1972 (11) TMI 40 - HC - Companies Law

Summary

Issues Involved:

1. Whether the application under section 235 of the Indian Companies Act is barred by time?
2. Whether the application falls under the provisions of section 235 or section 244B of the Indian Companies Act, 1913, and whether it is competent?
3. Whether the official liquidator has locus standi to present the application?
4. Whether the respondent as liquidator was required under section 224B of the Indian Companies Act, 1913, to file a statement of unclaimed dividends and deposit the same within six months?
5. If so, whether the respondent deposited Rs. 19,054 in the companies liquidation account?
6. If the respondent did not deposit the amount, whether he is liable for misapplication, retainer, misfeasance, or breach of trust under section 235 of the Indian Companies Act, 1913?

Issue-wise Detailed Analysis:

1. Whether the application under section 235 of the Indian Companies Act is barred by time?

The court examined the limitation period prescribed under section 235 of the Indian Companies Act, 1913. The relevant part of section 235 states that an application must be made within three years from the date of the first appointment of a liquidator or from the date of the misapplication, retainer, misfeasance, or breach of trust, whichever is longer. The court noted that the first regular liquidator was appointed on October 11, 1950, and the present application was filed on October 28, 1970. The court rejected the argument that the limitation period should run from the appointment of any subsequent liquidator, holding that the limitation period runs from the first appointment of the liquidator. Consequently, the application was deemed barred by time as it was filed far beyond the prescribed period of three years from the first appointment of the liquidator.

2. Whether the application falls under the provisions of section 235 or section 244B of the Indian Companies Act, 1913, and whether it is competent?

The court deemed it unnecessary to address this issue in detail due to the findings on issues 1 and 3. However, it was noted that the respondent's argument that the amount of Rs. 19,054 could not be considered an unclaimed dividend under section 244B was acknowledged but not elaborated upon.

3. Whether the official liquidator has locus standi to present the application?

The court found that the respondent had rendered an account of the monies in his hands and placed the amount at the disposal of the court for distribution to other creditors. This was done under the sanction of the court, and the order had not been challenged. Therefore, the payments made had legal sanction, and the official liquidator, being the successor of the respondent, could not challenge this. The court held that the official liquidator had no locus standi to present the application.

4. Whether the respondent as liquidator was required under section 224B of the Indian Companies Act, 1913, to file a statement of unclaimed dividends and deposit the same within six months?

This issue was not directly addressed in the judgment due to the findings on issues 1 and 3. However, it was implied that the respondent's actions were sanctioned by the court, and thus, the requirement to file a statement of unclaimed dividends and deposit the same was not considered in detail.

5. If so, whether the respondent deposited Rs. 19,054 in the companies liquidation account?

This issue was also not directly addressed due to the findings on issues 1 and 3. The court noted that the amount was tendered over in court and disbursed among creditors under the court's authority.

6. If the respondent did not deposit the amount, whether he is liable for misapplication, retainer, misfeasance, or breach of trust under section 235 of the Indian Companies Act, 1913?

Given the findings on issues 1 and 3, this issue was not elaborated upon. The court noted that the entire amount was disbursed among creditors under court orders, and there was no misappropriation or misuse by the respondent.

Conclusion:

The application was dismissed on the grounds that it was barred by time and the official liquidator had no locus standi to present the application. The court noted that the issue was technical, relating to whether the amount should have been deposited in the companies liquidation account or tendered over into the court for distribution. There was no order as to costs.