Home Case Index All Cases Companies Law Companies Law + HC Companies Law - 2018 (5) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (5) TMI 1859 - RAJASTHAN HIGH COURTSpecific acts of commission or omission on the part of director - ex-directors of the company in liquidation are guilty of having committed breach of trust in discharge of functions and duties in managing the affairs of the company in liquidation - misfeasance or breach of trust within the meaning of section 543 of the Act of 1956 - acts for alleged transfer of property in preference to the other creditors reflects fraudulent nature of acts and prove their act of mismanagement - HELD THAT:- Sale deeds, which were sought to have been executed on the basis of duress and force have already been annulled by this court. Sufficient mitigating grounds, as noted above, are made out. Merely on the basis of report of N. C. Jain, chartered accountant, who has admittedly not examined the books of account, which makes it obvious that the case for initiating proceedings and punishing the respondents under section 543 of the Act of 1956 is not made out. It is also stated that the official liquidator had already sold the said properties. Taking into consideration that the company application fails to detail narration of the specific acts of commission or omission on the part of each director and further the official liquidator has not been able to prove the case of misfeasance or committing any breach of trust in discharge of functions and duties and the respondents have been able to justify their action in not making available the records and selling their properties in duress, issues as framed by this court are not found to be proved and are answered in favour of the respondent. It is noted that non-handing over the possession of current stock, books of account is on the basis of reasonable excuse and this court is satisfied that keeping in view the law laid down by the apex court in the case of Official Liquidator v. Raghawa Desikachar [1974 (8) TMI 120 - SUPREME COURT OF INDIA], no case for holding the respondents guilty of section 543 of the Act of 1956 of misfeasance or breach of trust within the meaning of section 543 of the Act of 1956 is made out.
|