Official liquidator's power to arbitrate company disputes depends on express statutory authority, not implied winding-up powers.

An official liquidator's powers under section 179 of the Companies Act, 1913, to sue, defend, and take acts necessary for winding up did not include an implied power to refer company disputes to private arbitration, even with court sanction. Section 152, allowing a company to refer matters to arbitration, was treated as limited to arbitration under the Indian Arbitration Act and not as authority for a liquidator. The absence of any express power to arbitrate, contrasted with the express power to compromise claims under section 234, supported the view that such authority was not intended. The application for permission to refer the dispute to private arbitration was refused.

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Issues: Whether an official liquidator, with sanction of the Court, can refer a dispute of the company in liquidation to private arbitration.

Analysis: The power of an official liquidator under section 179 of the Companies Act, 1913, to institute or defend legal proceedings and to do other acts necessary for winding up was held not to include a power to refer disputes to private arbitration. Section 152 of the same Act, which permits a company to refer matters to arbitration, was treated as confined to arbitration under the Indian Arbitration Act and not as authority for an official liquidator. The absence of any express power of reference to arbitration, contrasted with the express power to compromise claims under section 234, indicated that the legislature did not intend such a power to exist. The principle that disputes under section 92 of the Code of Civil Procedure, 1908, are not fit subject-matter for private arbitration was also considered applicable.

Conclusion: The application for permission to refer the dispute to private arbitration was refused.

Ratio Decidendi: An official liquidator has no implied authority, even with the Court's sanction, to refer a company dispute to private arbitration unless the statute expressly confers that power.

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