Call-money liabilities in winding up fall under section 187, not section 186, for recovery of unpaid share money.

Section 186 of the Indian Companies Act, 1913 does not extend to unpaid share money payable by virtue of a call made under the Act, including calls made before winding up. The scheme of sections 156, 159, 186 and 187 shows that unpaid share capital remains a statutory liability, but call money is treated separately from other debts due from a contributory. Section 187 provides the proper machinery for making and recovering all call-money liabilities during winding up, including arrears of pre-liquidation calls. A harmonious construction therefore limits section 186 to debts other than call money and places unpaid called-up share amounts within section 187.

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Issues: Whether a liquidator can invoke section 186 of the Indian Companies Act, 1913, to recover unpaid share money in respect of calls made by the company before winding up, or whether such claims fall exclusively within section 187 of the Act.

Analysis: Section 186 is confined to monies due from a contributory other than money payable by virtue of any call in pursuance of the Act. Section 187 provides the machinery for making calls and recovering all call monies needed in winding up, including unpaid amounts on shares where calls were already made before liquidation. The liability for unpaid share capital, whether already called or still uncalled, is a statutory liability under section 156, and section 159 treats such liability as a debt. The distinction between a debt and call money does not alter the essential character of a pre-liquidation call as call money. A harmonious construction of the provisions shows that section 186 covers other debts due from a contributory, while section 187 covers all claims for call money, including arrears of calls made while the company was a going concern.

Conclusion: The liquidator cannot proceed under section 186 for recovery of the unpaid call money in question; the proper provision is section 187. The appeal is therefore against the appellant and in favour of the respondent.

Ratio Decidendi: Section 186 does not apply to unpaid share money that is payable by virtue of a call made under the company law regime, including calls made before winding up; such claims fall within section 187 as call-money liabilities.

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