1956 (2) TMI 29

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....dent. JUDGMENT Krishnaswami Nayudu, J. - The question for determination in this appeal is as to whether the assignment on which the plaintiff has instituted the suit is void under section 227 (2) of the Indian Companies Act. The plaintiff, the first defendant and some others are subscribers in a chit conducted by the Commercial Funds Ltd., Kancheepuram. The first defendant was the success....

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....he Official Receiver, Chingleput, appointed as the official liquidator. It is contended that the assignment is void and not enforceable. On the plain language of section 227 (2) of the Act, there can be no difficulty in upholding the view taken by the lower courts that the transaction is void, the winding up proceeedings having commenced prior to the date of the assignment. But it is contended ....

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.... The learned Judges further observed: "Consequently, the court has very properly laid down that speaking generally any bonafide transaction carried out and completed in the ordinary course of current business will be sanctioned by the court under section 227 (2)." Here it cannot be pretended that paying a creditor by assigning an asset of the company, especially after the commencement of th....