https://www.taxtmi.com/caselaws?id=371327 Once winding up is deemed to have commenced, a creditor cannot obtain or retain a preferential recovery through a consent decree that disturbs pari passu distribution in liquidation. Applying Section 441 of the Companies Act, 1956 with Section 20 of the Sick Industrial Companies (Special Provisions) Act, 1985, the Bombay HC treated winding up as commencing on the BIFR recommendation date, so the consent terms and decree were entered after commencement. On that basis, the Court held the recovery to be a fraudulent preference, refused leave under Section 446 to enforce the decree, and upheld the direction to refund the amount with interest, while leaving the creditor to prove its claim before the Liquidator. en-us Mon, 24 Sep 2018 00:00:00 +0530 Mon, 03 Dec 2018 09:01:57 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=371327 Once winding up is deemed to have commenced, a creditor cannot obtain or retain a preferential recovery through a consent decree that disturbs pari passu distribution in liquidation. Applying Section 441 of the Companies Act, 1956 with Section 20 of the Sick Industrial Companies (Special Provisions) Act, 1985, the Bombay HC treated winding up as commencing on the BIFR recommendation date, so the consent terms and decree were entered after commencement. On that basis, the Court held the recovery to be a fraudulent preference, refused leave under Section 446 to enforce the decree, and upheld the direction to refund the amount with interest, while leaving the creditor to prove its claim before the Liquidator. Case-Laws Companies Law Mon, 24 Sep 2018 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=371327