in consideration of the premises undertake to pay to the company (,Turner Morrison) the amount of such excess  as aforesaid". 716 At  this stage, it may be mentioned that in accordance  with the  agreement entered into between Mundhra  and  Hungerford Turner  Morrison  was  to discharge  the  tax  liability  of Hungerford to the extent of Rupees 46 lakhs.  After the sale of the 49 per cent shares referred to earlier, some  dispute appears  to  have arisen between Mundhra and  Hungerford  in regard  to his option to purchase the remaining 51 per  cent shares  of the later.  Consequently Mundhra filed a suit  in the  Calcutta  High  Court  on its  original  side  for  the specific  performance of the agreement entered into  between him   and  the  Hungerford.   The  suit  was   resisted   by Hungerford.   But it was decreed.  It appears that when  the learned  trial judge was about to conclude his judgment,  in that  case  the Counsel for Mundhra requested the  court  to issue  an  injunction requiring Hungerford to  exercise  its voting rights in respect of the 51 per cent shares which was the  subject  matter  of the suit  in  accordance  with  the directions of Mundhra until the implementation of the decree for specific performance.  The learned trial judge  accepted

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that  prayer and issued the injunction asked for.  This  led to serious consequences, some of which we have dealt with in our judgment in Civil Appeal  No. 488 of 1971 which we  have just  now pronounced.  This case appears to be an  off-shoot of  that unfortunate injunction.  In the suit  for  specific performance, though Turner Morrison was a party, it did  not plead that it had any lien over the shares with which we are concerned  in this case.  By agreement between  Mundhra  and Turner  Morrison,  the later was removed from the  array  of defendants  and  the suit, proceeded against  the  remaining defendants. After obtaining the decree for specific performance and  the ,injunction  mentioned  above, Mundhra appears to  have  not been  interested  in purchasing the 51 per  cent  shares  by paying  for the same evidently because he was in a  position to have an absolute control over Turner Morrison as a result of the injunction issued.  Though Hungerford filed an appeal against  the decree in that suit, that appeal was  withdrawn for  reasons which are not clear.  After the withdrawal  of the  appeal,  by a Master’s summons dated  August  30,  1965 Hungerford  moved the trial court for fixing a time  within which  Mundhra  should purchase the 51 per  cent  shares  by paying  for  the same.  That application  was  rejected  ,on September 1965 on the ground that the application being one for  execution, it must be in a tabular form and  "that  any imposition  of time limit would be to engraft  something  on the decree which does not exist in the decree".  The  appeal against that ,order was also unsuccessful. After  the  suit  for  specific  performance  was,  decreed, Mundhra  by  himself or through Turner Morrison  appears  to have made 717 various attempts to see that Hungerford is placed in such  a position  as  not to be able to implement its  part  of  the agreement.   We have had to deal with some of those  aspects in  Civil  Appeal  488  of 1971.  Suffice  it  to  say  that according  to  Hungerford, the suit from which  this  appeal arises is one of the attempts of Mundhra in that direction. One  other  circumstance that is necessary to  be  mentioned before  proceeding to consider the points in controversy  is that despite the various resolutions passed by the Board  of Directors of Turner Morrison as well as by the  shareholders of that company at the general meeting, the present suit was filed  by  the  Secretary of Turner  Morrison  even  without obtaining the sanction of the Board of Directors.  The Board of Directors’ sanction was sought only after the defendants’ objected  to  the  maintainability of the  suit.   From  the Proceedings of the Board of Directors, it is clear that they were not even aware of the company against whom the suit was filed.   From  the two resolutions passed by  the  Board  of Directors ratifying the action taken by the Secretary, it is obvious  that  either they were callous or  they  were  mere tools in the hands of Mundhra. It  is not denied on behalf of Hungerford that the  tax  due from that company for the assessment years 1939-40 to  1955- 56  had  been discharged by Turner  Morrison.   Hungerford’s liability to pay tax arose because of the’ dividends it  was deemed to have received from Turner Morrison as a result  of s.  23-A  proceedings.   But there is  dispute  between  the parties as to the exact amount paid by Turner Morrison.   We have not thought it necessary to go into that controversy as we  have,  agreeing  with  the  High  Court,  come  to   the conclusion that the suit is not maintainable for the reasons to be presently stated. A  great  deal  of controversy centers  round  the  question

