Misfeasance relief in winding-up may compel return of company books retained by an officer without separate proof of quantified loss.

In winding-up proceedings under Section 235 of the Indian Companies Act, 1913, the High Court of Madras stated that misfeasance relief could extend to restoration of company property retained by an officer. The provision was read broadly to cover repayment, restoration, or compensation where an officer had misapplied or retained company assets. The Court also noted that proof of a separately quantified pecuniary loss was not essential where the continued withholding of company books itself caused loss to the company. On that reasoning, the order requiring delivery of the books was upheld and the appeal was dismissed.

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Issues: Whether an order could be passed under Section 235 of the Indian Companies Act, 1913 directing delivery of company books retained by an officer, and whether proof of a quantified loss to the company was necessary before such an order could be made.

Analysis: Section 235 empowered the Court, in winding-up proceedings, to compel an officer who had misapplied, retained, or become liable or accountable for company property to repay or restore that property, or to contribute compensation. The provision was broader than the corresponding English section and expressly covered restoration of property. Although the section contemplated loss to the company, retention of books belonging to the company necessarily involved loss, even if the loss was not separately quantified. The retained books had value to the company, and their continued withholding justified relief under the section.

Conclusion: The order directing delivery of the books was valid, and the appeal failed.

Final Conclusion: The Court affirmed that misfeasance relief under the winding-up provision extends to restoration of company property retained by an officer where such retention causes loss to the company, and the appeal was dismissed.

Ratio Decidendi: Under the misfeasance jurisdiction in company winding-up, the Court may order restoration of company property retained by an officer when that retention causes loss to the company, and a separately quantified pecuniary loss is not a precondition to such relief.

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