TaxTMI 
TaxTMI 
2007 (11) TMI 421
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.... appellant applied before the Company Law Board under section 141 of the Companies Act, 1956 and is here assailing the order of dismissal^1 thereof. The Company Law Board exercises the Central Government's powers under section 141 of the Act. The two questions of law that have been raised in this appeal limited to legal issues are, as to whether belated registration of a charge can be permitted in respect of any asset of a company which has been directed to be wound up, and, whether a charge comes to be created only upon the formal execution of a document and not on the company's undertaking to the creditor to create a charge. For the reasons that would appear hereinafter, the second question need not be answered if the first question is an....
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....any went into liquidation on 26-6-1991. The company's assets were sold for a sum of Rs. 3,61,50,000. The appellant first filed a suit for recovery of its dues against the company in liquidation with leave under section 446 of the Companies Act and then had such proceedings trans-ferred to the appropriate Debts Recovery Tribunal following the enact-ment of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. The appellant obtained a certificate in such proceedings. The appellant applied before the Official Liquidator for payment. The Official Liquidator acknowledged the charge in respect of the movable properties and settled the claim and offered to make payment pro rata on such count but held the appellant to be an unsec....
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....or enlargement of time for its charge in respect thereof to be registered. 7. The principal issue that arises is whether upon a company going into liquidation, a creditor whose charge has not been registered can apply for registration afresh. Such matter was not directly alluded to by the Company Law Board and in the order impugned, two issues were framed as follows : "(a )Whether the transactions covered by the loan agreements dated 28-3-1981 and 10-7-1986, attract the provisions of section 125 of the Act? (b )If so, whether sufficient cause or justification is shown by the petitioner to condone the delay in filing the particulars of charges under section 141 of the Act?" 8. The Company Law Board answered the first issue agains....
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....nging from the distinction between a mortgage and a charge to circumstances in which the discretion under section 141 may be exercised and the extent of conditions that may be imposed, have been cited but none, till the very end, on the only question of importance that arises. Counsel for the appellant has fairly referred to the decision reported in Resinoid & Mica Products Ltd., In re [1982] 3 All ER 677 (CA), which throws some light on the matter though it does not go so far as to hold as an absolute proposition that an application for registration of a charge cannot altogether be entertained at the liquidation stage. 12. Immediately upon an order of winding up being made the rights of creditors crystallise. In terms of section 529A of....
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....o had entered into transactions with the company during the interregnum, to disregard such registration. The English decisions cited in this appeal other than the Resinoid & Mica Products Ltd.'s case (supra), show that there is a discretion at large that may be exercised upon an application for enlargement of time for registration being made, subject to the time-tested conditions that are generally imposed in such matters. The decisions reported at Braemar Investments Ltd., In re [1988] BCLC 556, Kris Cruisers Ltd., In re [1948] 2 All ER 1105 (Ch.D) and Mechanisations (Eaglescliffe) Ltd., In re [1965] 35 Comp. Cas. 478 (Ch.D) enunciate the law and cover instances even when the company faces imminent liquidation, but none of the cases relate....