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whether when an assessment is made on the shareholders of  a company as a result of an order under s. 23-A, the company’s liability to pay    that  tax is primary or  secondary.   It was  contended on behalf of Hungerford that liability  is  a joint liability of both the   company’s  as well as that  of the  shareholders.   But  according to  the  appellant  that liability  is primarily that of the shareholders and if  the company  is  compelled to discharge that  liability,  it  is entitled  to  be reimbursed by its shareholders.   Both  the trial  judge as well as the appellate bench have upheld  the contention  of  Hungerford and have come to  the  conclusion that When Turner Morrison paid the tax due from  Hungerford, it  was  discharging its own liability under  law  and  that being  so,  it was not entitled to seek  reimbursement  from Hungerford. 718 Section  23-A  empowers the Income-tax Officer to  order  in writing  if  the conditions prescribed in that  section  are satisfied  that the undistributed portion of the  assessable income of a company earned ’in the previous year as computed for income-tax purposes and reduced by the amount of income- tax and super-tax payable by the company in respect thereof, shall  be  deemed  to have  been  distributed  as  dividends amongst  the  shareholders as on the date of  the  concerned general  meeting.  That deemed income has to be assessed  in the hands of the, shareholders either under s.23 or under s. 34 of the Indian Income-tax Act, 1922. The  two  provisos  to s. 23-A that are  important  for  our present  purpose are found in cls. (ii) and (iii) of  sub-s. (2) of s. 23-A.  Clause (ii) says :               "Where  the proportionate share of any  member               of a company in the undistributed,profits  and               gains of the, company has been included in his               total  income  under the  provisions  of  sub-               section (1) the tax payable in respect thereof               shall  be recoverable from the company, if  it               cannot be recovered from such member." Clause (iii) reads :               "  Where  tax is recoverable  from  a  company               under  this  sub-section, a notice  of  demand               shall be served upon it in the prescribed form               showing the sum so, payable, and such  company               shall be deemed to be the assessee in  respect               of such sum, for the purposes of Chapter VI." It  was urged on behalf of Hungerford that the  income  that can be brought to tax as a result of an ’order under s. 23-A is  not  a  real income; it is only a  deemed  income;  that income  came  to  be taxed because of  the  failure  of  the company to declare dividends., It is only for the purpose of convenience  that  income  is  taxed in  the  hands  of  the shareholders; hence the liability to pay that tax in  equity must be that of the company and it is for that reason s. 23- A  has provided for the realisation of the tax due from  the shareholders from the company.  The fact that before passing an  order  under  s.  23-A the  shareholders  are  not  even required to be heard was emphasised.  In this connection our attention was invited to the amendment of s. 23-A in 1955 as a result of which now the tax liable to be paid as a  result of  an  order under s. 23-A is payable  exclusively  by  the company.  In this connection reliance was also placed on the language  of s. 42 which empowers the Revenue to assess  the income of a nonresident assessee in the hands of his  agent, but  at  the same time that section empowers that  agent  to retain in his hands a sum 719

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equal to his estimated liability under that section from out of  the. non-resident’s monies in his hands.  It was  lastly urged  that if dividends were deemed to have been  declared, those deemed dividends remained in the hands of the  company and  when  the company paid tax in respect of the  same,  it must  be held to have paid the same out of the dividends  of the  shareholders that remained in its hands.  On the  other hand, it was contended on behalf of Turner Morrison that any assessment made in pursuance of an order under s. 23-A is an assessment on- the shareholders and not on the company;  The dividends  deemed to have been distributed under s. 23-A  is considered to be the income of the shareholders and not that of  the company.  It is added on to the other income of  the shareholder   for   the  purpose  of  assessment.    It   is recoverable  from the shareholder.  It is  recoverable  from the  _company  only  if  it cannot  be  recovered  from  the shareholders and the company is deemed to be an assessee  in respect of such sum for the purposes of Chapter VT only  and not  for all purposes.  Further the deemed  distribution  of dividends  as  a result of an order under s. 23-A is  in  no sense  a  real distribution of dividends which can  be  done only  by  the  shareholders at the general  meeting  of  the company.  We do not propose to pronounce on this controversy firstly because this appeal can be decided on other  grounds and  secondly for the reason that that controversy  has  now become more or less academic in view of the amendment of  S. 23-A in 1955. For the assessment years 1940-41 to 1952-53, Turner Morrison was  assessed as the, agent of Hungerford as could  be  seen from  the  assessment  orders.   