Winding-up liability for use of company assets remains enforceable, with recovery to proceed through the Official Liquidator.
An accrued liability for monthly rentals or deposits arising from actual use of a company's industrial infrastructure remained enforceable against the company in liquidation, and the later purchase of the unit did not extinguish the earlier liability. The limitation objection based on Sections 446(2)(b) and 458A of the Companies Act, 1956 did not defeat the claim because relief was traceable to Section 468, which permits the Court after a winding-up order to require a person in control of the company's money or property to account for it. A creditor's direct application was incompetent after appointment of the Provisional Liquidator; the Official Liquidator was the proper party to pursue recovery.
Issues: (i) Whether the claim for monthly rentals or deposits due from October 2001 to 24.05.2005 could be enforced against the company in liquidation and whether the application by the Official Liquidator was barred by limitation; (ii) Whether the creditor's application seeking deposit of amounts from October 2001 onwards was maintainable after the appointment of the Provisional Liquidator and the winding-up proceedings.
Issue (i): Whether the claim for monthly rentals or deposits due from October 2001 to 24.05.2005 could be enforced against the company in liquidation and whether the application by the Official Liquidator was barred by limitation.
Analysis: The arrangement between the companies, as validated by the BIFR and affirmed in substance by the AAIFR, required regular monthly payment for use of the industrial infrastructure, and the liability crystallized for the period during which the unit was actually used. The Court held that the later purchase of the unit did not wipe out the accrued liability for the earlier period. As the company stood under winding up, the ordinary limitation plea based on Section 446(2)(b) of the Companies Act, 1956 and Section 458A of the Companies Act, 1956 did not defeat the claim, because the relief was traceable to Section 468 of the Companies Act, 1956, under which the Court may at any time after a winding up order require a person in control of the company's money or property to account for it.
Conclusion: The claim was enforceable, and the Official Liquidator's application was not barred by limitation.
Issue (ii): Whether the creditor's application seeking deposit of amounts from October 2001 onwards was maintainable after the appointment of the Provisional Liquidator and the winding-up proceedings.
Analysis: Once the Provisional Liquidator had been appointed, the company could not be represented by a creditor for a claim of this nature. The proper course was for the Official Liquidator to act on behalf of the company in liquidation. The creditor's application was therefore incompetent in the circumstances, whereas the Official Liquidator's application could be treated as one under the appropriate provision despite the wrong statutory reference.
Conclusion: The creditor's application was not maintainable, while the Official Liquidator's claim was maintainable under the proper provision.
Final Conclusion: The monthly payment liability for the use of the company's assets stood affirmed for the relevant period, but recovery had to proceed through the Official Liquidator under the winding-up framework, not through the creditor's application.
Ratio Decidendi: In winding-up proceedings, an accrued claim for use of the company's assets may be enforced under the Court's power to require delivery or accounting of company property, and limitation does not bar such a claim where the statute permits action at any time after the winding-up order.
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