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TMI Blog1978 (8) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... ier prepared this voucher. This amount has been debited in the books of accounts at the Jaipur office of Golcha Properties (P.) Ltd. in the year 1965-66. On an inquiry, it was learnt that this amount had not been received in the Delhi office. Non-petitioner No. 1, Shri P.C. Dhadda, adopted the reply which was filed on behalf of the non-petitioner No. 2, Shri G.L. Jain. Shri Jain raised a number of contentions including that sections 538 and 458 A of the Companies Act, 1956, are ultra vires the provisions of art. 14 of the Constitution of India and, therefore, are likely to be struck down. It was further stated by him that in April, 1965, an aggregate sum of Rs. 20,000 was received in the Delhi office of the company in liquidation through bank from third parties who had remitted the same for and on account on behalf of the head office of the company in liquidation at Jaipur. The Delhi office was in need of certain amount in the month of August, 1965, to settle certain matters. It was further contended that from an inquiry he learnt that on or about 30th April, 1965, Shri S.P. Sharma remitted the said sum of Rs. 20,000 through bank to the Delhi office and the said amount was cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rebuttal. A/W-1, Bastimal Singhvi, has stated that he was appointed as an accountant by the official liquidator in November, 1969. From the accounts of the Golcha Properties Pvt. Ltd. he came to know that a sum of Rs. 15,000 was sent from Jaipur office to Delhi office. This amount was sent on 25th of August, 1965, through a messenger and cash voucher No. 320. The name of the messenger has not been disclosed in the cash voucher or anywhere else. Jaipur office has not received any acknowledgment receipt of the said amount from the Delhi office. The witness further stated that he looked into the accounts of the Delhi office also, but did not find any corresponding entry regarding the receipt of Rs. 15,000 which, according to him, have remained unaccounted for. On being cross-examined, the witness stated that he did look into the accounts pertaining to the item of Rs. 20,000 as pointed out by Shri G.L. Jain. He then searched for a corresponding item of Rs. 20,000 in the Jaipur office ledger, but did not find it. He further stated that he had explained to Shri G.L. Jain that the amount of Rs. 20,000 was adjusted in the Jaipur office in respect of other items and there was no question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 25th August, 1966, vide cash voucher No. 320 but there is no cross entry of the said amount in the Delhi office. On 3rd March, 1970, he addressed letters to Shri P.C. Dhadda and Shri G.L. Jain asking them to explain as to what happened to Rs. 15,000 and also asked the name of the messenger who had taken the money. On being cross-examined the witness stated . that he moved for the release of the account books as under the Indian Companies Act the books and records of the company have to be in the custody of the court. The official liquidator could not have functioned without the account books and the record of the company. In May, 1969, the witness came to know that the loan ledgers of Delhi office were incomplete in certain respects. He had directed the manager of the Golcha cinema to find out the list of creditors. The statement of the manager of the Golcha cinema was also recorded. The witness required ledgers, cash books and other subsidiary record vouchers, etc., to know the correct position of the assets and liabilities of the company. The balance-sheets for the year 1965-66 could be ready only in February, 1970. Whenever there is a defalcation the amount of defalcation is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6, at Delhi and next on March 26, 1968, at Jaipur. D.W. 2, Satya Prakash Sharma, stated that he was posted at the Jaipur office. He was supposed to arrange funds whenever they were needed by the company in liquidation both for Jaipur and Delhi offices.. He filed a claim against the company in liquidation for a sum of Rs. 5,000. He arranged a sum of Rs. 20,000 for the company in liquidation for the same was needed at the Delhi office of the company in liquidation. He got back Rs. 15,000 out of the said amount. He got it back some time in August, 1965, and the balance of Rs. 5,000 remains to be recovered from the company in liquidation. A suspense account had been opened by him and a sum of Rs. 20,000 had been credited to the same account. This witness was taken as a director in S. Zoraster Supplies Co. Ltd., Dharti-dhan, Supreme General and other concerns. All these companies are in Golcha group of companies. He was the general manager of S. Zoraster Supplies Co. from May, 1965, to May, 1966. He used to arrange for money for these companies from others. He arranged in the month of April, 1965, Rs. 20,000 each for Jaipur and Delhi offices. He does not remember the names of the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alance-sheets for the years 1965-66, 1966-67 and 1967-68 of the company in liquidation. He looked into the account books in order to find out if there was any co-relationship between the entry marked 'X' and the entries of Rs. 20,000 already marked. He did not look into the corresponding entry of Rs. 20,000 in the suspense account. The entry of Rs. 20,000 has been posted from the entry, Ex. D-13, which finds place in the journal at page 249 of the Delhi office for the year 1965-66. He could not know the co-relationship between the entry of Rs. 15,000 and the entry of Rs. 20,000. He further stated that the entries, B-2, B-3, and B-4, have no bearing to the entry 'X' because the details of these entries are different. Issue No. 1 : "Officer" has been defined in sub-section (30) of section 2 of the Companies Act. "Officer" includes any director, managing agent, secretaries and treasurers, manager or secretary "or any person in accordance with whose directions or instructions the board of directors or any one or more of the directors is or are accustomed to act" and also includes, ( a ) where the managing agent, the secretaries and treasurers or the secretary is or are a firm, an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 25th August, 1965, vide voucher No. 320 stating "cash sent with messenger" was neither traceable in the Delhi office books nor in the Bombay office books for the year 1965-66. In view of these circumstances, the claim filed by the official liquidator after excluding the time as provided under s. 458A of the Companies Act is within time. Issue No. 3: DW-2, Shri Satya Prakash Sharma, has stated that he was the general manager of M/s. S. Zoraster Co. (P.) Ltd. He was posted at Jaipur and he was supposed to arrange funds whatever needed for the affairs of the company in liquidation. He has filed a claim against the company in liquidation for a sum of Rs. 5,000. He stated that he had arranged a sum of Rs. 20,000 for the company in liquidation as the same was needed in the Delhi office of the company. He got back Rs. 15,000 out of that amount. For the balance a claim has been filed. A suspense account was opened in which these Rs. 20,000 have been credited. At the time when this transaction took place he was not a director in M/s. S. Zoraster Co. (P.) Ltd. He worked as general manager from May, 1955, to May, 1966. He has further stated that it is difficult to recall after the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inconveniences to the staff which must have been caused by sending the amount from Jaipur to Delhi. Even if for argument's sake the plea which the non-petitioner has taken were to be taken into consideration then the person who received Rs. 15,000 at Delhi has not been produced as a witness. In view of all these circumstances, there is only one irresistible conclusion and that is that the amount of Rs. 15,000 sent from the Jaipur office to the Delhi office was not credited and remained unaccounted for. Shri S.P. Sharma has tried to take the responsibility on himself, but that does not in any way absolve the non-petitioners of their responsibility in the discharge of their duties. Issue is accordingly decided. Additional issue No. 1 The evidence of the parties has been discussed and a finding is on record that the amount of Rs. 15,000 does not find any cross-entry in the Delhi office. The non-applicants Nos. 1, 2 and 3 cannot be absolved of their responsibility. After having drawn the amount they did not take care to see that the amount is got credited at the Delhi office or is accounted for. It is difficult to hold that the [amount was misappropriated, but there is ample evi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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