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In Re: Kalyanasundara Gounder and anr. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtChennai
Decided On
Reported inAIR1947Mad247; (1946)2MLJ241
AppellantIn Re: Kalyanasundara Gounder and anr.
Cases ReferredIn Rangai Goundan v. Emperor
Excerpt:
- - therefore, they were the persons who ought to give the necessary information as required by section 177-a(2)(a) and, therefore, they are the persons against whom proceedings should be taken if they failed to submit the account......the indian companies act, 1913. then the official receiver of coimbatore had been appointed as the official liquidator in respect of this winding up. that was on 16th december, 1943. the official receiver then called upon these two petitioners under section 177(a) to furnish information but as they did not furnish the information required they were prosecuted and sentenced as already stated.3. what is urged before me is that this is a case which went into voluntary liquidation and not a ease of a company which went into liquidation by order of the court, and therefore the provisions of section 177 of the act cannot be availed of. to this the short answer is that it is no doubt a company that was originally dissolved by voluntary liquidation and its name was struck off the registers but.....
Judgment:
ORDER

Kuppuswami Ayyar, J.

1. This is a petition to revise the order of the Additional First Class Magistrate of Coimbatore, convicting the petitioners under Section 177(5) of the Indian Companies Act and sentencing the first accused to pay a fine of Rs. 50 with one month's simple imprisonment in default, and the second accused to pay a fine of Rs. 25 with two weeks simple imprisonment in default.

2. These arise out of proceedings in connection with the winding up of a company known as the Kandagoundanchavadi Balachandra Ganesa Nidhi, Limited. There was a voluntary winding up of the company in 1934. A resolution was passed on 7th January, 1934, which was confirmed on 27th January, 1934. The first accused who was the Secretary was appointed the liquidator, and the second accused was also appointed as an additional liquidator. There was a third liquidator also whose whereabouts are not known. In 1936, it is stated, both the accused resigned their offices as liquidators. On 13th November, 1937, under Section 247(5)c of the Indian Companies Act the name of the Company was struck off. In 1941, P.W. 3 was appointed as liquidator in the place of accused 1 and 2; and P.W. 3 filed applications against accused 1 and 2 and took steps against them. In 1943 P.W. 3 took proceedings in this Court for getting the order, striking off of the company, set aside, and on 25th November, 1943, this Court passed an order restoring the name of the company in the register under Section 247(6), and that the said company after being restored as aforesaid be wound up by the Court under the provisions of the Indian Companies Act, 1913. Then the Official Receiver of Coimbatore had been appointed as the Official Liquidator in respect of this winding up. That was on 16th December, 1943. The Official Receiver then called upon these two petitioners under Section 177(a) to furnish information but as they did not furnish the information required they were prosecuted and sentenced as already stated.

3. What is urged before me is that this is a case which went into voluntary liquidation and not a ease of a company which went into liquidation by order of the Court, and therefore the provisions of Section 177 of the Act cannot be availed of. To this the short answer is that it is no doubt a company that was originally dissolved by voluntary liquidation and its name was struck off the registers but under the orders of Court the company was restored and the Court directed the winding up after such restoration. Therefore, on the date on which proceedings were taken and when the Official Liquidator called for information it was in respect of a company which was under liquidation by order of Court and the liquidator who was the person in charge at the time was appointed by the Court which directed the winding up of the proceedings. Thus, there is no force in the contention of the earned counsel for the petitioners that this should be treated as a case of a company wound up by voluntary liquidation and not by order of Court.

4. The next contention is that if it is considered to be a company wound up by order of Court, there was no jurisdiction for the Official Receiver to call for information from these accused as he had not obtained directions of the Court to so call for information. Reliance is placed upon Clause (2) of Section 77-A of the Act. Under Clause (1) of Section 177-A where the Court has made a winding up order, a statement has to be submitted. It is only in the second clause it is stated that the statement shall be submitted and verified by one or more of the persons-and in Clause (a) of that sub-section, it is stated that the statement shall be submitted by persons, who are or have been directors or officers of the company. Accused 1 and 2 were Official Liquidators of this company. In Rangai Goundan v. Emperor (1942) M.W.N. 101, it has been held by this Court that an official liquidator is an officer of the company. Therefore, they were the persons who ought to give the necessary information as required by Section 177-A(2)(a) and, therefore, they are the persons against whom proceedings should be taken if they failed to submit the account. It is true that there are the words 'subject to the direction of the Court' in Sub-clause (2) but that cannot be taken to indicate that these persons (accused) are liable to submit the accounts only when they had been called upon by the Court or the Court had directed the liquidator to furnish such a statement. It may be open to the Court to ask the Official Liquidator not to call for accounts if they are able to satisfy the Court that they are not in a position to submit the accounts; the liquidator will then act according to the directions that may have to be given by the Court. I do not think, therefore, that the words 'subject to the direction of the Court' can be taken to indicate that such persons who have been the officers of the Court can be called upon to submit the statement only if there is direction by the Court to such officers to submit the account. In this case these two accused are persons against whom there is evidence that they were in possession of records of the Court and when they were in possession of the records and when information was required from them they were the persons who were bound to give it. I am not, therefore, able to see anything unreasonable in their being called upon to submit an account and it cannot be said that the sentences is excessive.

5. The petition is dismissed.


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