9911796707
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Issues:
Compulsory winding up of a joint stock company due to lack of progress in setting up a sugar mill, Alleged misfeasance and breach of trust by managing agents, Claim of lien by managing agents over company funds, Jurisdiction of the Court to pass interim orders for production of money, Applicability of section 185 of the Indian Companies Act, Power of the Court to preserve property pendente lite, Requirement of security for disputed amount, Order for depositing disputed sum in the bank, Directions for further proceedings before the District Judge. Analysis: The judgment pertains to the case involving the compulsory winding up of a joint stock company, initiated due to the lack of progress in establishing a sugar mill. The managing agents of the company were accused of misfeasance and breach of trust regarding company funds. The managing agents claimed a lien over a sum of money in their possession, arguing it was for remuneration and expenses incurred on behalf of the company. The Court was approached to resolve the dispute regarding the claimed lien. The Court examined the jurisdictional aspect of passing interim orders for the production of money under section 185 of the Indian Companies Act. The Court found that the managing agents, being officers of the company, were subject to the summary powers of the Court to preserve company property pending resolution of the dispute. The Court emphasized the need to protect the funds from potential misappropriation, given the circumstances and admissions made by the managing agents. The judgment highlighted the discretionary powers of the Court to safeguard disputed amounts and prevent waste or misappropriation by fiduciaries of the company. The Court rejected the argument that section 185 did not apply in cases involving claimed liens, emphasizing the need for interim protection of company assets. Additionally, the Court cited provisions of the Code of Civil Procedure to support its authority to issue interim orders for the preservation of disputed property. Regarding the requirement of security for the disputed amount, the Court declined the request for the managing agents to furnish security, considering their past conduct and the need for immediate protection of the funds. The Court ordered the managing agents to deposit the disputed sum in a specified bank account within a month for safekeeping until the resolution of the dispute on the claimed lien. In conclusion, the Court allowed the appeal to the extent of modifying the order for payment, directing the managing agents to deposit the disputed amount in a designated bank account. The Court also outlined further proceedings before the District Judge, including the framing of issues and recording of evidence from both parties in the subsequent hearings. This detailed analysis of the judgment addresses the issues related to the compulsory winding up of the company, the claim of lien by managing agents, the jurisdiction of the Court to pass interim orders, and the requirement for safeguarding disputed funds pending resolution of the dispute. The judgment underscores the Court's authority to protect company assets and ensure fair proceedings in matters involving fiduciaries and company finances.
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