S. Barman, J.
1. This is an application by the Liquidator of the Koshal Industries Development Syndicate Ltd. under Section 518 of the Indian Companies Act, 1956 (Act 1 of 1956) for determination of two questions, namely,
(i) Whether the Liquidator can validly pay to the auction-purchaser Share-holders the first return in pursuance of the declaration referred to in the petition;
(ii) If the Hon'ble Court decides that the first return is payable to the opposite parties, should the liquidator refund the purchase money to the auction purchasers and exercise lien for dues afresh on shares of apposite parties arising out, of the facts and circumstances as stated in the petition of Liquidator.
2. The relevant facts are these: On August 17, 1945 the said Company was registered under the Indian Companies Act VII of 1913. On April 7, 1956 the Company sold 300 fully paid-up shares of Rs. 10/- each belonging to one Jugal Kishore Pansai (opposite party No. 2 herein) by auction for a sum of Rs. 900/-. On June 28, 1956 the said auction sale was confirmed by a Resolution. On September 5, 1958 the said Jugal Kishore Pansari filed a suit in the Court of the Subordinate Judge Bolangir being Title Suit No. 20 of 1958, challenging the said auction sale of the shares and for a declaration that he is still the holder of the said 300 shares. On February 21, 1959 the Company went into voluntary liquidation and the liquidator was appointed therein. On June 25, 1959 notice of first return of dividend was given by the liquidator. The liquidator's present application under Section 518 is for determination of the said questions arising out of the facts stated above,
3. Mr. Ranjit Mohanty, learned counsel for the opposite party No. 2 Jugal Kishore Pansari, opposing the liquidator's application, raises a point that this application is not maintainable, on the ground that the said questions are beyond the scope of Section 518, inasmuch as they involve going into questions of fact, which is outside the scope of the sadd section. The leaned counsel contended that the said auction sale by the company of the 300 shares is being challenged by the opposite party No. 2 Jugal Kishore Pansari; and in fact he had already filed a Title suit in the court of the Subordinate Judge, Bolangir as aforesaid, which remains now stayed until the disposal of the present application. The learned counsel submitted that the various grounds, on which the auction sale is being challenged, are all primarily questions of fact.
4. Mr. H. G. Panda, learned counsel appearing for the Liquidator, fairly conceded that if, indeed, finding of fact is involved in determining the aforesaid question, then the Court cannot determine such question, stated to be so dependent on such finding of facts which is outside the scope of Section 518. The learned counsel, however, submitted that theCourt can give some opinion if the questions are recast The learned counsel also gave an indication of the nature of questions he proposed to place before the Court for determination, namely, regarding the validity of Article 8A of the Articles of Association by virtue of which the Company sold the said shares. The Court cannot give any opinion cat any hypothetical proposition. It will be only academic to enter into any such discussion. However, so far as the present application is concerned, I am of opinion that the scope of Section 518 being limited, this Court cannot determine the said questions which primarily involve finding of facts.
5. In this view of the legal position as to which there is no dispute, and having regard to the nature of the questions for determination in this application, which in my opinion involve finding of facts, the present application, -- as it stands, -- is not maintainable. The Liquidator is, however, at liberty to make any appropriate application for determination of proper questions under Section 518, as he may be advised, according to law.
6. In conclusion, this application stands dismissed; but in. the circumstances of the case without costs. The orders of stay of further proceedings in Title Suit No. 20 of 1958 and Money Suit No. 11 of 1957 both on the file of the Subordinate Judge, Bolangir, stand vacated. The learned Subordinate Judge, Bolangir, is directed to dispose of the said suits as expeditiously as possible, as requested by the Liquidator, I must make it clear that nothing in this judgment is binding on the learned Subordinate Judge, who is to decide the suits according to law.