TaxTMI 
TaxTMI 
2008 (1) TMI 612
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....er sections 454 and 455 of Companies Act to respondents requiring them to file Statement of Affairs (SoA), deliver assets, books of account and records of the company. Later he took possession of the assets and records available at the premises of company situated at Nalgonda as well as Hayathnagar. During the verification of SoA under the head 'Trade debtors', it was noticed that M/s. The Waterbase Limited has to pay an amount of Rs. 3,24,000 to the company. OL therefore filed C.A. No. 614 of 2001 under section 446(2)(b) of Companies Act for recovery of the said amount. During the hearing of the said application it transpired that the records taken over by liquidator do not contain the debtors ledger for 1995-1996. Due to non-availability of same and other records, OL is not in a position to pursue recoveries and therefore respondents may be directed to produce debtors ledger and other records. 3. After service of notice, respondents 1 and 2 entered appearance through a counsel and respondent No. 3 remained ex parte. However first respondent filed counter affidavit on behalf of other respondents also. It is stated that the company established in 1987 for manufacturing Poly Propyl....
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.... 6. Learned Counsel for OL submits that initially first respondent informed that the records are with auditors for preparation of SoA. Subsequently by submitting SoA with letter dated 30-9-1999 first respondent informed that many of the records have been destroyed by militant labour and that when the records were handed over by representative of first respondent the ledger for 1995-1996 was not handed over and therefore first respondent and other respondents are bound to handover the records including debtors ledger. Per contra', learned Counsel for respondents 1 and 2 submits that the application is barred by limitation, that this Court has no jurisdiction to entertain and order the application and that the records have been already destroyed. He placed reliance on the decision of Allahabad High Court in Parasrampuria Trading and Finance Ltd., In re [2007] 76 SCL 223 (All.). 7. The point that would arise for consideration is whether Court cannot give a direction to former Directors of the company in liquidation to produce records and debtors' ledger for 1995-1996 and whether an application filed by liquidator seeking such a direction is barred by limitation. 8. Section 456(2) o....
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.... in his custody or under his control to which the company is prima facie entitled." [Emphasis supplied] 10. An analysis of the above provision would show that contributories of a company and officer or employee of company can be directed to pay, deliver, surrender or transfer forthwith to OL any money. They may be directed to deliver property or books of account to which a company is prima facie entitled to the liquidator. The words 'at any time after making a winding up order' appearing in section 468 of Companies Act would leave no doubt that period of limitation would not apply. The Court is empowered to issue such a direction to contributory, officer or employee of the company to deliver books of account at any time after winding up order. The only condition imposed by the statute is that the company in liquidation must be shown to be prima facie entitled for, inter alia such books of account. If an order is passed by the Court directing former director of the company to deliver books of account and the same is not delivered to the liquidator, such person is liable for an offence with imprisonment for a term which may extend to two years or with fine or with both. Therefore a ....
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.... documents. First one is letter dated 19-8-1999 addressed by first respondent informing OL that the books of account have been submitted to auditors for preparation of SoA and that he would submit same as soon as the process of preparation of SoA is completed. In this letter nowhere first respondent admits that debtors' ledger for 1995-1996 was also handed over to the auditors. Therefore this document is of no help nor it proves allegation of OL that the ledger is being withheld by first respondent. 13. Second document is dated 30-9-1999 which is also addressed by first respondent to liquidator. This is a letter accompanying SoA in Form No. 57 as on 29-4-1999 along with an affidavit of concurrence to SoA by respondents 2 and 3 in Form No. 58. In this document, first respondent inter alia stated as below. "I have already handed over possession of our factories at Chityal, Nalgonda District and Hayath Nagar, Hyderabad to you in August 1998 itself. The preparation of the statement has taken more time than anticipated on account of the following factors : 1.Many of the records had been destroyed by militant labour. 2.I have not been in a position to even enter the factory for the l....