9911796707
TMI Blog1978 (8) TMI 236X X X X Extracts X X X X X X X X Extracts X X X X ..... application are as follows: (2) M./S. Liberty Finance (P) Ltd. (now in liquidation and hereinafter referred to as the company) was carrying on the business of receiving deposits from the public and investing the same by financing the purchases vehicles by individuals on the basis of hire-purchase agreements. The company financed the purchase of a Tata Mercedes Benz by respondent No. 1 on the basis of hire-purchase agreement. Respondents No. 2 and 3 were guarantors of the due performance of the agreement by respondent No. 1 and they also signed the hire purchase agreement in favor of the company. They also signed guarantor's proposal forms in respect of the above transaction. As per the accounts of respondent No. 1 with the company the amount payable by the respondent was ₹ 16,640'.00 repayable in one Installment of ₹ 701.00 followed by 23 equal Installments of ₹ 693/. The first Installment was payable on or before 7th September, 1964 and the subsequent Installments were payable on the 7th of each and every succeeding month. In case of default of payment the respondents were also liable to pay interest at 2 per cent per mensem on the hire monies and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the balance sum of ₹ 10,000.00 the Company got various documents, including the alleged Hire Purchase Agreement, signed in blank by the respondents. As the vehicle was of 1955-1956 Model, it could not be plied with profit as the cost of wear and tear was more than its earnings. The company however seized, the vehicle after about a year and so after it was let to respondent No. 1 and transferred it to some one else, having got the Hire Purchase endorsement in the Registration book of the vehicle cancelled by the R. T. O., Agra. The Claim of the Official Liquidator is unfounded and no amount whatsoever, is payable by any of the respondents in respect of the vehicle in question. The accounts relied upon by the Official Liquidator are altogether false and fabricated. The entries made by the Company in its Books of Accounts are altogether false. In any case, the claim of the Company is time barred. (4) As stated earlier the applicant filed a rejoinder on 2nd May, 1977 and thereafter followed it by C. A. No. 518177. By the latter application he prayed that the delay in the filing of C. A. No. 137/74 may be condoned under Section 5 of the Limitation Act. The grounds on which t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Anand J. in Official Liquidator of Security Finance (P) Ltd. Vs. Pushpawati Puri 1977 R.L.R. 391. The effect of these decision can be summarised as follows: (A)The expression 'any claim' occurring in Section 446(2)(b) means a claim which is legally enforceable. A claim which had become time barred on the date of presentation of the winding up petition cannot be described as a legally enforceable claim and the provisions of Section 446(2)(b) do not enable the Official Liquidator to revive claims which had been quietened by the lapse of time. (b) Where there is an enforceable claim as on the date of the winding up petition, the official liquidator can make an application under Section 446(2). Such an application will attract the provisions of Article 137 of the Limitation Act, 1963 in view of the decision of the Supreme Court in the case of Kerala State Electricity Board, Trivandrum Vs . T. P. Kundaliumma,: [1977]1SCR996. ( c) The right of the Official Liquidator to make an application under Section 446 arises on the date when the winding up order is passed. Reading Section 458-A of the Act and Article 137 of the Limitation Act together, such an application by the Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contents of application C.A. 518/77 which was filed on 19th July, 1977 together, it is clear that the awareness that Article 137 would apply also to petitions under Section 446 came to the applicant only about this lime. The question is whether these circumstances would justify the condensation of delay in the filing of the application. This issue has been touched upon by Anand J. in the decision earlier preferred to in para 12: The first of these subsidiary question is as to whether in the rather nebulous state of the law of limitation in relation to proceedings under the Act even after the Act of 1963 in view of the decision of the Supreme Court in the case of Town Municipal Council. Athani (Supra), and until the controversy was laid to rest in the decision of the Supreme Court in Kerala State Electricity Board (Supra), it could be said that a person applying under the provisions of the Act had sufficient cause for not preferring the application within the period of limitation provided by Article 137 and he, Therefore, is entitled to the extension of the period prescribed by that Article. True, Article 137 was vide enough to include within its ambit applications under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dents refuse to redeliver the vehicle, relying on a decision of Kapur J. in C.A. 670/73. I Therefore turn to the issues regarding the merits of the claim. The main objection taken on behalf of the respondents is that the hire purchase agreement which is Annexure 'A' to the application has been signed in blank. The annexure in question has not been filled in though it has been signed by all the respondents. However, in view of the oral evidence given in this case. this defect does not affect the merits of the applicant's claim. The former managing director of the company. Shiv Dayal. stated that this was not the original of the hire-purchase agreement which had been completed and signed by every one. whereas Annexure 'A-1' is not signed by him. The suggestion on behalf of the applicant is that the original hire-purchase agreement which had been signed by all has been lost or misplaced. It is. however, seen that the respondents have admitted the hire purchase transaction. Murlidhar, respondent No. 3 has. stated that the truck was purchased by Radhey Mohan on hire-purchase agreement from the company and that he was the guarantor. The second respondent Manohar Lal, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the amounts due to the company in respect of this transaction. I have held earlier that there is no substance in the contention that the accounts of the company were fabricated or false. At the same time, there is an onus on the applicant to prove that a sum of ₹ 16,640.00 had been advanced to the principal debtor in connection with the hire-purchase of the truck. Apart from the opening entry in the statement of account (Annexure B) on 7-8-74 to the effect that an amount of ₹ 16,640.00 was due from the respondents, there is no indication regarding the date or mode by which the amount was advanced to the respondent. No evidence such as a cheque counter-foil or receipt or the like has been produced. Respondent No. 2 has stated that the actual sum received from the company was only a sum of ₹ 10,000.00 and that the balance of ₹ 5,000.00 had been contributed by he hirer. Having regard to the fact that the hire-purchase agreement filed on behalf of the applicant remains blank, the respondents could perhaps have completely denied the transaction. But they have come forward to admit the transaction and to state that they had received moneys from the company for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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