AI Drafter 
TaxTMI 
TaxTMI 
2009 (7) TMI 784
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....dator under section 449 of the Companies Act. The liquidator filed C.A. No. 32 of 2006 under section 477 of the Companies Act to summon the respondent, who is the ex-managing director, and examine him with regard to details of the quarry lands owned by the company in liquidation. The ex-managing director appeared before the court and furnished details of land owned by the company situated in different villages of Khammam and Warangal districts. All these lands were taken possession by the official liquidator with the assistance of the State Bank of India, who advanced loans to the company in liquidation. While taking possession, the officials observed illegal blasting and quarrying activities. The same was reported to the court. Thereupon this court directed to contact qualified technical person to evaluate and assess the loss sustained by the company due to illegal mining. Subsequently, by order dated 27-12-2006, this court directed the Assistant Director, Mines and Geology (ADMG), Khammam, to inspect the company lands in two districts and ascertain the value of illegally mined minerals. The Assistant Director, Mines and Geology submitted a report vide letter dated 16-3-2007, esti....
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....osed in the pleadings. A reference to these submissions is made at the appropriate place. 5. The basis for the present application under section 468 of the Companies Act is the report of the Assistant Director, Mines and Geology submitted to the official liquidator vide letter dated 16-3-2007. Some reliance is also placed on the statement of affairs by the respondent. The thrust of the argument of learned counsel for the official liquidator is that though in the prospectus of the company (issued in connection with public issue of equity shares) it is shown that an extent of acres 66.50 cents has been acquired by the company for mining and though the mining lease was obtained for quarrying granite, the respondent failed to remit the amounts realised from sale of granite to accounts of the company. It is also the contention that some lands belonging to the company were leased out to third parties and the lease amounts were not accounted for. The contention is opposed by learned counsel for the respondent. According to him, unless and until it is shown that any money or property is in the custody of the respondent, an application under section 468 of the Companies Act would not lie....
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....he two directors of the company and not to the company itself. It was contended for the Custodian that the Bombay Evacuee (Administration of Property) Act, 1949, bars the jurisdiction of the court to interfere with anything done under the said Act and that in case of dispute as to ownership of the property, the Indian Companies Act has no power to adjudicate upon the dispute. The Division Bench of the East Punjab High Court came to the conclusion that under section 185 of the Indian Companies Act (which is now section 468), the company court has no jurisdiction to enforce the order against those persons other than those mentioned in section 185 of the Indian Companies Act and that the transactions entered into by the company with third parties are beyond the pale of jurisdiction of the company judge. The relevant observations are as follows :- "In John Brothers v. Official Liquidator, Agra Spinning and Weaving Mills Co. Ltd. [1936] 6 Comp. Cas. 219 (All.), it has been held that a company judge has jurisdiction for the purpose of carrying out the liquidation, that is the realisation of the assets of the company, and payment to the creditors, but he has no jurisdiction to enforce ....
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....he transfer/alienation by the respondent subsequent to commencement of liquidation proceedings. This court issued summons on 9-2-2005. In obedience thereto, the respondent appeared before this court and he was examined by the court on 30-10-2007. During the course of examination, information was elicited from him regarding the public issue of 28,800 equity shares, the land owned by the company, the amount borrowed by the company from IFCI, IRBI and the SEBI, and the details furnished in the statement of affairs. To a specific question whether the respondent informed IFCI about the company having acres 66.59, the respondent replied that the company has acres 66.59 and by that date lands in Mallemadugu village and Pasumanda in Chittoor were not registered in the name of the company. He also admitted that the company owned acres 34.00 of land in Khammam and Warangal districts. Nowhere in the examination of the respondent in Company Application No. 32 of 2005 it was suggested that he transferred/alienated the land to third parties for the purpose of mining or that he realised certain amounts by lease of the quarry lands. Therefore, it is rather doubtful whether the liquidator can maint....
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....f Mines and Geology. The rest of the lands in survey Nos. 16/A and 16/C of Gudurupadu, survey No. 404 of Kachirajugudem Village and survey No. 35/A of Arekodu village, there was illegal mining of black granite mineral. On enquiries the Assistant Director, Mines and Geology found that quarrying was done seven years prior to date of inspection. From these the Assistant Director, Mines and Geology ascertained the value of the mineral which was extracted legally as Rs. 98,93,287 and the value of the mineral illegally mined as Rs. 32,17,060. Various details were furnished in a separate detailed report. 15. As per the detailed report of the Assistant Director, Mines and Geology, the lands in survey Nos. 18/A, 18/B, 18/C, 16 and 13 of Gudurupadu, Khammam Rural Mandal, admeasuring acres 17.95, the land in survey No. 35/A of Arekodu admeasuring acre 1.425, the land in survey No. 404 of Kachirajugudem village admeasuring acres 9.20 and land in survey No. 389/B of Beerolu Village admeasuring acre 1.20 belonged to the company in liquidation. As noticed by the inspecting team, insofar as Gudurupadu lands there was illegal mining in survey Nos. 16/A and 16/ C, and in survey No. 35/A of Arekod....