https://www.taxtmi.com/caselaws?id=98271 Book adjustments, transfers and other account entries made shortly before winding up may constitute fraudulent preference under the Companies Act, 1956 where the company was commercially insolvent and the surrounding circumstances show a dominant intention to prefer one creditor over others. The Court treated an earlier final determination under section 542 as res judicata, so the same issue could not be reopened between the same parties. It also held that repayment directions against creditors alone were not sustainable where the alleged preference consisted of adjustments affecting absent parties' accounts, leaving the liquidator to pursue appropriate proceedings instead. en-us Mon, 06 Dec 1965 00:00:00 +0530 Thu, 19 Jan 2012 18:21:36 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=98271 Book adjustments, transfers and other account entries made shortly before winding up may constitute fraudulent preference under the Companies Act, 1956 where the company was commercially insolvent and the surrounding circumstances show a dominant intention to prefer one creditor over others. The Court treated an earlier final determination under section 542 as res judicata, so the same issue could not be reopened between the same parties. It also held that repayment directions against creditors alone were not sustainable where the alleged preference consisted of adjustments affecting absent parties' accounts, leaving the liquidator to pursue appropriate proceedings instead. Case-Laws Companies Law Mon, 06 Dec 1965 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=98271