2004 (10) TMI 618 - HC - Companies Law

Summary

Issues:
1. Direction to remit sale proceeds to the applicant.
2. Permission for the Official Liquidator to issue advertisements for inviting claims.
3. Payment to the applicant from the total funds available.
4. Inquiry about the status of the suit against the Company in liquidation.

Analysis:
1. The State Bank of India filed a Judge's Summons seeking a direction for the Official Liquidator to remit sale proceeds of Rs. 18.25 lacs, along with any accrued interest, to be used towards the outstanding dues of the Company in liquidation. The bank claimed to be the only Secured Creditor and requested the entire sale proceeds to be remitted to them.

2. The Official Liquidator submitted a report requesting permission to issue advertisements in newspapers to invite claims from workers or workers' unions. The court granted permission for the advertisements to be published in "Indian Express" in English and "Jansatta-Loksatta" in Gujarati in the Ahmedabad editions. Additionally, the Official Liquidator sought an undertaking from the State Bank of India for refunding the amount with interest if required by the court.

3. The applicant, represented by Mr. Desai, agreed to the prayers made by the Official Liquidator. The court directed the Official Liquidator to issue the advertisements as requested. Out of the total funds available, the applicant was to be paid Rs. 17 lacs, which were held as a term deposit receipt with the bank. The Official Liquidator was instructed to make this payment on the maturity date of the term deposit receipt.

4. The Official Liquidator mentioned in the report about a stay order issued by the court in a previous application regarding the sale of land and buildings of the Company in liquidation. The court directed both the applicant Bank and the Official Liquidator to inquire about the latest status of the suit related to the stay order. Further directions regarding continuing or lifting the stay were to be decided based on the information gathered.

This application was disposed of to the extent mentioned in the judgment, addressing the issues of remittance of sale proceeds, permission for advertisements, payment to the applicant, and the status of the suit against the Company in liquidation.