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Issues: (i) Whether recognition granted under section 43 of the Displaced Persons (Debts Adjustment) Act, 1951 could be questioned in these proceedings and whether the court retained jurisdiction; (ii) whether the voluntary liquidators could settle contributories and make calls without prior sanction of court and whether the petition was maintainable despite execution by one liquidator; (iii) whether the call sought to be enforced was barred by limitation; (iv) whether alleged defects in the winding-up procedure and notice invalidated the proceedings.
Issue (i): Whether recognition granted under section 43 of the Displaced Persons (Debts Adjustment) Act, 1951 could be questioned in these proceedings and whether the court retained jurisdiction.
Analysis: The recognition order had been passed after inquiry by the Registrar and no appeal had been taken to the State Government. The statutory language barred any challenge to the Registrar's order in any court. On recognition, the company was deemed to have been formed and registered under the relevant law in India, and the statutory fiction had to be carried to its logical conclusion. The consequence was that the company could not be treated as a foreign company for the purpose of defeating jurisdiction.
Conclusion: The objection to jurisdiction failed and the issue was decided in favour of the petitioner.
Issue (ii): Whether the voluntary liquidators could settle contributories and make calls without prior sanction of court and whether the petition was maintainable despite execution by one liquidator.
Analysis: In voluntary winding up, the liquidator was empowered to settle the list of contributories and make calls under the Companies Act, and prior court sanction was not required for those acts. The absence of one liquidator's signature on the petition was also cured by the record, which showed a duly executed power of attorney by both liquidators and a request to amend the heading. No substantial defect in maintainability was established.
Conclusion: The objections to maintainability and authority failed and the issue was decided in favour of the petitioner.
Issue (iii): Whether the call sought to be enforced was barred by limitation.
Analysis: The earlier pre-liquidation call of 1947 would have been time-barred if enforced as such, but the liquidators had made a fresh call after winding up to regularise the arrears. The liability after winding up was statutory and arose ex lege, not as an ordinary contractual debt. On that footing, the claim was not barred in the manner contended by the respondents.
Conclusion: The limitation objection failed and the issue was decided in favour of the petitioner.
Issue (iv): Whether alleged defects in the winding-up procedure and notice invalidated the proceedings.
Analysis: The notice of the winding-up meeting was substantially complied with, and any irregularity in proxy timing did not show prejudice. Any defect in publication under section 500(2) attracted the statutory consequence of penalty and did not render the meeting or the liquidation proceedings invalid in these proceedings. The court also declined to go behind the liquidation on collateral challenge.
Conclusion: The procedural objections failed and the issue was decided in favour of the petitioner.
Final Conclusion: The preliminary objections to jurisdiction, maintainability, limitation, and procedural validity were rejected, leaving the petitions to proceed on the remaining issues.
Ratio Decidendi: A statutory recognition order that is final and unchallenged cannot be collaterally impeached, and in voluntary winding up the liquidator may exercise the statutory powers to settle contributories and make calls without prior court sanction where the Act so provides.
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