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2015 (6) TMI 813 - HC - Companies LawVoluntarily winding up - Application by official liquidator u/s 543(1) of the Companies Act, 1956 - Prayer for examination in the conduct of ex-directors of the company - Direction to handover the movable & immovable properties along with books of account - Held that:- Reference in this connection may be made to the judgment of the Supreme Court in Official Liquidator v. Raghawa Desikachar [1974 (8) TMI 73 - SUPREME COURT OF INDIA]. The Supreme Court in this case held that the application filed for the purpose should contain the detailed narration of the specific acts of commission and omission on the part of each director quantifying the loss to the company arising therefrom. The burden of proving misfeasance or non-misfeasance rests on the official liquidator. In P.K. Nedungadi v. Malayalee Bank Ltd. (in liquidation) [1971 (2) TMI 74 - SUPREME COURT OF INDIA][AIR 1971 SC 829 also it was held by the Supreme Court that if the money or the property of the company has been misapplied or there has been misfeasance or breach of trust in relation to the company by a director, the court after examining the matter, can compel an officer or other persons mentioned in section 543 to repay or restore the property with interest at such rate as the court may think fit or to contribute such sums to the assets of the company by way of compensation in respect of the misapplication, retainer, misfeasance or breach of trust, as it thinks fit. The allegation of misfeasance and misapplication has to be specifically pleaded with material particulars against each of the directors/erstwhile directors of the company. It is necessary that specific acts of commission or omission and/or negligence on the part of each director are pointed out and it is shown that the loss suffered by the company was result of such omission, commission or negligence. It is only then that the loss can possibly be quantified as the order of recovery of such loss shall have to be directed against such or any of the directors. In the circumstances, therefore, the petitioner cannot be said to have proved the ingredients of section 543 of the Companies Act, necessary for holding the respondents-erstwhile directors of the company guilty of misfeasance, misapplication, breach of trust or retention of the money of the company. - Application dismissed.
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