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TMI Blog1932 (1) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... the 27th of August, by an order made by consent of certain persons, Mr. Bavin was given all the powers conferred by section 179, Companies Act, and was given liberty to carry on the business of the company for a limited time and to arrange for finance upon such terms as he should think fit. This order of the 27th August, was not unfortunately brought to the notice of the learned Judge who heard the present application on the Original Side. In June, 1927, the usual steps were taken by Mr. Bavin as the Official Liquidator for having the list of contributories settled by the Court on the 13th of that month. Notices appear to have been issued to the contributories and, in particular, to Mr. Montgomery. For some reason which is not apparent, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g been made at the instance of Mr. Bavin, it does not appear that, so far as Mr. Montgomery was concerned, Mr. Bavin took any steps under that order. Now, when March 1930 came, Mr. Bavin was in trouble and at the present moment he is undergoing a sentence in respect of some offence not connected with the present company. When he was about to be removed, he wrote to his attorneys a letter in which he asked them to inform the gentlemen who would be appointed in his place that from time to time he had received amounts payable for calls on shares during the course of the liquidation. That letter has been produced in evidence and one of the persons mentioned in it as having paid the call was Mr. Montgomery the appellant who is stated quite trul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om them to the company in liquidation would satisfy themselves that the person to whom the payment is made is clothed with the necessary authority to receive the payment and has power to give a proper discharge from that obligation." Now, it appears to me that this is a matter which requires somewhat careful consideration before the principle stated by the learned Judge is applied to the facts of this case. The position is that under the Companies Act and by virtue of section 157, upon the happening of a winding up, a new statutory liability is imposed upon certain persons who are called contributories. Prior to that, no doubt, there was a liability to pay the calls when calls should be made by the management of the company; but where such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y make a call on his own responsibility, and he would be quite in order in such a case to make a call and receive the payment. One cannot expect a business man always to have in mind whether the company has been wound up voluntarily or compulsorily. In India as distinct from England, there is at present no provision by which the liquidator in a compulsory winding up can make a call without coming to Court; but there is no doubt that whether in a voluntary winding up or in a compulsory winding up, the call is really a contribution to the assets of the company for the purpose of the winding up, which contribution is enforceable by the Official Liquidator for the purpose of putting funds into his control for the administration of the company's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand of the Official Liquidator should have known better and because he did not take the precaution to see that the Court had made an order enforcing the call and did not notice that under the usual practice of the Court payment would be ordered to be made into the Imperial Bank, it is reasonable and right that he should be ordered to pay the money twice. It seems to me that as regards the order of 25th November, 1929, it was an order obtained by Mr. Bavin who had no intention whatever of obtaining the money twice. Mr. Montgomery had no reason to think that because a formal order constituting his liability was being made, Mr. Bavin would attempt to obtain the money twice. It was Mr. Bavin's duty as an officer of the Court, when he applied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... directing that Mr. Bavin should be required to give an account, in particular, as to what he had done with the money. But that only resulted in a letter written from prison by Mr. Bavin saying that he had filed all his papers and had accounted for all his receipts and what he had done with the money. In view of Mr. Bavin's action in collecting the money prior to his having any right to collect it and putting it in the way that he put it into another Bank instead of putting it into the Imperial Bank, it seems very doubtful whether the company's creditors have really got any benefit of the money which Mr. Bavin had so collected. There is however no material before the Court which would enable us to say that the Official Liquidator has proved ..... X X X X Extracts X X X X X X X X Extracts X X X X
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