Case: K.S.E.B Vs. Hindustan Const. Co.Ltd.

the chairman of the previous meeting or indeed even present at the meeting of which the minutes are a record. His action in signing them is merely to record that they are a correct record of the business transacted. There may however be occasions where the Chairman although having no reason to question the accuracy of the record, refuses to sign the minutes. In such cases a record should be made in the minutes to the effect that the minutes of the previous meeting were correct. 31. If there is a considerable interval between meetings, the chairman can sign the minutes as soon as they have been prepared: this power is useful too when the minutes are needed to confirm to third parties that a particular decision has been made. 32. In Chetkar Jha v. Viswanath Prasad Verma and Ors. (1971 (1) SCR 586 ) it was noted inter alia as follows: "The question then is whether the minutes, as drafted and placed before the meeting on July 3, 1963, could be altered as was done on that day. The alteration clearly was not of a minor or a clerical error but constituted a substantial change. Minutes of a meeting are recorded to safeguard against future disputes as to what had taken place thereat. They are a record of the fact that a meeting was held and of the decision taken thereat. Usually they are written up after the termination of the meeting, often from rough notes taken by the person who is to draft them and then are placed before the next meeting for what is generally known as "confirmation", though they are placed for verification and not for confirmation. Indeed, there is no question of any confirmation at the next meeting of a decision already taken, for, a decision once taken does not require any confirmation. Accordingly, when minutes of a meeting are placed before the next meeting only thing that can be done is to see whether the decision taken at the earlier meeting has been properly recorded or not. The accuracy of the minutes and not the validity of the decision is, therefore, before the meeting. Once a decision is duly taken it can only be changed by a substantive resolution properly adopted for such a change. When, therefore, a decision is taken and is minuted and such minutes are signed by the Chairman they become prima facie evidence of what took place at the meeting. In the case of company meetings, every meeting of directors or managers in respect of whose proceedings minutes have been so made is deemed to have been properly held and convened and all proceedings had there to have been duly had and all appointments of directors, managers or liquidators are deemed to be valid unless the contrary is proved. (cf. Halsburys Laws of England, 3rd Edn. vol. 6, p. 318). This is the position when minutes have been signed by the Chairman. After such signature they cannot be altered. But before the minutes are signed they can be altered if found to be inaccurate or not in accord with what was actually decided. If that were not to be so, it would result in great hardship and inconvenience, for, however, inaccurate they are, they cannot be altered to bring them in conformity with the actual decision. [of. Talbot, W.F., Company Meetings, (1951 ed. P.82). This was precisely what was done at the meeting of July 3, 1963 and no objection to the course adopted then by the Chairman and the Syndicate could be validly taken particularly as none present then had raised any protest against the alteration. The decision relied on by Mr. Jha in In re Botherham Alum and Chemical Company (1884 (25) Ch.D.p.103) is altogether on a different question and cannot be of any assistance. Since the Vice-Chancellor was right in his understanding that what had been decided at the meeting of May 7, 1963 was not to accept the Commissions recommendation and since such refusal to accept meant under Section 26(4) that the matter should be sent back to the Commission for recommendation, his action in asking the Commission to reconsider clearly fell under Section 26(4) and could not be said to be unwarranted as the Chancellor ruled. Since that was actually the decision of the Syndicate, the Vice-Chancellor was bound to follow it up by writing to the Commission to reconsider its recommendation. It is somewhat difficult to appreciate the Chancellors observation that that action was unwarranted as it was without the Syndicates sanction. Once the Syndicate had taken the decision of not accepting the recommendation, it was obligatory under s. 26(4) to refer back the matter to the Commission. The action taken by the Vice-Chancellor was consequential and required no further sanction of the Syndicate. Equally unsustainable was the view of the Chancellor that the alteration in the minutes on July 3, 1963 constituted a revision or a recission of the earlier decision or that such revision or recission could not be made before the expiry of six months as provided by the rule passed by the Syndicate in 1952. In our view, the revised advertisement, the remission of the matter to the Commission, the recommendation of respondent 1 by the Commission and the proceedings of the Syndicates meeting of July 3, 1963 including the revision of the draft minutes were all in accordance with the provisions of the Act and the University Statutes and therefore the Chancellor had no jurisdiction under Section 9(4) of the Act to annul the decision of the Syndicate or the proceedings of the meeting of July 3, 1963". 33. Above being the position, the High Courts view that the decision taken on 30.4.1994 has to be given effect to cannot be faulted. As rightly submitted by learned counsel for the respondents non confirmation of minutes does not have any effect on the decision taken at the earlier meeting. The position has been illuminatingly stated in Chetkar Jhas case (supra).

