https://www.taxtmi.com/caselaws?id=97079 Set-off and counterclaims pleaded defensively against a company in liquidation do not constitute proceedings commenced against the company and therefore do not require leave under section 171 of the Indian Companies Act. Where mutual money claims exist, section 229 applies the insolvency principle of mutual adjustment: cross-demands must be set off and only the balance may be recovered. This prevents a company from recovering its claim in full while requiring the opposing party to prove its cross-claim only for dividend in the winding up. The defence may consequently be raised and examined in the existing suit. en-us Wed, 01 Nov 1950 00:00:00 +0530 Fri, 13 Jan 2012 18:43:42 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=97079 Set-off and counterclaims pleaded defensively against a company in liquidation do not constitute proceedings commenced against the company and therefore do not require leave under section 171 of the Indian Companies Act. Where mutual money claims exist, section 229 applies the insolvency principle of mutual adjustment: cross-demands must be set off and only the balance may be recovered. This prevents a company from recovering its claim in full while requiring the opposing party to prove its cross-claim only for dividend in the winding up. The defence may consequently be raised and examined in the existing suit. Case-Laws Companies Law Wed, 01 Nov 1950 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=97079