9911796707
|
Home
Issues: Appointment of Provisional Liquidator
Analysis: 1. The application under Section 175 of the Act sought the appointment of a Provisional Liquidator for a company, Andhra Paper Mills Ltd., which was facing financial difficulties. The company's authorized capital, issued capital, and outstanding debts were detailed in the judgment. The petitioner, a creditor of the company, had served a statutory notice demanding payment, which the company failed to meet, indicating a potential compulsory winding up order. 2. The main issue was whether a case was established for the appointment of a provisional liquidator. The company was found to be commercially insolvent, with a significant deficit in its balance sheets for consecutive years. The company had unpaid dividends and interest on debentures, leading to substantial outstanding debts. The company's mills were closed, and the trustees of the first debenture-holders had taken control due to non-payment of interest. 3. The trustees for the first debenture-holders and the managing agents had no objection to the appointment of a provisional liquidator. The petitioner sought the appointment to secure the company's assets, citing ongoing troubles with employees and safety concerns for the assets due to the management's absence from the company's location. 4. The judgment referenced legal precedents regarding the appointment of provisional liquidators and highlighted that the company and the trustees supported the petitioner's application. The only opposition came from a shareholder, whose objections were deemed irrelevant for the present application. The court appointed a chartered accountant as the provisional liquidator to oversee the company's assets, in cooperation with the trustees, and set conditions for the provisional liquidator's appointment and powers under Section 179 of the Act. The costs of the application were ordered to be included in the main petition's costs.
|