For  that  reason  it   was contended  on behalf of Turner Morrison that it is  entitled to  be  reimbursed  in  respect  of  the  tax  paid  by  it. Hungerford  denies  that  Turner  Morrison  was  its  agent. According to Hungerford, the payments in question were  made by  Turner  Morrison  voluntarily and therefore  it  is  not entitled  to  claim any reimbursement.  Section  43  of  the Indian  Income-tax Act, 1922 prescribes as to who  could  be assessed as an agent under s. 42.  That section says               "Any  person  employed by or on  behalf  of  a               person residing out of the taxable territories               or  having any business connection  with  such               person, or through whom such person is in  the               receipt  of any income, profits or gains  upon               whom  the  Income-tax  Officer  has  caused  a               notice to be, served of his intention treating               him  as the agent of the  non-resident  person               shall  for  all the purposes of this  Act,  be               deemed to be such agent." It  was contended on behalf of Hungerford that it  was  not, residing  out of the taxable, territories; it is a  private, limited company:hence it must be held to be residing  in all places where it- 720 eams  or  deemed to earn any income.  It was  further  urged that  Turner  Morrison was not a person employed  by  or  on behalf  of Hungerford nor did Hungerford have  any  business connections   with  Turner  Morrison.   It  was   also   the contention of Hungerford that it did not receive any income, profits  or  gains through Turner Morrison.  Lastly  it  was urged that the Income-tax Officer had not caused any  notice to  be served upon Turner Morrison intending to  treat  that company  as the agent of Hungerford.  On the other  hand  it was Turner Morrison which had volunteered to be assessed  on behalf  of  Hungerford.  For all these reasons it  was  said that  Turner Morrison cannot be held to have been  taxed  as

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the  agent of Hungerford.  All these contentions were  taken for  the  first time in this Court.  They do not  appear  to have been taken either before the trial court or before  the appellate court.  The contentions raised involve  determina- tion   of  questions  of  fact.   In  the  plaint,  it   was specifically averred that the payments in question were made by  Turner  Morrison  as  the  agent  of  Hungerford.   That averment has not been specifically denied.  In that view, we are not called upon to go into the various submissions noted above. Before going into the other contentions, we may briefly deal with   the  contention  that  the  suit  was  not   properly instituted.   There  appears to be  basis  for  Hungerford’s contention  that  this  suit was  inspired  by  Mundhra  and Ardeshir Jivanji Hormasji, the Secretary of Turner Morrison, who  signed  the plaint on behalf of Turner Morrison  was  a mere  tool  in his hands.  There is also reason  to  believe that  when  the  Directors of  Tumer-Morrison  ratified  the action  taken by Hormasji, they behaved in an  irresponsible manner as seen earlier.  But all the same it cannot be said, the  suit  is not maintainable.  It is true that  under  the Articles  of  Association  of Turner Morrison,  a  suit  on. behalf  of that company has to be filed with the consent  of the  Directors.   But the Secretary of the  company  held  a general power of attorney from the Directors and the  action taken by him was approved by the Directors.  Hence there can be no valid objection to the maintainability of the suit. Three   important   questions  remain  to   be   considered. They .are 1. Whether the claim made by Turner Morrison is barredby the rule of estoppel, or waiver or abandonment ? 2. Whether the decision of Turner Morrison to take (over the liability of Hungerford either with or without any guarantee from Turner brothers was ultra vires its powers and 721 .lm15 3.  Whether  the  claim made in the,  suit  or  any  portion thereof is barred by limitation ? The  judgments of the trial court. and the  appellate  court have  not made any distinction between estoppel, waiver  and abandonment.   The distinction between those three  concepts is  fine but real.  In this case, there was no plea  of  any release under s. 63 of the Contract Act.  Hence the argument of Mr. A. K. Sen, learned Counsel for Turner Morrison on the scope of that section is irrelevant and we shall not go into the  same.   The  essential question  to  be  considered  is whether the facts established in this case support the  plea of  estoppel  put forward by Hungerford.  If the  answer  to that question is in the affirmative then there is no need to examine  whether  there  was any waiver  or  abandonment  as pleaded by Hungerford. ’Estoppel’  is a rule of equity.  That rule has  gained  new dimensions  in recent years.  A new class of  estoppel  i.e. promissory estoppel has come to be recognised by the  courts in this country as well as in England.  The full implication of ’promissory estoppel’ is yet to be spelled out.  We shall presently  refer  to  decisions bearing on  that  topic  but before doing so, let us examine whether Turner Morrison made any  representation  to  Hungerford, if  so,  what  is  that representation.   Further, whether Hungerford acted  on  the basis of that representation to its disadvantage.  It is not denied  that  year  after  year from  1941  to  1954  Turner Morrison passed resolutions undertaking to discharge the tax liability of Hungerford.  In pursuance of those  resolutions taxes due from Hungerford were paid.  There can be no  doubt

