Inspection of company records in winding-up proceedings was allowed on a liberal basis to protect the defence.

Inspection of books, records and documents in the custody of the official liquidator was treated as available to a contributory after a winding-up order under Rule 14A, and the procedure under the Companies (Court) Rules was to be followed as far as possible. The material referred to in the official liquidator's report, including the documents listed in Appendix I, was part of the evidentiary record for proceedings under section 549(1) of the Companies Act, 1956. A liberal approach was adopted so that the respondents were not deprived of a defence on technical grounds. Inspection was accordingly allowed of the Appendix I documents and other specifically identified documents in the official liquidator's possession, during office hours and in the presence of his officials.

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Issues: Whether the applicants were entitled to inspection of the books, records and documents in the custody of the official liquidator for use in proceedings under section 549(1) of the Companies Act, 1956, and whether the request could be confined only to specific documents mentioned in the pleadings.

Analysis: Rule 14A of the Companies (Central Government's) General Rules and Forms, 1956 permits inspection by a contributory after a winding-up order, and the Companies (Court) Rules, 1959 require the procedure of the Code of Civil Procedure, 1908 to be followed as far as possible. The documents and records referred to in the official liquidator's report, including those listed in the appendix to that report, formed part of the material relied upon in the proceedings. In proceedings of this nature, the respondents were treated as occupying a position analogous to accused persons, so a liberal view was warranted to avoid shutting out a defence on technical grounds.

Conclusion: Inspection was allowed in respect of the books and records mentioned in Appendix I to the auditor's report and such other specifically identified documents, if any, in the possession of the official liquidator. The official liquidator was directed to give inspection during office hours in the presence of his officials.

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