when we pay part amount of share and remaining being unpaid then company forfeit our shares.
Here why doctrine of restitution will not apply????
“The principle of restitution is also not applicable where a party is required to give someearnest money which serves as a security that the depositor will perform his part. Such depositwill not be refunded if the depositor fails to perform his promise.”
This is one of the limitations of the doctrine. However, if one can understand the straightforwardness in not returning the money to shareholders is justified. Everyone can default on calls in arrears and company will incur transaction costs. So, the amount paid by investors is forfeited and credited to capital reserves.
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