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]23. If one reads the minutes of 30.4.1994 which were not confirmed at the meeting held on 30.5.1994 it is clear that it was merely noted that the Board decided to discuss the issue further. The High Court rightly took note of the fact that nothing happened for a long time. Counter affidavit was filed stating that the Board has not finally accepted the recommendations of the Ad hoc Committee for payment of Rs.808.26 lakhs as it was under no legal obligation to implement the order. The Committee was constituted by the appellant-Board. The varying stands, taken at different points of time show that the object was to avoid payment. The Ad hoc Committee which was appointed consisted of experts in the fields and also Additional Secretary and Under Secretary to the Government. Twenty one sittings were held, site visits were made and voluminous documents were considered. After a very detailed consideration of the whole matter, recommendations were made for making payment of Rs.808.26 lakhs as against claim of Rs.1688.08 lakhs by the respondents. The Board constituted another Sub-Committee consisting of two members, one of whom was the Convener and representative of the Board in the Ad hoc Committee. After considering the recommendations and the report the Board decided to make payment of Rs.250 lakhs as an interim payment. On 30.4.1994 unanimously a decision was taken to pay Rs.808.26 lakhs as noted by the Ad hoc Committee.In Chetkar Jha v. Viswanath Prasad Verma and Ors. (1971 (1) SCR 586 ) it was noted inter alia asquestion then is whether the minutes, as drafted and placed before the meeting on July 3, 1963, could be altered as was done on that day. The alteration clearly was not of a minor or a clerical error but constituted a substantial change. Minutes of a meeting are recorded to safeguard against future disputes as to what had taken place thereat. They are a record of the fact that a meeting was held and of the decision taken thereat. Usually they are written up after the termination of the meeting, often from rough notes taken by the person who is to draft them and then are placed before the next meeting for what is generally known as "confirmation", though they are placed for verification and not for confirmation. Indeed, there is no question of any confirmation at the next meeting of a decision already taken, for, a decision once taken does not require any confirmation. Accordingly, when minutes of a meeting are placed before the next meeting only thing that can be done is to see whether the decision taken at the earlier meeting has been properly recorded or not. The accuracy of the minutes and not the validity of the decision is, therefore, before the meeting. Once a decision is duly taken it can only be changed by a substantive resolution properly adopted for such a change. When, therefore, a decision is taken and is minuted and such minutes are signed by the Chairman they become prima facie evidence of what took place at the meeting. In the case of company meetings, every meeting of directors or managers in respect of whose proceedings minutes have been so made is deemed to have been properly held and convened and all proceedings had there to have been duly had and all appointments of directors, managers or liquidators are deemed to be valid unless the contrary is proved. (cf. Halsburys Laws of England, 3rd Edn. vol. 6, p. 318). This is the position when minutes have been signed by the Chairman. After such signature they cannot be altered. But before the minutes are signed they can be altered if found to be inaccurate or not in accord with what was actually decided. If that were not to be so, it would result in great hardship and inconvenience, for, however, inaccurate they are, they cannot be altered to bring them in conformity with the actual decision. [of. Talbot, W.F., Company Meetings, (1951 ed. P.82). This was precisely what was done at the meeting of July 3, 1963 and no objection to the course adopted then by the Chairman and the Syndicate could be validly taken particularly as none present then had raised any protest against the alteration. The decision relied on by Mr. Jha in In re Botherham Alum and Chemical Company (1884 (25) Ch.D.p.103) is altogether on a different question and cannot be of any assistance. Since the Vice-Chancellor was right in his understanding that what had been decided at the meeting of May 7, 1963 was not to accept the Commissions recommendation and since such refusal to accept meant under Section 26(4) that the matter should be sent back to the Commission for recommendation, his action in asking the Commission to reconsider clearly fell under Section 26(4) and could not be said to be unwarranted as the Chancellor ruled. Since that was actually the decision of the Syndicate, the Vice-Chancellor was bound to follow it up by writing to the Commission to reconsider its recommendation. It is somewhat difficult to appreciate the Chancellors observation that that action was unwarranted as it was without the Syndicates sanction. Once the Syndicate had taken the decision of not accepting the recommendation, it was obligatory under s. 26(4) to refer back the matter to the Commission. The action taken by the Vice-Chancellor was consequential and required no further sanction of the Syndicate. Equally unsustainable was the view of the Chancellor that the alteration in the minutes on July 3, 1963 constituted a revision or a recission of the earlier decision or that such revision or recission could not be made before the expiry of six months as provided by the rule passed by the Syndicate in 1952. In our view, the revised advertisement, the remission of the matter to the Commission, the recommendation of respondent 1 by the Commission and the proceedings of the Syndicates meeting of July 3, 1963 including the revision of the draft minutes were all in accordance with the provisions of the Act and the University Statutes and therefore the Chancellor had no jurisdiction under Section 9(4) of the Act to annul the decision of the Syndicate or the proceedings of the meeting of July 3, 1963".Above being the position, the High Courts view that the decision taken on 30.4.1994 has to be given effect to cannot be faulted. As rightly submitted by learned counsel for the respondents non confirmation of minutes does not have any effect on the decision taken at the earlier meeting. The position has been illuminatingly stated in Chetkar Jhas case (supra).