Home  /  Companies Act  /  Section 49

Section 49: Calls on shares of same class to be made on uniform basis

Companies Act • Official Statutory Text & Practice Guide

Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 2013
Section 48 All 470 Sections of Companies Act Section 50
Statutory Defined Terms in this Section: (Click any term for official legal definition)
Company Sec 2(20) Director Sec 2(34) Tribunal Sec 2(90)

Legal Commentary & Landmark Judgments: Section 49

Section 49 of the Companies Act, 2013 codifies the principle of shareholder equality by mandating that all calls for unpaid share capital must be levied on a strictly uniform basis across all shares of the same class, barring discriminatory or selective calls by company directors.

  • Mandate of Strict Uniformity: Where any calls for unpaid share capital are made on shares of a company, such calls must be made on a uniform basis on all shares falling under the same class, prohibiting selective demands on targeted shareholders.
  • Different Amounts Paid-up Exception: Under the statutory Explanation, shares of the same nominal value on which different amounts have been paid up are not deemed to fall under the same class for the purposes of Section 49, allowing differential calls to harmonize paid-up levels.
  • Fiduciary Restraint on Board Powers: The power to make calls is a fiduciary power vested in the Board of Directors, which must be exercised exclusively for the benefit of the company and not as an oppressive device to engineer forfeitures against disfavoured shareholders.
Key Landmark Precedents:
  • Galloway v. Halle Concerts Society, [1915] 2 Ch 233: Established the fundamental rule that directors exercise the power of making calls in a fiduciary capacity for the benefit of the company as a whole; a call made selectively on certain shareholders while exempting directors or favoured members is invalid and a breach of trust.
  • Shyam Chand v. Calcutta Stock Exchange Association Ltd., AIR 1949 Cal 337: The Calcutta High Court held that calls on shares must be strictly uniform and conform to the articles; any selective or discriminatory call on a section of shareholders of the same class is void and cannot sustain a subsequent forfeiture.
  • Pashupati Anantharam v. Scindia Steam Navigation Co. Ltd., (1950) 20 Comp Cas 171 (Bom): The Bombay High Court affirmed that equality of treatment among shareholders belonging to the same class is an immutable statutory principle that cannot be compromised by Board resolutions.
Courtroom Practice & Strategic Litigation Guidance:

When defending against a notice of forfeiture of shares for non-payment of calls, verify whether calls were dispatched uniformly across all members of that class. If the promoters or directors deferred payment of calls on their own holdings or failed to make concurrent calls on allied entities, plead violation of Section 49 in a Section 241 petition to obtain an immediate stay of forfeiture.

Section 48 All 470 Sections of Companies Act Section 50