2019 (7) TMI 106 - HC - Companies Law

Official Liquidator to Release Sale Funds with Workmen Dues

Tata Capital Ltd. Versus M/s. Turbo Bharath Ltd., In Liq.

The Court directed the Official Liquidator to release the sale consideration amount of Rs. 2.15 Crores subject to depositing workmen dues. The applicant's ... Release of amount received as sale consideration from the sale of Lot No.1 along with interest accrued on the said amount - company under liquidation - requirement on the part of applicant that the applicant deposits the workmen dues as computed under Section 529-A of the Companies Act, 1956 - HELD THAT:- The only impediment for releasing the amount is that the appellant has not made a fresh claim as directed by this Court in Company Appeal No.9 of 2015, dated 06.10.2015. A perusal of the order dated 06.10.2015 passed in Company Appeal No.9 of 2015 does not indicate that the intention of the Court in directing the Official Liquidator to adjudicate the claim of the appellant by entertaining a fresh claim is not to once again undertake adjudication process for determination of the amount payable, as the amount initially determined by the Official Liquidator through Form 69 dated 08.06.2015 has been set aside by this Court in Criminal Appeal No.9 of 2015, dated 06.10.2015 - the entitlement amount that has to be paid to the appellant stands determined and now what all is required to be done is the disbursal of the entitled amount. The order dated 06.10.2015 needs to be understood in the context of the material on record and the developments which have taken place. The Official Liquidator is directed to take necessary steps for disbursal of the amount lying to the credit of the company in liquidation - application allowed. Issues:1. Application to direct Official Liquidator to release sale consideration amount.2. Filing of counter affidavit by Official Liquidator.3. Adjudication of claim by Official Liquidator.4. Appeal against rejection of claim.5. Direction to sell balance secured asset and entertain fresh claim.6. Failure to make a fresh claim by the appellant.7. Interpretation of Court's direction on adjudication of claim.8. Disbursal of entitled amount to the appellant.9. Liquidation process and necessary steps by Official Liquidator.Analysis:1. The application sought the Court's direction for the release of Rs. 2.15 Crores received from the sale of Lot No.1 by the Official Liquidator, subject to the condition of depositing workmen dues as per Section 529-A of the Companies Act, 1956.2. The Official Liquidator filed a counter affidavit requesting to accept the same and directed the applicant to file their claim afresh.3. The applicant, M/s Tata Capital Ltd., initially claimed Rs. 25,49,62,494/-, which was later adjudicated by the Official Liquidator. The claim was partially admitted to the extent of Rs. 9,94,47,759/- with interest, and the remaining amount was rejected.4. Aggrieved by the rejection, the applicant filed an appeal which was allowed by the Court, directing the Official Liquidator to sell the balance secured asset, entertain a fresh claim, and adjudicate it accordingly.5. The failure of the appellant to make a fresh claim hindered the release of the amount by the Official Liquidator, as directed by the Court in the previous appeal judgment.6. The Court clarified that the previous order did not intend to reinitiate the adjudication process but aimed at disbursing the entitled amount determined through the appeal judgment.7. Consequently, the Court directed the Official Liquidator to take necessary steps for disbursal of the amount, noting that no other claimants needed adjudication, and the liquidation process should proceed with the required forms to be filed within two weeks.8. The judgment emphasized the need for understanding the context and developments in interpreting the Court's directions for the disbursal of the entitled amount to the appellant, ensuring compliance with the legal procedures for liquidation.