TaxTMI 
TaxTMI 
2010 (4) TMI 604
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....ies (Court) Rules, 1959, seeking to quash the execution proceedings in E. A. No. 106 of 2007 in C. D. No. 814 of 2003 and to raise the attachment order dated August 30, 2007 and whereas, C. A. No. 1670 of 2007 is filed under rule 9 of the Companies (Court) Rules, 1959, seeking stay of all further proceedings in E. A. No. 106 of 2007 in C. D. No. 814 of 2003. 2. By an order dated August 19, 1998, passed in Company Petition No. 84 of 1997, this court directed winding up of M/s. Asia Pacific Investment Trust Ltd. and the official liquidator attached to this court came to be appointed as the liquidator of the company (in liquidation). The company (in liquidation) was carrying on business as non-banking financial institution. The company (in liquidation) failed to keep up its commitments and defaulted in making payments to its depositors. During the course of liquidation proceedings, the official liquidator sold some immovable properties of the company (in liquidation) situated at Delhi, Bangalore, Chennai and Coimbatore, with leave of this court. While so, the official liquidator received a letter dated September 13, 2007, from the State Bank of India the fifth respondent herein enc....
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....mer Protection Act, against the property of the judgment debtors and not against the company alone and therefore, section 446 or section 536 of the Companies Act cannot be pressed into service. It is further stated in the counter-affidavit that proceedings under section 25/27 of the Consumer Protection Act cannot be brought into the ambit of section 446 or 537 of the Companies Act. For better appreciation, I may refer paragraphs 3 and 4 of the counter-affidavit, which reads as hereunder : "3. It is pertinent to note that C. D. No. 814 of 2003 is filed not only against Asia Pacific Investment Trust Ltd. (company in liquidation) but also against all the directors of the company and their other companies too are made liable in C. D. No. 814 of 2003. Thus, C. D. No. 814 of 2003 is filed against the company in liquidation as well as other companies which are not in liquidation. Accordingly, the District Consumer Forum-II, after recording detailed findings allowed the complaint directing the opposite parties therein, the directors and their other companies to jointly and severally pay the decretal amount of Rs. 8,70,905 with interest at 12 per cent, per annum from the date of maturity....
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....as void since respondents Nos. 1 to 4 moved the applications seeking ex post facto ratification of their action for initiating proceedings against the company (in liquidation). In support of his submissions; reliance has been placed on the following decisions : (1)Manipal Sowbhagya Nidhi Ltd. v. A.G.M.F.G.O.C.C.A [2006] 2 CPJ 318 (NC) ; (2)Vinod L. Doshi v. Sohan Lal [2007] 1 CPR 282 ; (3)CIMMCO Birla Ltd. v. Anil Sethi [2009] 1 CPJ 68. 8. In Manipal Sowbhagya Nidhi Ltd. v. A.G.M.F.G.O.C.C.A [2006] 2 CPJ 318 (NC), the National Consumer Disputes Redressal Commission, New Delhi, held that the remedy under section 3 of the Consumer Protection Act, 1986, is an additional remedy available to the consumers. Mere pendency of the petition before the Company Law Board or the High Court does not result in a ban on the functioning of the consumer fora. 9. In Vinod L. Doshi v. Sohan Lal [2007] 1 CPR 282, it has been held by the Punjab State Consumer Disputes Redressal Commission, Chandigarh, that section 446 of the Companies Act, creates a bar to the continuance of pending proceedings subject to permission from the company judge or any legal authority mentioned in the Companies ....
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....on Act and receive their dues the other creditors who do not move that authority may not get any amount due to them. It cannot be taken that the Legislature intended that such a result should happen by implementing the Consumer Protection Act intended to benefit the consumers in general and not to benefit one or a small group of consumers against the interests of the larger sections of the consumers. 12. Section 10 of the Companies Act, 1956, provides that the court haying jurisdiction under the said Act shall be the High Court having jurisdiction in relation to the place at which the registered office of the company concerned is situate, except when jurisdiction is conferred on any District Court subordinate to the High Court. Section 439 of the Companies Act provides for filing of a petition for winding up of a company. Section 443 provides for the passing of an order of winding up among other matters. Section 446 of the Companies Act is as follows : "446. (1) When a winding up order has been made or the official liquidator has been appointed as provisional liquidator, no suit or other legal proceeding shall be commenced, or if pending at the date of the winding up order, s....
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.... the Companies Act. Under section 530, the company is entitled to make certain payments as preferential payments. Under rules 147 to 169 and 174 of the Companies (Court) Rules, 1959, the liquidator is to initially settle a list of creditors, and the court will adjudicate on any further claims and finally settle the list of creditors. Only after such settlement of list of creditors, the liquidator can proceed to declare any dividend with the sanction of the court (rule 275 of the Companies (Court) Rules, 1959). 14. The historical evolution of section 446 was succinctly traced in Sudarsan Chits (I. ) Ltd. v. G. Sukumaran Pillai [1985] 58 Comp Cas 633 (SC). The Supreme Court held as follows (page 637 of 58 Comp Cas) : "7. To save the company which is ordered to be wound up from this prolix and expensive litigation and to accelerate the disposal of winding up proceedings, Parliament devised a cheap and summary remedy by conferring jurisdiction on the court winding up the company to entertain petitions in respect of claims for and against the company. This was the object behind enacting section 446(2), and therefore, it must receive such construction at the hands of the court as w....