TaxTMI Login
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →Just a moment...
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether amounts due from persons placed on the liquidator's list of contributories can be made the subject of calls by the liquidator in a voluntary winding up; (ii) Whether the Court should, under section 216 of the Indian Companies Act, directly enforce the liquidator's calls without requiring the liquidator to bring separate suits.
Issue (i): Whether amounts due from persons on the liquidator's list of contributories constitute calls payable in voluntary winding up.
Analysis: Sections 156 and 158 of the Indian Companies Act create contributory liability on winding up and define contributories. Sections 159 and 187 provide that calls by the liquidator create debts payable at the times specified and that the Court has power to make calls in liquidation. Authorities and text distinguish calls made by directors before winding up from calls made by a liquidator after winding up; on winding up the liability of members in respect of unpaid shares arises ex lege and may be enforced as calls by the liquidator.
Conclusion: The amounts, assuming the persons were rightly placed on the list of contributories, could be made the subject of calls by the liquidator and so were enforceable as such.
Issue (ii): Whether the Court should exercise its power under section 216 to enforce the liquidator's calls by immediate order without requiring the liquidator to file suits.
Analysis: Section 216 empowers the liquidator in voluntary winding up to apply to the Court to enforce calls. Although the liquidator has the right to make calls and the amounts are calls under the Act, respondents raised defenses and factual issues requiring inquiry. The Court may decline to grant summary enforcement where factual matters and defenses require trial, leaving the liquidator to litigate in suits to establish liability.
Conclusion: The Court declined to direct immediate enforcement under section 216 in the present case and directed that the liquidator file suits to recover the amounts; the earlier judge's refusal to treat the demands as calls was reversed as to law but the direction to file suits is not interfered with.
Final Conclusion: The decision establishes that unpaid amounts by persons properly on a liquidator's list of contributories are calls enforceable by the liquidator under the Companies Act, but a court may refuse summary enforcement under section 216 where factual disputes or defenses exist, permitting the liquidator to proceed by suit.
Ratio Decidendi: On winding up a company's liability of members in respect of unpaid shares arises ex lege under section 156 and, where a person is rightly placed on the list of contributories, the liquidator may make calls enforceable by the Court; however, summary enforcement under section 216 is discretionary and may be refused where contested factual issues require trial.
TaxTMI 
TaxTMI 
