9911796707
TMI Blog1996 (7) TMI 460X X X X Extracts X X X X X X X X Extracts X X X X ..... obtained a decree. The learned advocate submits that the business had collapsed and that an application for winding up of the concerns has been entertained by the High Court and a liquidator has been appointed. He has submitted that having regard to the provisions of section 587 of the Companies Act, 1956, once such a development takes place, it is not competent for any court to either commence or continue with any legal proceedings in relation to recoveries either against the concern or persons who have contributed to it. He, therefore, submits that this revision is entitled to succeed in so far as by virtue of the provisions of section 587 of the Companies Act, it will have to be held that no further steps can be taken in the execution p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribes is that the liquidator be afforded a free hand so that all claims can be consolidated before that authority. The section, however, takes cognizance of the fact that there may be situations in which it is undesirable or inadvisable for the company court to prohibit the proceedings from going on. A typical example would be a situation wherein the person in charge of the affairs of the companies are demonstrated to have indulged in massive frauds or acts of misappropriation or other criminal offences and in any situation such as this, the company court would not only refuse to stop any such proceedings but to my mind would be fully justified in directing that they should either be commenced or proceeded with expeditiously. One need ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... son, he was also gullible and that he was completely taken in by the representations made by the petitioner and other members of his family and that he has invested his entire life savings which have now become difficult to recover. The learned advocate submits that in these circumstances the respondents should be permitted to carry on with the execution proceedings and if he is unsuccessful there, he should be permitted also to take appropriate proceedings by way of prosecution against the petitioner if the same is competent on the facts of this case. Those aspects are within the ambit of the company court and if the respondent satisfies the court that this is a valid case in which the litigation should be permitted to continue or that fur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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