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that  the  steps taken by Turner Morrison  were  within  the knowledge  of Hungerford as it held 100,per cent  shares  of Turner Morrison.  The Directors of Turner Morrison must have been  its nominees.  The profit and loss accounts of  Turner Morrison  must have been approved by Hungerford  year  after year at the general meeting of that company.  In reality the Turner  brothers  were the owners of Hungerford as  well  as Turner  Morrison  though  each  of  those  companies  was  a separate  legal entity.  It may be that Turner Morrison  did not  declare dividends so that Hungerford may  avoid  paying tax  at a high rate.  But at the same time Hungerford  would not have agreed for not distributing dividends unless Turner Morrison  took over the responsibility of paying the tax  on the  dividends  deemed  to have  been  distributed.   It  is established  that if dividends had been declared  Hungerford would have got more than two and half times the tax paid  on its  behalf.  The undistributed dividends were available  to Turner  Morrison  to  be utilised  as  working  capital  and thereby  earn more profits.  The arrangement  regarding  the nondistribution of dividends as well as the payment for  the tax due from Hungerford by Turner Morrison 722 must  have  been with the consent of Hungerford as  well  as Turner ,brothers.  Those arrangements had clearly  benefited all  the  parties.  Till Mundhra entered  the  scene,  there could  not  have  been ,any  conflict  of  interest  between Hungerford  and Turner Morrison.  When Turner Morrison  paid the  tax  due from Hungerford, legal fiction apart,  it  was really  paying from the monies belonging to Hungerford.   If for  any  reason,  Turner Morrison had  not  undertaken  the responsibility to discharge the tax liability of Hungerford, the  latter could have taken steps to compel the  former  to declare  dividends  or even compel it to go  into  voluntary liquidation.  Hence there can be no doubt that by acting  on the  basis  of the representation made by  Turner  Morrison, Hungerford had placed itself in a disadvantageous position. But  it  was  urged on behalf of Turner  Morrison  that  the resolutions  in question were mere promises to do  something in  the future : They were not representations of  any  fact and   as   those  promises  were  not   supported   by   any consideration,  they  afford no legal basis  to  resist  the claim  made  in the plaint.  Hungerford’s answers  to  these contentions  are,  that firstly those resolutions  afford  a good  basis  for  raising a  plea  of  promissory  estoppel; secondly those representations became representation of fact as soon as the tax liability of Hungerford was discharged by Turner  Morrison in pursuance of its resolutions and  lastly the promises made under those resolutions were supported  by consideration  inasmuch as Hungerford in response  to  those promises  refrained  from enforcing its right  to  have  the profits  distributed  as  dividends.   Now  coming  to   the payments  made after 1955, it is seen that according to  the agreement  between Turner Morrison, Hungerford and  Mundhra, Turner Morrison was required to set apart a sum of Rupees 46 lakhs   to  discharge  the  tax  liability  of   Hungerford. Accordingly Turner Morrison transferred Rupees 46 lakh  from its  general reserve to a special reserve.  Further  by  the agreements  dated  October 31, 1957 set out  earlier  Turner Morrison  took over the entire tax liability  of  Hungerford and t he Turner brothers agreed to reimburse Turner Morrison any payment made on behalf of Hungerford in excess of Rupees 46  lakhs.   All these arrangements clearly  enured  to  the benefit  of  Turner  Morrison inasmuch as  it  allowed  that company to refrain from declaring dividends and utilise that money for business purposes.  There can be no doubt that it

