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TMI Blog2012 (10) TMI 551X X X X Extracts X X X X X X X X Extracts X X X X ..... n is that in 1999 she had resigned from the company and had consequently migrated to the USA where she is presently residing. 2. Certain dates are relevant which are also undisputed. The applicant had given her letter seeking resignation from the bank on 25.10.1999 which was accepted by the Board of Directors on 30.10.1999. Form 32 had been filed by the company before the Registrar of Companies (ROC) on 26.11.1999 wherein a perusal of the Form shows that herein also the applicant has been described as a nominee director. The winding up proceedings of the company were initiated on 24.11.2003 and the company was finally wound up on 28.07.2004. Admittedly on the 'relevant date' i.e. on the date of winding up order which was on 28.07.2004 and even on the date of filing of the winding up petition which was on 24.11.2003, the applicant Ms Radhika S. Minocha was not a Director of the company; her resignation having been accepted by the company on 30.10.1999. 3. Relevant would it be to state that a similar application had been filed by the applicant which was Co. Application. No. 902/2010 seeking a discharge on the same ground but since Form 32 had not been filed at that stage and the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gful prosecutions should be avoided. 6. Learned counsel for the petitioner has placed reliance upon a judgment of the Karnataka High Court in Mother Care (India) Ltd. v. Prof. Ramaswamy P. Aiyar [2004] 51 SCL 243 as also another judgment of the Kerala High Court K. Subramony Kerala Financial Corpn. v. D.L. Malabar Phyto Chemicals Ltd. [Co. Appeal nos. 4 to 9 of 2004, dated 2-1-2009] submission being that directors appointed by the Financial Institutions to the Board of directors of a liquidated company and their appointment being only to protect the interest of the Financial Institution which has advanced funds to the company, such a nominee director has no role in the filing of the statement of affairs before the Official Liquidator. To support this same submission, reliance has also been placed upon a judgment of this Court dated 07.03.2012 Crl. O. CO. No. 13/2008 titled Phoenix Fine Chem (P.) Ltd. v. Samir Omesh Karnik. 7. Submissions have been countered by the learned counsel for the respondent; attention has been drawn to the language of Section 454 of the said Act and particular emphasis has been laid on Section 454(2)(a) of the said Act; arguments have been predicated on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ator to get himself apprised without any delay of all the relevant facts relating to the affairs of the company. The statement of affairs is undoubtedly an important document for the Official Liquidator to ascertain the assets and liabilities of the company and to expedite the realization and distribution of its assets. The words „ subject to the directions of the Court‟ imply that the Court may give such directions to the Official Liquidator in exercise of its powers and if any directions are given, the powers of the Official Liquidator must be exercised in conformity with such directions. 11. In Beejay Engg. (P.) Ltd., In re [1983] 53 Comp. Cas. 918 (Delhi) a Division Bench of this Court has answered two questions of vital import which had been referred to them. The second question is relevant for the controversy before this Court and reads herein as under:- "Whether, while exercising jurisdiction under s. 633 of the Act, the court can justifiably draw any distinction amongst the directors who are on the Board purely by virtue of their technical skill or expertise or because they represent certain special interests and those who are in effective control of the manag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Act, 1957 (hereinafter referred to as SFC Act); as noted earlier the Companies Act has made no such distinction in this legislation i.e. no distinction has been drawn between a nominated director or any other director. 16. Thus the submission of the learned counsel for the petitioner that the applicant should be absolved as she was only a nominee director of the company is not ipso facto by itself a ground to discharge the applicant of all liability. 17. It is however not in dispute that the applicant had resigned from the company on 30.10.1999; Form 32 had been filed by the company before the office of ROC on 26.11.1999; winding up proceedings had been initiated on 24.11.2003; the company was finally wound up only on 28.07.2004. It is thus evident that four years prior to the date of initiation of winding up proceedings, the applicant was no longer a director of the company. Much emphasis has been laid by the learned counsel for the Official Liquidator on the provisions of Section 454(2)(a) of the said Act; submission being that all the erstwhile "officers" which also includes a director are liable to file the statement of affairs in the absence of which prosecution must foll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ven refused to sign the provisional balance-sheet for being submitted to the Punjab National Bank in December, 1966. In this view of the matter, asking such a person to file a statement of affairs is an exercise in futility and we see no reason why a mere academic order should be passed." [Emphasis supplied] 19. In Jagjit Singh Sawhney (Supra), a Bench of this Court had noted that where the books of the company are not available to the director who is required to file the statement of affairs, it would be a reasonable excuse for him in not submitting the statement of affairs of the company ordered to be wound up. In this context, it had noted inter-alia as follows:- "The appellant, as we have already noticed, has been held not to be in a position to have access to the books of the company ever since he was ousted from the management. In these circumstances, calling upon him to file the statement of affairs cannot be justified. Indeed, it cannot be justified for any of the persons unless a clear-cut finding is given that any one of the persons concerned is in a position to or capable of filing the statement of affairs. Such an enquiry is an imperative prerequisite for giving direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... affairs of the company; significantly no question has also been put to her that she being in possession of the books and accounts of the company was evading her statutory duty. It has also come on record that the applicant had in fact resigned from the company in her capacity as a nominee director more than four years ago. It is also a part of the record that Mr. S.P. Nagarkatte was another director of the company and his statement had been recorded under Rule 130 of the said Rules on 19.02.2004; in para 4 of the present petition (Crl.(o) No. 5/2008), the Official Liquidator has specifically stated that Mr. S.P. Nagarkatte had stated in the said statement that he was a nominee director of the ICICI Bank; relevant would it be to state that Mr. S.P. Nagarkatte has not been arrayed as an accused in the aforenoted proceedings; no prosecution has been launched against him. 22. It is not for the Official Liquidator to adopt a pick and choose policy; he is a statutory body and must maintain transparency. He has admittedly not launched prosecution against Mr. S.P. Nagarkatte having accepted his statement recorded under Rule 130 of the said Rules that he was only a nominee Director of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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