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Issues:
1. Allegations of misfeasance and breach of trust by managing director and director of a company. 2. Failure to take action for realization of time-barred debts. 3. Liability of directors to reimburse the company for losses. 4. Claim for interest on the amount owed. Detailed Analysis: 1. The judgment pertains to a case where a company was ordered to be wound up, and the official liquidator was appointed. Allegations were made against the managing director and director for not actively participating in the company's functioning, engaging in fraudulent acts, and acting against the company's interests. The court found them guilty of misfeasance and breach of trust in relation to the company, as per Section 543 of the Companies Act. The Supreme Court's definition of misfeasance and breach of trust was cited, emphasizing that any breach of duty resulting in loss to the company makes the director liable to reimburse the company. The respondents were held personally liable for the company's loss amounting to Rs. 4,056.77. 2. It was argued that the debts due to the company from various parties had become time-barred before liquidation, and the respondents failed to take any action for their realization. The court noted that the respondents did not initiate proceedings against debtors for recovery, allowing the debts to become time-barred. The court highlighted the duty of directors to act in the company's best interests and recover debts owed to the company, emphasizing their liability for losses incurred due to their inaction. 3. The judgment emphasized that directors are obligated to reimburse the company for losses resulting from their breach of duty. In this case, the respondents were held liable to repay the company Rs. 4,056.77 due to their failure to take action for debt recovery, leading to losses for the company. The court passed a decree for the recovery of the said amount jointly and severally against the respondents, holding them personally responsible for the company's financial loss. 4. Additionally, the petitioner sought interest on the amount owed from the date of filing the petition. The court agreed with the petitioner's claim for interest at the rate of 12% per annum from the date of the petition filing until the realization of the amount. The judgment granted the petitioner's claim for interest along with the principal amount, further establishing the respondents' liability for the financial consequences of their actions. Overall, the judgment found the respondents guilty of misfeasance and breach of trust, holding them personally liable for the company's losses and granting the petitioner's claim for interest on the amount owed.
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