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was  done  in the best interest of that company and  with  a view to further its business interests. It is necessary to note that despite Turner Morrison  paying the  tax  due from Hungerford from 1941 uptill  1953,  those payments were not debited to the account of Hungerford;  nor were they shown as debts due from Hungerford in the  balance sheets  placed before the general meeting.   Those,  balance sheets were approved by the general meeting.  It was plainly admitted by the 723 witnesses  examined/ on behalf of Turner Morrison  that  the ,amounts paid on behalf of Hungerford were not considered as debts  due from that company till about the time  of  filing the suit. ,In the general meeting of Turner Morrison held on March  29,  1956,  the  recommendation  of  the  Board of Directors  to  transfer  Rupees 46 lakhs  from  the  general reserve  to  a  special reserve for  The  purpose  mentioned earlier  was approved.  Thereafter Turner Morrison paid  the tax due from Hungerford for the assessment year 1952-53  and debited  the  same to that special  reserve.   While  Turner Morrison was keeping Hungerford informed of the  assessments made  on it and the refunds ordered, at no time it made  any ,demand  on  Hungerford to reimburse the  moneys  paid.   On several  occasions Turner Morrison entered  into  agreements with  the .President of India undertaking to  discharge  the tax  liabilities  of  Hungerford  upto  an  agreed  maximum. Turner  Morrison  was  representing Hungerford  in  all  the assessment proceedings It used to file appeals on behalf  of Hungerford  against the orders of the  Income-tax  Officers. It had received all the amounts ordered to be refunded.   It was keeping Hungerford informed of the various orders passed by  the Income-tax authorities, but yet without  making  any demand  for  the payment of tax paid by it.   The  documents produced  in  the  case  and  the  admissions  made  by  the witnesses  examined  on behalf of Turner  Morrison  make  it abundantly clear that the idea of claiming back the tax paid on  behalf  of Hungerford came to be entertained  by  Turner Morrison  only after Mundhra came to control  that  company. With  this  background let us now  consider  whether  Turner Morrison is estopped from making the claim in question. In  support of its case Hungerford relies primarily  on  the doctrine of Promissory Estoppel.  This doctrine has  assumed importance  in recent years though it was dimly  noticed  in some of the earlier cases.  The leading case on the  subject is  Central London Property Trust Ltd. v. High  Trees  House Ltd.(1). The facts of that case are as follows : Central  London  Property Trust Ltd. let to the  High  Trees House Ltd., a subsidiary of the former a block of flats  for a term of 99 years from September 29, 1937 at a ground  rent of  pound 2500 a year.  In the early part of 1940, owing  to war  conditions then prevailing only a few of the  flats  in the  block were let to tenants and it became  apparent  that the  High Trees House Ltd. would be unable to pay  the  rent reserved  by  the  lease  out of  the  rent  of  the  flats. Discussions  took  place between the ’Directors of  the  two companies  and as a result on January 3, 1940, a letter  was sent by the lessor to the lessee confirming that the  ground rent of the (1) [1947] 1 K.B. 130. 724 premises  would be reduced from X- 2500 to X- 1250  as  from the  beginning of the term.  The lessee thereafter paid  the reduced rent.  By the beginning of 1945, all flats were  let but  the lessee continued to pay only the reduced rent.   In September  1945,  the lessor wrote to the  lessee  demanding

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rent  at the rate of pounds 2500 per year.  It also  claimed at  that  rate  for the quarters  ending  September  29  and December  25, 1945.  The lessee repudiated that claim.   The question  for decision was whether the lessor was  bound  by the  concession that it had agreed to show as the  same  was not supported by any consideration.  Answering that question Denning  J. (as he then was) held that where  parties  enter into  an  agreement  which  is  intended  to  create   legal relations between them and in pursuance of such  arrangement one  party makes a promise to the other which he knows  will be  acted on and which is in fact acted on by  the  promise, the court will treat the promise as binding on the  promiser to   the  extent  that  it  will  not  allow  him   to   act inconsistently with it even although the promise may not  be supported by consideration in the strict sense.  Therein the court divided the claim made in the suit into two categories one  for the period prior to the end of 1945 and  the  other for  the period thereafter.  It disallowed the claim of  the lessor  in  respect  of the former  and  allowed  the  claim relating to the later period. The  rule laid down in High Trees case(1) again came up  for consideration before the King’s Bench in Combe v.  Combe(2). Therein  the court ruled that the principle. stated in  High Trees’  case(1) is that, where one party has,, by his  words or  conduct, made to the other a promise or assurance  which was intended to affect the legal relations between them  and to  be acted on accordingly, then, once the other party  has taken  him at his word and acted on it, the party  who  gave the  promise  or assurance cannot afterwards be  allowed  to revert  to  the previous legal relationship as  if  no  such promise  or  assurance  had been made by him,  but  he  must accept  their legal relations subject- to the  qualification which  he himself has so introduced, even though it  is  not supported in point of law by any consideration, but only  by his  word. But that principle does not create any  cause  of action which did not exist before; so that, where a  promise is  made  which is not supported by any  consideration,  the promises  cannot  bring  an  action on  the  basis  of  that promise.