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TMI Blog2012 (5) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... from the deposits which were available in the bank the Directors cannot be held directly responsible of the acts in adjusting the amount available with them and the Directors in no way could have prevented the same - with regard to the loans and advances the witness (PW-1) has admitted that these are the statutory deposits and are recoverable and it can still be recovered in accordance with law and the same cannot be considered as an act of misfeasance to hold that the respondents are guilty – against Official Liquidator - COMPANY APPLICATION NO. 1024 OF 2004, COMPANY PETITION NO. 39 of 1995 - - - Dated:- 9-3-2012 - A.S. BOPANNA, J. K.S. Mahadevan and V. Jayaram for the Applicant. C. Shashikantha and Vishwanath R. Hegde for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isputed by the respondents and they have given an explanation that they have not committed any act of misfeasance and that there is no specific pleading to that effect. Even in respect of the amounts which were due to be recovered by the company-in-liquidation, sufficient reasons have been indicated in the objection statement with regard to the action taken by the respondents to reduce the financial burden of the company and also with regard to certain adjustments which were made by the Bankers in respect of the other loans. Thus it is contended that the prayer made in the application is not sustainable and the same is required to be rejected. 5. In the light of the rival contentions put forth, the matter was set down for recording the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of what has been stated in the application. In that regard, the claim as put forth is based on the balance sheet dated 31.03.1996 wherein a sum of Rs. 4,92,022/- was indicated as the amount due by the sundry debtors, a sum of Rs, 1,45,135/- was indicated under the head cash/bank balances and a sum of Rs. 2,16,320/- under the head of loans and advances. Except for referring to the said entries, there is no further evidence tendered on behalf of the applicant. 9. A perusal of the cross-examination of P.W. 1 would indicate that except for referring to the said documents, the witness has not made any further inquires with regard to the claim put forth. In that light, specific suggestions have been put to the said witness with regard to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent No. 1 who was examined as RW1 has elaborated this aspect of the matter. Further, with regard to the amount indicated as due from sundry debtors, it has been pointed out that the amount which was due as on 31.03.1995 was nearly Rs. 15 lakhs and by the time, the balance sheet was filed indicating the amount due as on the date of winding up, nearly 11 lakhs has been recovered from various debtors and the amount which was due from sundry debtors, cash/bank balances was only Rs. 4,92,022/-. However, since the said debtors were also in financial doldrums, no efforts could be made at that stage to recover. If recovery proceedings were to be instituted, the company would have had to incur further expenses which the Company-in-liquidatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the winding up petition i.e. , on 02.03.1995. However, from the evidence of the said witnesses, it is shown that the said adjustments have been made unilaterally. It is also contended on behalf of the Official Liquidator that the outstanding amounts from the sundry debtors in any event should have been recovered by the Directors and since no action had been initiated by them and the said debts have become time-barred, the Directors should be held liable. The said contention is opposed by the learned counsel for the respondents. 15. In this regard, I am of the view that insofar as the sundry debtors, keeping in view the scope of Section 543 of the Act and having noticed the fact that within the period of one year between the two bal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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