1992 (5) TMI 169 - HC - Companies Law

Winding up Statement of affairs to be made to official liquidator, Application by official liquidator under section 454(2)

Summary

Issues:
Non-filing of statement of affairs within statutory period under Companies Act.

Analysis:
The judgment pertains to the prosecution of directors of a company for failing to file the statement of affairs within the statutory period following a winding-up order. The official liquidator sought prosecution under section 454(5) of the Companies Act. The court examined evidence including oral testimonies and documents. The notice for filing the statement was served on the directors, as evidenced by the official liquidator's testimony and receipts proving receipt of notices. The respondents denied receiving the notice but did not challenge the signatures on the receipts. The court found that notices were served, establishing the directors' knowledge of the requirement. The respondents handed over some documents to the official liquidator but failed to file the statement of affairs until May 1991.

The court rejected the respondents' defense that they lacked knowledge of the winding-up order, as notices were served before the order and published. The directors were aware of the official liquidator's appointment by December 1990. The court emphasized that the duty to file the statement of affairs lies with the directors, not the official liquidator. The statutory requirement mandates filing within 21 days of the official liquidator's appointment, with a possible extension up to three months. The directors failed to seek an extension or file the statement within the prescribed period, despite producing some records to the official liquidator.

The court held the respondents accountable for the delayed filing, imposing a penalty of Rs. 100 per day for the period of non-compliance, totaling Rs. 13,200 for each director. The judgment underscores the directors' obligation to adhere to statutory timelines and fulfill their duties in liquidation proceedings. Despite the respondents' knowledge of the winding-up order and the official liquidator's appointment, their failure to file the statement of affairs within the stipulated period led to the penalty. The court's decision highlights the importance of timely compliance with legal obligations in company liquidation processes to ensure transparency and accountability.