Power to remove liquidator and appoint official liquidator, direct surrender of company records and restrain further prosecutions.

Court applied the power to remove a liquidator and appoint an official liquidator where necessary for effective winding up, and directed immediate delivery of all company books, papers and information to the official liquidator; it fixed the official liquidator's remuneration to be advanced by former directors and reimbursed from company assets when realised. The court granted an injunction restraining the Registrar from instituting further criminal proceedings against the former liquidator while vacating an earlier ad interim injunction that had different terms.

---

---

Issues: (i) Whether the petitioner should be removed as liquidator and the official liquidator appointed in his place; (ii) Whether the Registrar of Companies should be injuncted from instituting further criminal proceedings against the petitioner and whether the interim injunction should be continued or vacated; (iii) Whether directions should be given for delivery of books, papers and documents to the official liquidator and for fixation of the liquidator's remuneration.

Issue (i): Whether the petitioner should be removed as liquidator and the official liquidator appointed.

Analysis: The Court examined the facts including the voluntary winding up resolution, non-compliance by the company with filing and publication requirements, the petitioner's limited receipt of documents and only partial payment, correspondence from the Registrar indicating the company was not treated as in liquidation, affidavits filed by parties and the petitioner's personal disabilities and family calamities. The Court considered the powers under Section 515 of the Companies Act, 1956 to appoint an official liquidator and the failure of the ex-directors to hand over books and papers.

Conclusion: The petitioner is removed as liquidator and the official liquidator is appointed as liquidator of the company.

Issue (ii): Whether the Registrar of Companies should be injuncted from instituting further criminal proceedings and the status of the ad interim injunction.

Analysis: The Court considered the pendency of criminal proceedings instituted by the Registrar under Section 551(5) and the petitioner's request for stay. The Court noted its lack of jurisdiction under Section 633(1) to relieve the petitioner of consequences of default in relation to criminal cases, but nonetheless addressed the petition's prayer for injunctive relief directed at future institution of proceedings by the Registrar.

Conclusion: An injunction is granted against the Registrar of Companies in terms of the petition's prayer (e); the earlier ad interim injunction granted in terms of prayer (d) is vacated.

Issue (iii): Whether the respondents should be directed to deliver books, papers and documents to the official liquidator and whether the remuneration of the official liquidator should be fixed.

Analysis: Having appointed the official liquidator under Section 515, the Court considered the necessity of vesting the liquidator with possession of company records to enable winding up and the statutory provision for fixation and crediting of remuneration under Section 515(4) of the Companies Act, 1956. The Court also weighed the respondents' failure to hand over records and the practicalities of meeting remuneration pending realisation of assets.

Conclusion: The petitioner and respondents Nos. 3 and 4 are directed to deliver all books, papers and documents and information relating to the company to the official liquidator forthwith; the official liquidator's remuneration is fixed at Rs. 1,500 to be paid initially by respondents Nos. 3 and 4 and reimbursed from company assets when realised.

Final Conclusion: The Court exercised its powers under Section 515 of the Companies Act, 1956 to remove the petitioner as liquidator, appoint the official liquidator, direct surrender of company records to the official liquidator, fix the liquidator's remuneration payable initially by the ex-directors and grant an injunction restraining the Registrar of Companies from instituting further criminal proceedings as prayed; the ad interim injunction earlier granted is vacated.

Ratio Decidendi: The Court may, under Section 515 of the Companies Act, 1956, remove a liquidator and appoint the official liquidator where necessary for effective winding up, direct delivery of company books and papers to the liquidator, and fix the liquidator's remuneration under Section 515(4) of the Companies Act, 1956.

---