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Issues: (i) Whether an application under section 468 of the Companies Act, 1956 for directing former directors to produce books of account and a debtors' ledger was barred by limitation or otherwise not maintainable; (ii) whether the company in liquidation was prima facie entitled to the debtors' ledger for 1995-1996 and other records so as to justify a direction for their delivery.
Issue (i): Whether an application under section 468 of the Companies Act, 1956 for directing former directors to produce books of account and a debtors' ledger was barred by limitation or otherwise not maintainable.
Analysis: Section 468 empowers the Company Court, at any time after a winding up order, to require contributories and officers or employees of the company to deliver money, property, books and papers in their custody or control to which the company is prima facie entitled. The provision is framed in clear terms and is not confined by any limitation period. The scheme of section 456 and Rule 114 also shows that the liquidator is to take custody of available property and records, and if necessary may seek assistance for delivery of such assets. The plea that the application was time-barred therefore could not be accepted.
Conclusion: The objection based on limitation and lack of competence was rejected.
Issue (ii): Whether the company in liquidation was prima facie entitled to the debtors' ledger for 1995-1996 and other records so as to justify a direction for their delivery.
Analysis: The evidence showed that the available assets and records had already been taken over by the liquidator, while the missing ledger was not shown to have remained in the respondents' custody. The correspondence relied upon by the liquidator did not establish withholding of the specific ledger. On the contrary, the materials indicated that several records had been destroyed by militant labour or workers. Section 468 permits delivery only of books and papers to which the company is prima facie entitled, and section 456 similarly proceeds on the basis of records that are available. Where the records are destroyed or no longer exist, the Court cannot compel performance of an impossible act. The principle lex non cogit ad impossibilia applies, and a direction for production would also expose the respondents to criminal liability for non-compliance in circumstances beyond their control.
Conclusion: The company was not shown to be prima facie entitled to the missing ledger and no direction for production could be issued.
Final Conclusion: The application failed because the Court could not compel production of records that were not proved to be available or in the respondents' custody, and the request was accordingly dismissed.
Ratio Decidendi: A direction under section 468 of the Companies Act, 1956 can be made only in respect of books and papers to which the company is prima facie entitled and that are capable of being delivered; limitation does not bar such an application, but the Court will not order impossible performance where the records are shown to be unavailable or destroyed.
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