-  The  principle  enunciated  in  the  High  Trees’ case(1)  was also recognised by the House of Lords  in  Tool Metal  Manufacturing  Co.  Ltd.  v.  Tungsten  Electric  Co. Ltd.(3).  That principle was adopted by this Court in  Union of India v. Indo Afghan Agencies Ltd(4).  The facts of  that case, in brief, are as follows (2) [1951] 2  K.B. 215. (1) [1947] 1 K.B.130 (3) [1955] 2 All E.R.657 (4) [1968] 2. S.C.R. 366. 725 In  exercise  of its powers under S. 3 of  the  Imports  and Exports  (Control) Act, 1947, Central Government issued  the Imports  (Control) Order, 1955 and other orders setting  out the  policy  ,governing  the  grant  of  import  and  export licences.   The  Central Government also evolved  an  Import Trade Policy, to facilitate the mechanism of the Act and the orders  issued thereunder, and it was modified from time  to time by issuing fresh Schemes in respect of new commodities. In  1962,  the  Central Government  promulgated  the  Export Promotion  Scheme  providing  incentives  to  exporters   of woolen textiles and goods.  It provided for the grant to  an exporter  certificates  to import raw materials of  a  total amount  equal  to 100% of the F.O.B. value of  his  exports. Clause   10  of  the  scheme  provided  that   the   Textile Commissioner could grant an import certificate for a  lesser amount  if he is satisfied, after holding an  enquiry,  that

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the-declared value of the goods exported is higher than  the real value of the goods.  The Scheme was extended to exports of  woolen textiles and goods to Afghanistan.   M/s.   Indo- Afghan  Agencies Ltd. exported woolen goods  to  Afghanistan and  were  issued an Export Entitlement Certificate  by  the Textile  Commissioner not for the full F.O.B. value  of  the goods exported but for a reduced amount on the basis of some private  enquiry supposed to have been held by him  but  not after holding an enquiry as contemplated by the Scheme.  The representation made by the Indo-Afghan Agencies in that con- nection to the Central Government was rejected.   Thereafter M/s.  Indo-Afghan Agencies Ltd. moved the High Court to  set aside  the  order  of  the  Textile  Commissioner  and   the government  and  to  issue  a direction  to  them  to  grant licences for an amount equal to 100% of the F.O.B. value  of their  exports.  That prayer was resisted by the  government on  various grounds, inter alia, that the  Export  Promotion Scheme  was administrative in character, that  it  contained mere executive instructions issued by the Government to  the Textile  Commissioner and created no enforceable  rights  in the  exporters who exported their goods in pursuance of  the scheme  and  it imposed no obligation on the  government  to issue  import certificates.  The High Court and  later  this Court  in appeal rejected that contention.  This Court  held that  the government is not exempt from liability  to  carry out the representation made by it as to its future  conduct. In arriving at that conclusion this Court placed reliance on the  decision  of  Denning J. in Robertson  v.  Minister  of Pensions(1).   Therein (Denning J.) was dealing with a  case of,  serving  army  officer  who wrote  to  the  War  Office regarding  a  disability  and received  a  reply  that  his: disability  had been accepted as attributable  to  "military service".  Relying on that assurance he forbore to obtain an independent medical opinion.  The Minister of Pensions later decided that his (1) [1949] 1 K.B. 227. 726 disability could not be attributed to War Service.   Therein the  court  held  that  as  between  the  subjects  such  an assurance would be enforceable because it was intended to be binding,  intended  to be acted upon and was in  fact  acted upon,.  and  the assurance was also binding  on  the  ground because  no  term  could be implied that the  Crown  was  at liberty  to revoke.  The rule laid down in  these  decisions undoubtedly  advance the cause of justice and hence we  have no hesitation in accepting it. It was urged on behalf of Turner Morrison that the authority given  to it to discharge the tax liabilities of  Hungerford as well as the agreements entered into by it with Hungerford and  the  Turner brothers were ultra vires its  powers,  and consequently  they  provide  no legal basis  to  resist  the plaint claim.  It is true that a Private Ltd. company cannot exceed  the powers conferred on it under its  Memorandum  of Association.   Therefore,  for  considering  whether  Turner Morrison was competent to undertake the liability it did, we have  to look to the provisions in the  Memorandum.   Clause 3(b) of the Memorandum empowers the Turner Morrison to carry on  business  in India and elsewhere as  merchants,  general merchants,  agents and traders etc.  Sub-clause (q) of  that clause  gives  power to , the company "to receive  money  on deposit at interest or otherwise and lend money to such per- sons, with or without security and on such terms as may seem expedient  and  in  particular to  customers  of  and  other persons  having  dealing with the company and  to  give  any guarantee or indemnity as may seem expedient."

