The undisputed facts of the case are: The shares of the Company 887 were held by Davids or their nominees till they were transferred to Tatas; that according to the valuation made by the auditors of the Company, its assets were worth Rs. 155 lacs as on December 31, 1955; that at a meeting of the directors held on December 2, 1955, it had been resolved that the services of 22 employees should be terminated by paying retrenchment compensation; that on January 25, 1956 at the extra ordinary general meeting of the shareholders of the Company, it was resolved that the employees of the Company be paid certain sums or annuity set out against the names of each of them and their services should be terminated with effect from April 1, 1956; that an agreement was entered into between Davids and Tatas on March 23, 1956 regarding the sale of the shares in favour of the Tatas; that the said agreement referred to the resolution passed at the meeting of the shareholders of the Company; that the Company paid retrenchment compensation according to the said resolution and that the Tatas deducted from the purchase price the sum payable by the Company in accordance with the resolution of the Company from out of the consideration of Rs. 155 lacs which they had agreed to pay under the agreement dated March 23, 1956 to Davids.