2004 (2) TMI 370 - HC - Companies Law

Summary

Issues: Application under section 446(2) of the Companies Act, 1956 for permission to remain out of winding-up proceedings.

Analysis:
1. The applicant, a secured creditor of the company in liquidation, sought permission to stay out of winding-up proceedings under section 446(2) of the Companies Act, 1956.
2. The non-applicant had no objection to the applicant's request, subject to certain conditions mentioned in their reply to the application.
3. The Court acknowledged the applicant's right to proceed against the company under section 29 of the State Financial Corporation Act, 1951, and considered granting permission for the applicant to remain out of the winding-up proceedings.
4. However, the Court emphasized that a blanket and unconditional permission could not be granted and decided to impose specific conditions for allowing the applicant to stay out of the winding-up proceedings.
5. The Court granted permission to the applicant, Rajasthan Financial Corporation, to remain out of the winding-up proceedings subject to several conditions.
6. These conditions included valuation of company assets by a registered valuer or technical experts, fixing upset price of assets, wide circulation notice for sale of assets, court confirmation for sale, depositing sale proceeds with the Official Liquidator, filing claims before the Official Liquidator, and seeking court approval for withdrawal of sale proceeds.
7. The Court disposed of the application, providing liberty to the applicant to apply for withdrawal of the deposited sale proceeds as per the specified conditions.