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TMI Blog1974 (8) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... o the Registrar of Companies, it was found that Rs. 892.73 were lying in the hands of the official liquidators. According to the Registrar, this amount being in excess of Rs. 500, the liquidators had contravened the provisions of section 244A of the old Act. He, therefore, demanded penal interest at the rate of 20% March 31, 1963, to January 17, 1964, from the liquidators. The registrar of Companies also alleged that a breach of the provisions under section 24 4B of the old Act was committed by the liquidators inasmuch as unclaimed amount of dividend amounting to Rs. 952.84 was not deposited by them in the Reserve Bank of India. According to the Registrar, the aforesaid sum of Rs. 952 84 should have been deposited by the liquidators immediately after the expiry of six months from February 20, 1961, that is, after August 20, 1961, according to section 244B of the old Act and, therefore, under sub-section (7) of section 244B of the old Act, the liquidators had become liable to pay penal interest on the aforesaid sum from August 21, 1961, to January 17, 1964, at the rate of 20% per annum. The applicants, therefore, preferred an application under section 281 of the old Act for relievin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the old Act was repealed and, therefore, section 281 of the old Act does not survive and the application given by the applicants under section 281 of the old Act was misconceived and not tenable in law. In the alternative, it was urged that assuming that section 281 of the old Act applied, no relief under that section should be granted to the liquidators because the official liquidator cannot be said to be an officer of the company and, therefore, no relief should be granted. The learned judge accepted the contentions of the applicants so far as retention of the amount in their hands and condoned breach of the provisions of section 244A of the old Act. The learned judge, however, with regard to the breach committed under section 244B of the old Act, came to the conclusion that the official liquidator was not an officer of the company and, therefore, section 281 of the old Act under which they claimed relief would not apply. The learned judge, therefore, dismissed the application so far as relief for default under section 244B(7) of the old Act was concerned. Against that order rejecting the relief for default under section 244B(7) of the old Act, the liquidators have preferred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liquidator is appointed to carry on the liquidation proceedings, all the powers of the managing agent or directors of the company would come to an end and it is the liquidator who would look after the affairs of the company for the purpose of winding it up. It is, therefore, difficult to agree with the submission made by Mr Shah, learned Assistant Government Pleader, that the liquidator is not an officer of the company and that he is an officer of the court. No doubt, the liquidator appointed by the court would be an officer of the court. He has to carry on liquidation proceedings under the supervision of the court. All the same, the fact remains that the liquidator while dealing with the liquidation proceedings represents the company which does not lose its identity as a company till it is dissolved. The liquidator alone can act for and on behalf of the company. In my opinion, therefore, the liquidator can be said to be an officer of the company though not specificially mentioned in section 2(11) of the old Act or section 2(30) of the new Act of 1956. In the Calcutta case referred to by the learned advocate for the applicants, Alexander Thomson Montgomery, ILR [1955] 2 Cal. 439, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spect, I am in entire agreement with the observations made by the Kerala High Court. Similarly, in the case of Official Liquidator, Mysore Spun Silk Mills Ltd. v. Commissioner of Income-tax [1971] 41 Comp. Cas. 226 (Mys.) it was observed : "Even after a winding up order is passed, the company continues to be a 'person' within the meaning of section 4 of the Income-tax Act, and, therefore, any receipt of income in the course of the winding up which would attract liability to income-tax under its appropriate provisions would be liable to income-tax. The liquidator, on an order for winding up being made, becomes the 'principal officer' of the company within the meaning of section 2(35)( a ) of the Income-tax Act, 1961. A company judge has power to require the liquidator to file returns before the Income-tax Officer. The legal position of the liquidator, whether he is a liquidator appointed in a voluntary winding up or under the compulsory winding up by orders of the court, is the same. The liquidator is an officer of the court employed for the purpose of winding up of the affairs of the company in liquidation. The company on the making of an order of compulsory winding up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Ramchandiram Mirchandani, AIR 1968 Bom. 208 ; [1968] 38 Comp. Cas. 39 , wherein it was observed: "The definition of 'officer' in section 2(30) is merely an inclusive definition and creates a fiction for deeming a partner an officer. But there is no justification to carry that fiction still further, and hold, although it is not so specifically provided that every partner of a firm of managing agents is himself a managing agent of the company within the meaning of section 2(25). Further, the word 'firm' is not used in section 2(25) unnecessarily or redundantly. The presence of the word 'firm' indicates that when a partnership firm is a managing agent, every partner of that firm separately is not intended to be treated as a managing agent of the company. If the legislature intends that for the purposes of disqualification in section 261(1) every partner of a firm of managing agents should himself be treated as a managing agent, the Legislature should make suitable amendments to effectuate that intention". I fail to understand how this ruling will support Mr. Shah in his submission that the liquidator would not be an officer of the company. On the contrary, as observed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pothan, ILR [1966] 1 Ker. 1, therefore, it was observed as under while interpreting section 633 of the Act : "Now, so far as payment of interest is concerned, what that clause does is to declare the liability of the liquidator to pay interest; it makes no special provision for the enforcement of the liability. It is not as if there is an automatic order for recovery against the liquidator by reason of the clause, and hence, it is to be assumed that the liability is to be enforced and recovery effected in the normal course by a proceeding either in the court or in the ordinary courts. That being so, I should think that recovery by any such proceeding would be something falling within the scope of subsection (2) of section 633 and in respect of which this court is competent to grant relief." In my opinion, the court is competent to grant relief under section 281 of the old Act and even under the provisions of section 633 of the new Act. The evidence clearly shows that the liquidators through a bona fide error of law had not deposited the said amount in the Reserve Bank. But they had kept the said amount in the scheduled bank. It is thus clear that the liquidators had not obtai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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