9911796707
TMI Blog1995 (11) TMI 374X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court of Judicature at Bombay. (2) To grant leave under section 453 for appointment and continuation of the receiver of the High Court of Bombay regarding the mortgaged and hypothecated properties of the respondent-company. (3) To grant leave under section 537 for recovery of the applicant s dues by sale of the movable and immovable properties of the respondent-company charged in favour of such dues and enforcement and other execution and distress proceedings as the Bombay High Court may direct in the above-noted suit. 2. The relevant facts in brief as set out in this application are that the applicant-bank granted term loans to the respondent-company for modernisation of its textile mills at Hastinapur in the State of U.P., which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt had directed that the winding up order dated 27-3-1991, be put in abeyance until further orders, as an appeal had been preferred by the respondent-company before the appellate authority for Industrial and Financial Reconstruction ( the AAIFR ). As the appeal preferred before the AAIFR was dismissed on 13-5-1993, this court vide its order dated 12-4-1994, directed the official liquidator appointed, vide the order dated 27-3-1991, to proceed with the winding up of the respondent-company. The present application has been filed thereafter by the applicant-bank for the reliefs mentioned above. 3. Copy of this application was served on the official liquidator who has filed a counter-affidavit to the same. A rejoinder-affidavit to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver had already taken possession on 3-2-1994. The suit before the Bombay High Court is pending for the last five years. There is, therefore, no reason to refuse the grant of permission to continue the proceedings of this suit. That apart, the Supreme Court in M.K. Ranganathan v. Government of Madras [1955] 25 Comp. Cas. 344 has held that if a secured creditor files a suit for the realisation of his security, he is bound to obtain leave of the winding up court as provided in the Act, although such leave would almost automatically be granted . The official liquidator has, however, contended that he has no objection for continuing the suit filed by the applicant. However, the same should be transferred to the winding up court under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e applicant can be granted subject to the condition that the applicant-bank deposits with the official liquidator a sum of Rs. 15,000 only towards the cost and expenses to be incurred by the official liquidator in engaging a counsel and for contesting the suit at Bombay, and, further if the said suit is decreed by the court the decree shall not be executed without obtaining further orders from this court. Shri Agarwal had, however, contended that it will not be reasonable to impose such condition on the applicant-bank. I am, however, unable to agree. It is well-settled that the court is not bereft of power to incorporate any terms while granting such leave and it is explicitly made clear by the phraseology subject to such terms as the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said applicant, it would be in the interest of justice to let the receiver continue and to dispose of the properties of the company for the recovery of the dues by the sale of the said properties charged in favour of the applicant. The official liquidator has on the other hand contended that under section 456, where a winding up order has been made and the liquidator has been appointed on the property, effects and actionable claims to which the company appears to be entitled shall be taken into the custody and control of the official liquidator. Under section 456(2) all the property and effects of the company shall be deemed to be in the order for winding up of the company, therefore, there is a bar in the appointment of the receiver. So fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it the receiver to continue over the assets of the company only for safeguarding the interest of the applicant-bank. Having considered the submissions made by the official liquidator and the learned counsel for the applicant, I am of the view that it would not be appropriate for this court to pass any orders on the second and the third prayer made by the applicant-bank. I am further of the view that as the receiver has been appointed by the Bombay High Court, in the suit instituted by the applicant-bank against the respondent-company prior to the winding up order, it would be proper for the official liquidator to approach the Bombay High Court for appropriate orders for the removal of the receiver appointed by the said court in the light of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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