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             Sub-cl. (x) authorises the company               "to  distribute  among  the  members  of   the               company in specie any property of the Company,               but  no distribution amounting to a  reduction               of capital shall be made without the sanction,               if any, for the time being required by law."               Sub-cl.  (z) authorises the company to do  all               such   other  things  as  are  incidental   or               conducive  to the attainment of  objects  men-               tioned in Memorandum. As  seen earlier the non-distribution of the  dividends  had augmented the working capital of the company thus  affording it facility to earn more profits.  Any step taken to augment the working capital of the company is undoubtedly incidental to  the  business of the company and further  the  same  was conducive to the attainment of the objects mentioned in  the Memorandum.   When  Turner Morrison paid the  tax  due  from Hungerford  in  substance,  though  not  in  form,  it   was distributing a portion of its 727 assets  to the 100 per cent shareholder of the  company  but without  reducing its capital.  Hence we are unable  to  see how  it  can be said that Turner Morrison  had  acted  ultra vires its powers.  Mr. A. K. Sen, learned Counsel for Turner Morrison invited our attention to several decisions  wherein the courts had taken the view that the actions taken by  the companies  concerned were ultra vires their  powers.   Those decisions  were  rendered  on  the  facts  of  those  cases. Whether a transaction entered into by a company can be  said to  be  within its powers or not has to be  decided  on  the basis  of  the facts established and the provisions  in  its Memorandum and not on the basis of any abstract rule. The  only  other question that remains to be  considered  is whether  the suit claim is barred by limitation even on  the assumption   that   claim  is  otherwise  in   order.    For pronouncing  on  this  question, it is  first  necessary  to decide whether Turner Morrison had waived its lien over  the shares  held  by  Hungerford.  There can be  no  doubt  that Turner Morrison has the power to waive the paramount lien it has  upon  all  the shares registered in the  name  of  each member,  for his debts or liabilities to the company.   That much  is clear from art. 22 of the Articles of  Association. That article provides that               "Unless  otherwise agreed the registration  of               transfer  of shares shall operate as a  waiver               of  the  Company’s  lien (if  any)  upon  such               shares." In  Buckley on Companies Acts (13th Edn. at p. 797)  dealing with the question of lien, it is observed               ".......For  such  a  provision  is  for   the prote ction of the company, and is capable of               being waived by the company.  " We  have to see whether the company in fact had  waived  the lien it had in respect of the suit claim, assuming that  the said claim is otherwise good.  As seen earlier at all stages Turner  Morrison took over the responsibility of paying  the tax  due  on  behalf of Hungerford.  There was  no  idea  of recovering  the amount paid as tax, from  Hungerford.   When Hungerford  sold 49 per cent of its shares to  Mundhra,  the same  was registered without any objection.  It was  clearly admitted  by  the  Secretary of Turner  Morrison  and  other witnesses  examined on behalf of that company that the  idea of  suing  Hungerford for recovering the tax paid  was  con- ceived for the first time after Mundhra obtained the  decree for  specific  performance.  Under these  circumstances,  it

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is.clear  that Turner Morrison had waived the lien  that  it might  have had over the shares held by  Hungerford.   Hence the only claim that Turner Morrison could have made  against Hungerford was a money 728 claim.   The  present suit was filed on November  15,  1965. Hence  it is governed by the provisions of  the  ’Limitation Act,  1963 which came into force on April 1, 1964.   Article 23 of that Act fixes a period of three years for instituting a  suit "for money payable to, the plaintiff for money  paid for  the  defendant" and the cause of action  for  the  same comme nces  when the money is paid.  To the same effect  was Art. 63 of the Limitation Act, 1908.  The amounts claimed in the  present suit except those in respect of the  assessment for  the  assessment year 1955-56 were all  admittedly  paid before November 15, 1962.  Hence they are prima facie barred by  limitation.  So far as the payments made in  respect  of the assessment for the assessment year 1955-56 is concerned, Turner  Morrison  can  have  no,  claim  against  Hungerford because  under  the amended s. 23-A of the  Income-tax  Act, 1922,  that  liability was that of Turner  Morrison  itself. But  it was urged on behalf of Turner Morrison that in  view of  s. 15 (5) of the Limitation Act, 1963, the  claim  made, leaving  aside the claim made in respect of  the  assessment for  the  assessment year 1955-56, is  not  barred.  Section 15(5) prescribes :               "In computing the period of limitation for any               suit  the time during which the defendant  has               been   absent   from  India   and   from   the               territories    outside   India    under    the               administration of the Central Government shall               be excluded." It was urged on behalf of Turner Morrison that Hungerford is a non-resident company.  Therefore it cannot be said that at any  time  it was present in India.  Hence the suit  is  not barred.   If this argument is correct then there can  be  no period  of  limitation  for filing a  suit  against  a  non- resident   company  a  proposition  which  is  prima   facie startling.  Can we hold ’that s. 15(15) applies to a suit of the  type  with  which we are  concerned  ?  That  provision contemplates  the  case of a defendant who has  been  absent from India.  That article presupposes that defendant was  at one time present in India and later he has been absent  from India.  