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TMI Blog2009 (5) TMI 544X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be made in relation to specific instances of specific dates when any staff was found to be missing or when it was found that the staff had not been really in their roll of employment. The entire process of clarification of records in relation to each one of the security agencies shall be completed within a period of 30 days and the amounts as found on a proper reckoning shall be disbursed from out of the amounts available to the credit of the respective companies in liquidation and wherever they are not available, the secured creditors in relation to the assets where the security personnel had been deployed shall be liable to make the payments and claim refund when the assets were sold and when amounts are realized in excess of what have been paid by the secured creditors. The requirements as regards the individual companies in liquidation shall be jointly determined by the Official Liquidator in the immediate presence of the secured creditors and all the representatives of stakeholders over the asset owners of the company in liquidation. - C.P. NOS. 7 OF 1996, 71 OF 2000, 5 OF 2003, 119 & 120 OF 2007 AND 9, 11, 21 & 31 OF 2009 (O&M) C.A. NOS. 204 & 370 OF 2007, 231, 78 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the empanelment was being considered on the basis of applications received by various security agencies in response to advertisements made in the newspapers by the office of the Official Liquidator. In view of the differentiation in rates cited by the various security agencies, attempt had been made to make uniform rates and a meeting had been called for on 24-5-2002 at 11.00 A.M. at the office of Registrar of Punjab and Haryana High Court. This had yielded to a subsequent meeting on 29-5-2002 where a grading had been given depending on several factors such as the years of experience, number of staff employees, financial details of the security agencies etc. The minutes recorded on that date evidence the fact that the Committee after deliberations had decided to pay minimum wages as prescribed by the concerned State Government plus 7 per cent as agency charges, a euphemism employed to cover the statutory liability that may require to be borne by the respective security agencies. By this process, the office of the Official Liquidator was trying to absolve itself all its liabilities to make Provident Fund, ESI and other contributions. III. Reasons for accumulation of unattend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s minimum wages towards agency charges also created a corresponding duty to give the details of contributions made on their behalf with the money so collected and in the absence of such proof, the security agencies cannot pursue their claims towards watch and ward expenses; ( iii ) the several demands requiring proof of contributions to ESI and Provident Fund had not been responded at all by the various security agencies and their belated explanations that they were not liable to make contributions on behalf of the staff employed by them betrays absolute falsity of the stand of the security agencies. This contention is made with reference to a specific notice issued to 7 of the security agencies by the office of the Official Liquidator on 22-9-2003 (R-5) demanding information for the details of the contributions made to the Provident Fund Commissioner with effect from 1-7-2002 to 31-7-2003. The reason for making such demand was sought to be explained through Annexure R-6 where it was pointed out that the verification of the requisite number of security guards were deployed at the factory premises could be made only on furnishing proof of the Provident Fund statements along with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficial Liquidator along with the C.A. No. 204 of 2007. The Official Liquidator has placed on record the audit statement of M/s. Chariot Security Services Pvt. Ltd. which states that as on 31-3-2005, the amount shown as due from the Official Liquidator is Rs. 13,81,458. This is pointed out by the counsel as contradicting a larger claim, which is made by M/s. Chariot Security Services (P.) Ltd. in C.A. Nos. 784-785 of 2008. ( iii ) As regards the claims of M/s. Varsed Detective Security (P.) Ltd., the attempt on behalf of the Official Liquidator was to show that the company had been engaged not only in extending security agencies but also that they were extending services as management consultants as found in the audited statements and consequently, the balance sheet referring to the outstanding dues could not relate only to receivables under the head of security services. V. Reply to objections by Security Agencies 7. The objections raised by the Official Liquidator have been responded to by the respective agencies by pointing out that they were not themselves liable for ESI or Provident Fund at all, the Official Liquidator as being principal employer was liable for suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e were no security staff. While any lapse on the part of the security agency could entail removing the security agency or if there had been any loss occasioned by such lapse, there could have been a claim against such security agency for the loss that occurred if negligence was established, the general objections, which are raised to dispute the claim cannot be justified by the non-furnishing of details relating to payment of Provident Fund or ESI contributions. When the contention of the security agencies have been that they have not paid the ESI or Provident Fund, it will be begging the question to demand proof of such payments for realising the amounts claimed by them. As contended by the security agencies, the issue before this Court is not whether they were justified in not making Provident Fund or ESI contributions or an adjudication about who among the parties, viz., the Security Agencies or the Official Liquidator, was liable to make the contributions to Provident Fund Commissioner and ESI. While determining the issue of the eligibility of the security agencies, legitimately the office of the Official Liquidator could obtain proof of the list of persons who had been deplo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Ltd., the contention was that the empanelled security agency was only Industrial Security and Fire Services Bombay (P.) Ltd., and therefore, it was not entitled to prosecute the petition through an entity which had not been recognized by the Official Liquidator. Several communications between the parties clearly revealed that one of the Directors not supported Guardian Industrial Investigation and Security Services Ltd., and it was only Industrial Security and Fire Services Bombay (P.) Ltd., which was extending the services for the various factories and it was entitled to make the claim as a successor-in-interest. The issue need not detain us since at the time of argument, learned counsel appearing for the Guardian Industrial Investigation and Security Services Ltd. made a representation at the bar that he would have no objection if the bills are settled only in the name of Industrial Security and Fire Services Bombay (P.) Ltd. Even the objection that the petitions of some of the agencies are not supported by proper board resolutions cannot come in the way of satisfying the claims of the security agencies, since the claims originate from the terms of engagement and the services p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat have been paid by the secured creditors. 12. To prevent the repetition of the events of what has been happened now, the following guidelines are issued : ( a )The requirements as regards the individual companies in liquidation shall be jointly determined by the Official Liquidator in the immediate presence of the secured creditors and all the representatives of stakeholders over the asset owners of the company in liquidation. ( b )In determining the participants in the meetings for fixing the security personnel, due regard shall be had to the persons entitled to disbursements under sections 529A and 530 of the Companies Act. ( c )The choice of Security Agencies shall be made after advertisement in leading newspapers and a panel drawn from the respondents who not merely offer competitive rates but also of organisations that have a long track record of good performance in this field, preference being given to organisations that employ ex-servicemen. ( d )In the matter of approval of rates, the Official Liquidator shall have a realistic approach of insisting that the wages shall be the minimum wages as prescribed under the respective States where the factory premises ..... X X X X Extracts X X X X X X X X Extracts X X X X
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