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2008 (9) TMI 550 - HC - Companies LawAvoidance of transfer after commencement of winding up - Held that:- The purpose underlying the investment of the power in court is for the benefit and the interest of the company so as to ensure that a company which is made the subject of a winding up petition may nevertheless obtain the money necessary for carrying out its business and so as to avoid its business being paralysed. It is also pointed out that if that was the purpose and object of the section, it would hardly be proper and just to stultify the power and restrict its operation since otherwise it was bound to be counter-productive in the sense that the very purpose of keeping the company as a going concern so as to ensure the interest of the shareholders and creditors would be defeated. Taking into consideration the sequence of events and the facts and circumstances attendant, this court is of the view that the transactions entered into, are bona fide. So long as the court is able to see bona fide transactions, no doubt it would fall within the clause "unless the Tribunal orders otherwise", and hence these transactions cannot be declared as void under section 536(2) of the Companies Act, 1956. Therefore, this court has to necessarily affirm the order of the learned single judge. Appeals dismissed.
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