A person who was never in India cannot be considered ,is  having  been absent from India.   Factually  a  company cannot either be present in India or absent from India.  But it  may  have a domicile or residence  in  India.   Sometime questions  have arisen as to what is the place of  residence of  an incorporated company.  Dicey in his Conflict of  Laws (4th  Edn.  p.  152 rule 19)  pointing  out  the  difference between  the  domicile  of a natural person and  that  of  a corporation, says :               "The domicil of a human ’being is a fact which               on certain points,, subjects him to the law of               a  particular  country.   The  domicil  of   a               corporation is a fiction suggested by the fact               that a corporation is, on certain points, 729               e.g., the jurisdiction of the Courts,  subject               to,  the law of a particular country.  A  man,               that is to say, is in some respects subject to               the  law of England because he has in fact  an               English domicil; a corporation is by a fiction               supposed  to  have  an  English  residence  or               domicil  because  it is  in  certain  respects

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             subject  to  the  law  of  England.   Hence  a               corporation  may  very  well  be,   considered               domiciled  or resident, in a country  for  one               purpose  and not for another, and hence,  too,               the  great uncertainty as to the  facts  which               determine  the  domicil,  or  residence  of  a               corporation.   In  each  case  the  particular               question   is  not,  at  bottom,   whether   a               corporation   has  in  reality   a   permanent               residence   in  a  particular   country,   but               whether, for certain purposes (e.g. submission               to the jurisdiction of the Courts or liability                             to taxation), a corporation is to be c onsidered               as  resident  in  England  or  in  some  other               country." The   question  of  residence  of  an insurance   company registered  and  having its registered office in  a  foreign country  came  up  for  consideration  before  the  Chancery Division  in  New  York Life  Insurance  Company  v.  Public Trustee(1).  There in Pollock M.R. quoted with approval  the following passage from the judgment of Lord St. Leonards  in Carron Iron Co. v. Maclaren(2).               "I  think  that this company may  properly  be               deemed  both Scotch and English.  It may,  for               the  purposes  of jurisdiction, be  deemed  to               have   two   domiciles.    Its   business   is               necessarily carried on by agents, and I do not               know why its domicile should be considered  to               be  confined to the place where the goods  are               manufactured... There may be two domiciles and               two jurisdictions; and in this case there are,               as I conceive, two domiciles and a double sort               of  jurisdiction, one in Scotland and  one  in               England;  and for the purpose of  carrying  on               their business, one is just as much a domicile               of the corporation as the other." The same view was expressed in that case by Warrington  L.J. and Atkin L.J. A  division  bench of the Bombay High Court  in  Sayaji  Rao Gaikwar of Baroda v. Madhavrao Raghunathrao(3) dealing  with the  scope  of  s. 13 of the Limitation Act  1908  which  is identical  with the resent s. 15(5) held that s. 13 must  be read  so, as to avoid the obvious absurdity that  arises  if such corporate bodies (1) [1924] 2. Ch. 201. (3) A.I.R. 1929 Bom. p. 14. (2) 5, H.L.C. 416. 730 are  deemed  to reside out of British India  so  that  suits against  them can never be barred at all.  And this  can  be done by treating them as defendants, who by reason of their special character, are not absent from British India  within the  meaning of the section, because they have not  got  the same liberty as private individuals to reside personally  in British  India and attend to their affairs and they must  do so   through   agents  or  representatives.    Under   those circumstances,  they can be held to reside in British  India in  so far as they actually carry on business through  their representatives in British India. Section  15(5) of the Limitation Act, 1963 can be viewed  in one o f the two ways i.e. that that provision does not apply to  incorporated companies at all or alternatively that  the incorporated  companies  must be held  to-reside  in  places where they carry on their activities and thus being  present

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in  all those places.  Hungerford is an Investment  company. It  had  invested large sums of monies in  Turner  Morrison. Its  Board of Directors used to meet in India now and  then. It was, (through its representatives) attending the  general meeting of the shareholders of Turner Morrison.  Under these circumstances, it must be held to-have been residing in this country  and consequently was not absent from this  country. Hence  s.  15(5)  cannot afford  any  assistance  to  Turner Morrison to save the bar of limitation. For the reasons mentioned above, this appeal fails and it is dismissed.  Turning to the question of costs, ’from what  we have   said  earlier,  it  is  clear  that  there   was   no justification  for bringing the suit.  The suit was  clearly engineered by Mundhra to attain certain ulterior purposes of his.    But   unfortunately  neither  he   no   his   likely collaborators the Directors, of Turner Morrison, are  before us.   The only accessory of Mundhra who is before us is  the Secretary  of  Turner  Morrison,  Hornasji.   There  is   no justification  to make Turner Morrison in which Mundhra  has only  49  per  cent  shares  to  bear  the  costs.   In  the circumstances, we think it proper to direct Hormasji to bear the costs of both the parties in this Court.  The order made by the High Court as regards costs will stand. K.B.N.                                     Appeal dismissed. 731