9911796707
TMI Blog1995 (1) TMI 292X X X X Extracts X X X X X X X X Extracts X X X X ..... in relation to the property of the company and for a consequential direction to the respondents to contribute jointly and severally a sum of Rs. 4.61 lakhs with interest at 6 per cent. per annum and for costs, etc. The averments as mentioned in the application are that the company was incorporated in the year 1972 with an authorised capital of Rs. 1 lakh and thereafter it was increased to Rs. 5 lakhs divided into 5,000 equity shares of Rs. 1,000 each. By order dated January 28, 1987, this court in C.P. No. 5 of 1981, ordered winding up of the company and, consequently, the official liquidator was appointed. It is submitted by the petitioner that the respondents have misapplied, retained, have become liable or accountable for, the monies a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the cases the debtors were not traced. The assets of the company were allowed to be taken away by the creditors indiscriminately. The account books of the Vijayawada branch were not delivered to the official liquidator. Thus, the respondents committed various acts of misfeasance. Counter-affidavits have been filed by the respondents alleging that the petition is not maintainable and the same is misconceived. It is also barred by limitation. It is specifically averred by the respondents that no specific act of misfeasance or negligence on the part of the director or managing director have been made in the petition. The allegations made against the directors and the managing director en masse cannot be enquired into by this court unless ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as regards the misappropriation and diversion of funds for personal gains and various acts of commission and omission and negligence by the directors and the managing director. The witnesses examined on behalf of the respondents have categorically stated that no specific allegation has been made against the individual respondents and that whatever records were available with the company have been handed over. Therefore, they stated that the application is not maintainable and the same has to be rejected. Respondent No. 3 was set ex parte while respondents Nos. 4 and 6 expired. No steps were taken to bring the legal representatives on record. Hence the case against respondents Nos. 4 and 6 abates. On the basis of the evidence adduced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... restore the money or property or any part thereof respectively, with interest at such rate as the court thinks just or to contribute such sum to the assets of the company by way of compensation in respect of the misapplication, retainer, misfeasance or breach of trust, as the court thinks just. (2) An application under sub-section (1) shall be made within five years from the date of the order for winding up, or of the first appointment of the liquidator in winding-up, or of the misapplication, retainer, misfeasance or breach of trust, as the case may be, whichever is longer. (3) This section shall apply notwithstanding that the matter is one for which the person concerned may be criminally liable." A reading of the said provision stip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Liquidator, Navarashtra Publishing Co. Ltd. v. Ashok Kumar [1976] 46 Comp Cas 572 (Patna). Learned counsel for the respondents also relied on the judgments in Official Liquidator, Karnataka High Court v. R.C. Marathe [1980] 50 Comp Cas 562 (Kar) and Official Liquidator, Madras Oils and Fertilizers ( P. ) Ltd. v. G. Shanmugham [1979] 49 Comp Cas 903 (Mad). He submits that no specific overt act has been made against the respondents individually. The petitioner proceeded as if the respondents are jointly and severally liable for the acts of misfeasance or misapplication of the funds of the company. I have gone through the averments made in the petition vis-a-vis, the evidence adduced in support of the petition. It is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ully pressed into service under section 543 of the Act. After scanning through the evidence adduced on behalf of the parties, I find that the petitioner has not been able to establish that the respondents either misapplied or retained money or property of the company or committed an act of misfeasance or breach of trust in relation to the company. The allegations in the petition and the evidence adduced by the petitioner are most general in nature. No specific or particular allegation has been made in regard to each and every respondent so as to make him responsible for repaying or restoring the money or property of the company. Though the directors and the managing director fall within the category of the officers as defined under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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