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TMI Blog1974 (3) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... ay Rs. 28,400 in prescribed instalments in terms of the hire-purchase agreement, exhibit P-1, in respect of vehicle No. PNJ-7945; that a sum of Rs. 16,623.18 plus interest with effect from February 1,1965, was outstanding against the two respondents as well as their guarantor, the third respondent; that the respondents were disputing their liability to pay the amount; that the hire-purchase agreement contained a stipulation in writing to refer all questions and matters of difference between the parties in regard to their rights, duties and obligations and their enforcement by the parties (including the failure to pay the amount claimed under the various clauses of the agreement) to the sole arbitration of Shri C. L. Vohra, Advocate, Civil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourse, but framed the two issues about there being sufficient cause for not referring the matter to arbitration and about the document exhibit P-2 (an acknowledgment of the debt, dated January 31, 1965), being a forged document and about the effect thereof. The learned judge recorded evidence on the two issues including that of an expert and held that the written acknowledgment, exhibit P-2, was a forged document and respondents Nos. 1 and 2 had paid out the entire amount due under the hire-purchase agreement. On that short ground he dismissed the application of the appellant-company. This appeal has been contested by respondent No. 2. Mr. Krishan Lal Kapur, the learned counsel appearing for him, has not seriously contested the propositio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s which a living company may possess cannot be co-extensive with the powers to be exercised by the liquidator, and since the directors of the company are supposed to know their own business but an official liquidator is very often a new man unconnected with the business carried on by the company, his knowledge and information of things was not likely to be co-extensive with the knowledge of the directors, and, therefore, the learned judge did not consider it proper to permit the official liquidator to refer the dispute in question to private arbitration. In the course of the judgment, it was observed that the Companies Act does not make any mention of a power to refer to "arbitration" even with the sanction of the court. The matter with whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion having also been dismissed before that day, the merits of the claim in that application which alone have to be adjudicated upon in this appeal have not, in my opinion, been affected at all by the company being ordered to be wound up in the meantime. Section 457 of the Companies Act authorises the liquidator in a winding-up by the court to institute or defend any suit, prosecution or other legal proceeding in the name and on behalf of the company with the sanction of the court. An application under section 20 of the Act or an appeal against a decision given therein is, in my opinion, a legal proceeding covered by section 457(1)( a ) of the Companies Act. Under sub-section (2) of section 457 the liquidator in a winding-up by the court ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by sub-section (4) of section 446. The resultant position is that this appeal cannot be held to have either abated or become infructuous under any provision of law, and has to be dealt with and disposed of on merits. As already stated, there is practically no defence in support of the order of the trial court on its merits. Mr. C.D. Dewan, who had originally been engaged by the company, was subsequently retained and engaged by the official liquidator, and an objection to his right to continue the appeal was raised before me by the learned counsel for the contesting respondent on February 12, 1974. I directed him to secure authority of the official liquidator by obtaining and filing his vakalatnama. Mr. Dewan has since filed that vakal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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