1978 (11) TMI 125 - HC - Companies Law

Summary

Issues:
1. Maintainability of the application for setting aside the ex parte winding-up order.

Analysis:
The judgment involves the issue of the maintainability of an application seeking to set aside an ex parte winding-up order passed against a company. The company, represented by a former director, filed two applications - one under section 466 of the Companies Act and the other under section 151 of the Code of Civil Procedure. The petitioning creditor and official liquidator objected to the application, arguing that the winding-up order, though ex parte, was based on proper consideration and had irreversible consequences affecting various parties, including creditors and former officers. They contended that only the official liquidator could represent the company post-winding up. However, the applicant's counsel relied on previous judgments where ex parte winding-up orders were set aside and argued that former directors retained residual rights to represent the company's grievances.

The judge, after considering the arguments, found in favor of the applicant. Referring to previous judgments by Kapur J., the judge agreed that the court had the power to set aside an ex parte order, even post-winding up. The judge rejected the contention that only the official liquidator could represent the company after winding up, citing examples where former directors could still exercise certain powers, such as appealing against a winding-up order. Additionally, reference was made to a case where an ex parte winding-up order was set aside, indicating that such actions were not uncommon. The judge concluded that the application to set aside the winding-up order was maintainable and scheduled both applications for a hearing on the merits.

In summary, the judgment addressed the maintainability of an application to set aside an ex parte winding-up order, emphasizing the residual rights of former directors to represent the company's interests post-winding up. The judge relied on previous judgments to support the decision that the application was maintainable, despite objections raised by the petitioning creditor and official liquidator.