Extension of Official Liquidator tenure rejected where no statutory power existed to continue an expired appointment.

An expired appointment of an Official Liquidator or Official Receiver could not be continued after the original tenure ended, especially where a successor had already been appointed. Rule 9 of the Company Court Rules did not authorise extension of the earlier appointee's term, and Section 524 of the Companies Act was confined to appointment of additional liquidators rather than continuation of an expired appointment. The Court also noted that the relevant power under Section 57 of the Provincial Insolvency Act lies with the Government, not the Court. The order permitting continuance of the earlier appointee was therefore unsustainable and was set aside.

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Issues: Whether the continuation or extension of the term of an Official Liquidator and Official Receiver after expiry of the original tenure could be sustained under the Company Court Rules and the Companies Act.

Analysis: The appointment in question had expired, and a successor Official Receiver had already been appointed. The Court held that Rule 9 of the Company Court Rules could not be invoked to continue the earlier appointee after expiry of term. It further held that Section 524 of the Companies Act did not authorise such continuation, as that provision permits appointment of additional liquidators and not extension of the tenure of an existing Official Liquidator. The Court also noted that Section 57 of the Provincial Insolvency Act confers the relevant power on the Government, not on the Court.

Conclusion: The continuation of the earlier Official Liquidator was not legally sustainable, and the impugned order was liable to be set aside.

Final Conclusion: The appeal succeeded, and the order permitting continuance of the earlier appointee was set aside.

Ratio Decidendi: In the absence of statutory authority, the Court cannot extend the tenure of an Official Liquidator or Official Receiver by resort to the Company Court Rules or by treating provisions for appointment of additional liquidators as a power to continue an expired appointment.

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