2012 (6) TMI 253 - HC - Companies Law

Application u/s 446 of the Companies Act - prayer to direct respondent (one of the secured creditors), to furnish details of the interest accrued on the sale proceeds of assets, possession of which was taken over by respondent and to direct the respondent to deposit Rs. 5,00,000/- out of the sale proceeds of Rs. 75,00,000/- - Held that - Since balance amount of Rs. 19,42,000/- is available with the respondent under the common head which is available to all the secured creditors as well as for meeting the other eventualities, a sum of Rs. 5 lacs from the said amount to be deposited with Official Liquidator for taking up further proceedings of liquidation of the Company by inviting claims from all concerned. Therefore, at this stage, the direction to furnish details of the interest earned is not necessary to be granted in this application.

Summary

Issues:
1. Application filed by Official Liquidator under section 446 of the Companies Act for directing respondent to furnish details of interest accrued on sale proceeds and to deposit a specific amount.

Analysis:
The Company in liquidation was wound up, and the respondent, a secured creditor, sold assets for Rs. 75,00,000. Various amounts were appropriated by different creditors, leaving a balance of Rs. 19,42,000. The court directed the respondent to deposit Rs. 5,00,000 with the Official Liquidator for further proceedings of the liquidation to invite claims and decide dividends under Section 529A of the Companies Act. The respondent was allowed to retain the remaining balance to meet other liabilities and statutory obligations once the company is wound up.

Conclusion:
The court clarified that after paying Rs. 5,00,000 to the Official Liquidator, the respondent could retain the balance. If claims from workmen arise, the Official Liquidator will request details of profits earned from the appropriated amounts by all creditors to decide dividends. If the remaining balance can cover workmen's claims, the respondent must deposit the required amount. If more funds are needed, all creditors must proportionately deposit the necessary amounts. The respondent was directed to deposit Rs. 5,00,000 within four weeks, and the application was partially allowed.