2006 (2) TMI 300 - HC - Companies Law

Summary

Issues:
1. Liquidation of three companies and distribution of assets.
2. Compromise applications filed by United Bank of India and Sri Ranjit Kishore Mohanty.
3. Appointment of Amicus Curiae and submission of report.
4. Distribution of surplus amount among shareholders.
5. Appointment of Receiver for asset distribution.

Issue 1: Liquidation of three companies and distribution of assets

The judgment addresses Company Act Cases related to three companies: Orient Weaving Pvt. Ltd., National Foundry and Rolling Mills Pvt. Ltd., and Utkal Distributors Pvt. Ltd. After liquidation of two companies, their assets were sold, and the amounts realized were kept in fixed deposits. Utkal Distributors Pvt. Ltd. was found to be a sister concern, leading to its liquidation due to raised claims. The court ordered winding up of Utkal Distributors Pvt. Ltd. and directed the Official Liquidator to appoint a Valuer for the company's assets. Subsequently, parties agreed to amicably settle the matter, leading to the appointment of an Amicus Curiae to assist in determining amounts payable to shareholders and creditors.

Issue 2: Compromise applications filed by United Bank of India and Sri Ranjit Kishore Mohanty

Applications were filed seeking permission to compromise suits against the companies. The terms included payment by the Official Liquidator to the Bank in full satisfaction of dues, leading to the abandonment of claims. Another application sought compromise related to a different suit. However, the court was informed of additional claims by Paradip Port Trust and Government Departments against Utkal Distributors Pvt. Ltd., leading to its tagging with the proceedings. Eventually, the court directed the distribution of surplus amounts among shareholders as per a report submitted by Mr. Das.

Issue 3: Appointment of Amicus Curiae and submission of report

Upon appointment of Mr. Jagannath Das as Amicus Curiae, parties submitted relevant documents for examination. Mr. Das submitted a detailed report specifying dues payable to creditors and proposed payments to shareholders from the surplus amounts available from the liquidated companies. Parties agreed to the distribution suggested in the report, which was accepted by the court.

Issue 4: Distribution of surplus amount among shareholders

After considering the report by Mr. Das and the agreed distribution plan, the court found it just and equitable to distribute the surplus amount among existing shareholders. To facilitate this distribution, the court appointed Mr. Das as a Receiver to oversee the process. The court directed all parties to appear before Mr. Das for the apportionment of shares and distribution of amounts, with the requirement of executing indemnity bonds to refund any amount in case of disputes.

Issue 5: Appointment of Receiver for asset distribution

In light of the appointment of Mr. Das as Receiver, the court directed the liquidator to provide the surplus amount for distribution. Parties were instructed to hand over respective amounts to shareholders/parties as per the apportionment indicated in the report. The court emphasized the completion of the distribution process within a month and instructed banks to return title deeds to concerned parties. Additionally, a sum was allocated to Mr. Das for his services. Finally, the court disposed of all three cases with these directions and observations.