1976 (3) TMI 142 - HC - Companies Law

Summary

Issues Involved:
1. Payment to creditors who have died or cannot be traced.
2. Determination of claims by new creditors.
3. Handling of funds received by the official liquidator after the scheme's sanction.
4. Entitlement of the official liquidator to commission on various amounts.

Issue-wise Detailed Analysis:

1. Payment to Creditors Who Have Died or Cannot Be Traced:
The court addressed the issue of payments to creditors who either have died or cannot be traced. It was noted that small amounts totaling Rs. 2,800.82 were due to nine creditors. The court, under section 392 of the Companies Act, 1956, decided that it was not necessary for these small creditors to produce succession certificates before payment. The propounders of the scheme must ensure payments are made to the right persons, either by obtaining indemnity bonds or by requiring succession certificates if there is any doubt about the claimants' identities. For untraceable creditors, the applicant-company should retain the money and pay it when the creditors are found. The company is required to keep the court informed by submitting a report under rule 86 of the Companies (Court) Rules, 1959, within two months.

2. Determination of Claims by New Creditors:
The court addressed the issue of Rs. 4,385.75 lying undistributed and claims by two new creditors for Rs. 1,000 and Rs. 2,000. It was decided that since the company is no longer being wound up, the official liquidator should not determine these claims. Instead, the company should determine the claims and, if disputed, direct the claimants to seek a court direction under section 392 of the Companies Act, 1956.

3. Handling of Funds Received by the Official Liquidator After the Scheme's Sanction:
The court addressed the handling of Rs. 4,648.75 received by the official liquidator from the company's debtors after the scheme's sanction. The court directed that this amount should be paid to the company and not retained by the official liquidator. Future monies received by the official liquidator should also be handed over to the company.

4. Entitlement of the Official Liquidator to Commission on Various Amounts:
The main issue was whether the official liquidator is entitled to a commission on all monies received and disbursed, including the Rs. 62,000 contributed by the scheme's propounders. The court analyzed rule 291 of the Companies (Court) Rules, 1959, which specifies fees payable to the Central Government for the official liquidator's services. The court concluded that the Rs. 62,000 contributed by the propounders is not part of the company's total assets realized by the official liquidator and thus, no commission is payable on this amount or its disbursal.

For other amounts realized by the official liquidator, the court held that fees are payable to the Central Government as per rule 291. However, disbursements under the scheme are not considered disbursals by the official liquidator and do not attract fees. The court emphasized that payments made to the company after the scheme's sanction are not disbursals within the rule's meaning and thus, no fees are payable on these payments.

The court further noted that if the official liquidator continues to make realizations under previous court orders, fees will be payable on these realizations. If monies are received directly by the company, no fees will be paid to the Central Government. The court has the power to reduce fees if found excessive, but in this case, no reduction was deemed necessary. The court acknowledged the official liquidator's role in the company's revival through realizations from debtors, which should be considered when deciding on fee reduction.

The application was disposed of following these directions, with no costs awarded.