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TMI Blog1979 (4) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... District Board of Sahabad and Martin Company Ltd., for and on behalf of Arrah Sasaram Light Railway Company Ltd., the latter company was to be formed for the construction and erection of tramways or light railways between Arrah and Sasaram. On the 19th of October, 1909, Arrah Sasaram Light Railway Company Ltd. was incorporated as a public limited company having its registered office at No. 12, Mission Row, Calcutta. On the 17th of July, 1910, an agreement was entered into between the then District Board of Sahabad and Martain Company Ltd., Calcutta, being the promoters of the Arrah Sasaram Light Railway Company Ltd. for the construction of tramways or light railways to be worked by steam power from Arrah to Sasaram through the road between Arrah and Sasaram under the jurisdiction of the said District Board on the terms and conditions of the agreement dated the 15th of October, 1909. On the 6th of March, 1911, the company, Arrah Sasaram Light Railway Company Ltd. was opened in terms of the said principal agreement dated the 15th of October, 1909. On the 19th of August, 1936, a supplementary agreement was entered into between the said District Board of Sahabad and the Arrah Sasar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Calcutta passed a resolution that the company be wound up voluntarily by members' voluntary winding-up and further resolved that M/s. S. Gupta and Ramen Mukherjee be appointed liquidators of the said company for the purpose of winding up the affairs and distributing the assets of the company with joint and several powers. The said liquidators were authorised to act jointly and severally and exercised all or any of the powers enumerated in clause ( a ) to ( d ) of sub-section (1) of section 457 of the Companies Act, 1956. It appears that in the course of the said voluntary liquidation all the formalities were complied with and the said joint liquidators took a decision to sell the assets of the said company and invited tenders for that purpose. Respondent No. 2, Technical Steel Alloy Company Ltd,, made the highest offer for the purchase of a part of the assets of the said company, namely, railway track, sleepers, rolling stock, plants and machinery lying in its premises between Arrah and Sasaram for a total sum of Rs. 95 lakhs and the same were sold by the company through the said joint liquidators to the said purchaser being respondent No. 2, Technical Steel Alloy Company Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oldened by the order of the Sub-Divisional Officer, Sasaram, dated 30th October, 1978, and were hurriedly removing the materials lying between Sasaram and Hassanbazar Stations and were damaging the railway tracks and buildings and that the acts of the accused were unjustified, unlawful and illegal. The Sub-Divisional Officer, Sasaram, on the 20th of November, 1978, restrained the company and others, being the purchaser and its agents, from going near the disputed lands and assets to prevent the alleged breach of peace, and directions were given for filing a show-cause statement by the railway and other opposite parties. Thereafter, respondent No. 1, District Board, Rohtas, filed the Title Suit No. 164 of 1978 before the Sub-Judge's Court, Sasaram, against the company, its deputy general manager, the purchaser, Technical Steel Alloy Company Ltd., and the manager of the purchaser and also made the District Board, Bhojpur, a pro forma defendant for the adjudication of the respondent No. 1, District Board, Rohtas' claim and for a decree for accounts in respect of the profit loss and also for a decree of Rs. 1,00,000 and other reliefs. A copy of the plaint is annexed to the said a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 518(1)( b ) of the Companies Act, 1956, in the facts of this case also. Mr. R.C. Deb, appearing for respondent No. 1, District Board, Rohtas, submitted that in view of the said unreported decision of mine (see p. 337 infra) covering the said question, he did not wish to advance any argument on this question but he is not admitting that the said decision is correct. Thereafter, Mr. Mukherjee referred me to the conduct of respondent No. 1, District Board, Rohtas, firstly starting with the criminal proceeding under section 144 of the Cr. PC one after the other and, thereafter, filing the suit obtained in ex parte injunction as hereinbefore stated. He submitted that the whole intention of respondent No. 1, District Board, Rohtas, is to prevent the joint liquidators from discharging their duties as liquidators by collecting the assets and distributing the same according to the Companies Act, 1956. Mr. Mukherjee submitted that at best the claim of the District Board, Rohtas, if any, is a money claim which can always be preferred before the liquidators and there is no allegation that the same could not be paid. The company would have enough funds to pay out of the sale procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... am not going to cut down the meaning of the 138th section. In a voluntary winding-up a liquidator may apply to the court to decide any question fairly arising in the winding-up, and it is much cheaper to bring it before me by way of motion than by an action." Relying on the said observation Mr. Sen submitted that it will be proper for this court being the winding-up court, having jurisdiction over the company (in voluntary liquidation), to decide the said question which has been raised in the suit filed by the District Board, Rohtas, in the Sub-Judge's Court, Sasaram. Mr. Sen also referred to a passage in Buckley on the Companies Acts, 13th Edn., p. 607, where dealing with section 307 of the English Companies Act, 1948, which is in pari materia with section 518 of the Companies Act, 1956, the author has commented as follows : The object of the Act is to leave the company, its contributories, and creditors, if possible, to settle their affairs without coming to the court for either a compulsory or a supervision order, but to provide them under this section with the means of access to the court in the voluntary winding-up just as in a compulsory winding-up or under supervisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be transferred to this court for expeditious trial. Mr. Sen also submitted that the suit filed by the respondent is for a realisation of money and it may involve the (interpretation as to the) construction of certain documents and, therefore, it will be convenient f6r the matter being heard by this court and the suit should be transferred. Mr. R.C. Deb appearing with Mr. J.P. Srivastava for the District Board, Rohtas, the respondents, firstly submitted that this court has no jurisdiction to transfer the said suit from Sasaram to this court but Mr. Deb, in his usual fairness, submitted that in view of my judgment in the Agra Electric Supply Company's case (see p. 337 infra) covering an identical point he is not making any submission, but, he is not conceding. Mr. Deb thereafter submitted that the court should not exercise its power assuming that there is such a power under section 518 read with section 446 to transfer the said suit as the balance of convenience is not in favour of the suit being tried in this court. Mr. Deb referred to a decision of Bachawat J., in In re P. P. De Co. Ltd. [1951] 55 CWN 271 at pp. 273 274 ; 21 Comp. Cas 215 that the court should not ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ., by sale of its assets and distribution of the amounts collected after payment of the debts and finally dissolving the company. The court always retains its jurisdiction over the winding-up and can make any order at any stage of the winding-up whenever necessary in aid of the winding-up as asked for by the liquidator. In this case, there cannot be any question that the balance of convenience is overwhelmingly in favour of the suit being tried in this court, the court having jurisdiction over the company which is voluntarily wound up. The material evidence, both documentary and oral, most of them, are lying at Calcutta. Further, the claim of the said respondent, District Board, Rohtas, is a money claim and it may involve the interpretation of certain documents and the same can be conveniently tried by the winding-up court extensively and at less expense, within a minimum time. The conduct of respondent No. 1, by instituting proceedings under section 144 of the Cr. PC one after another and finally filing the suit at Sasaram and obtaining an ex parte injunction, restraining the liquidator and the purchaser from going near the railway track and removing the assets, makes it quite ..... X X X X Extracts X X X X X X X X Extracts X X X X
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