Court permits 4% interest on ex-employees' claims, eases payment process for scattered members The court granted permission for the Official Liquidator to declare interest at 4% per annum on claims by ex-employees of the company in liquidation, ...
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Court permits 4% interest on ex-employees' claims, eases payment process for scattered members
The court granted permission for the Official Liquidator to declare interest at 4% per annum on claims by ex-employees of the company in liquidation, dispensing with the publication of notice of declaration. The court directed the Official Liquidator to work with an association to facilitate payments to scattered ex-employees, with funds to be transferred to the association for distribution to members providing necessary details. Additionally, the Official Liquidator was allowed to transfer unclaimed dividend in compliance with the Companies Act and open a separate dividend account. Detailed instructions were provided for timely payment processing.
Issues: 1. Permission to declare interest on claims made by ex-employees of a company in liquidation. 2. Dispensation of publication of notice of declaration. 3. Facilitation of payment to ex-employees through an association. 4. Transfer of unclaimed dividend in compliance with the Companies Act. 5. Leave to open a separate dividend account.
Analysis: 1. The Official Liquidator filed OLR 391/2014 seeking permission to declare interest at 4% per annum on claims made by ex-employees of the company in liquidation, as directed by a previous court order dated 11.01.2013. The request included dispensation of Form 137 publication and sending Form 138 by 'speed post' instead of 'under certificate of posting'.
2. The court permitted the interest declaration at 4% per annum and granted dispensation of publication of notice of declaration in Form 137. However, further permissions required consideration in light of Company Application No. 1348/2014 filed by an association seeking payment facilitation to its scattered members.
3. To address the scattered ex-employees' situation, the Official Liquidator was directed to deliver Form 138 to the association's office bearers for securing necessary details, including bank account numbers, to facilitate RTGS payments. Payment would be made to the association on behalf of its members. If all details were not furnished, payment would be made only for employees with provided information.
4. Regarding unclaimed dividend, the Official Liquidator was permitted to comply with Section 555 of the Companies Act. Leave was granted to open a separate dividend account in Punjab National Bank, Hudson Circle, Bangalore for the specified amount.
5. To ensure timely action, the association's office bearers were instructed to contact the Official Liquidator's office within two weeks, providing necessary documents. Subsequently, the association had two weeks to submit employee details for payment processing, with the Official Liquidator required to transfer funds to employees' accounts within two weeks of receiving the necessary forms.
In conclusion, the court disposed of OLR 391/2014 and CA.No. 1348/2014, providing detailed instructions for the Official Liquidator and the association to facilitate the payment process for ex-employees of the company in liquidation.
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