TMI Blog1984 (11) TMI 259X X X X Extracts X X X X X X X X Extracts X X X X ..... mma, mother of one of the directors of the said company. The other five rooms were in possession and/or in use and occupation of the company itself. On July 7, 1978, a winding up petition was filed. It appears that pending the hearing of this petition, the said Devki Amma surrendered the tenancy in respect of the five rooms to the company and the company thereafter rented out the entire second floor (i.e., the five rooms which were formerly in possession of the said Devki Amma and the other five rooms which were in possession of the company), to respondent No. 1 on the terms and conditions incorporated in an agreement dated July 18, 1978. Thereafter an order dated January 19, 1979, was passed for winding up the company. It is the official liquidator's claim that since the transaction between the company and respondent No. 1 was entered into after the filing of the winding-up petition, the transaction is void and respondent No. 1 had, therefore, acquired no right, title and interest in the said premises and is bound to hand over possession of the premises in question to the official liquidator. It is the case of respondent No. 1 ( a ) that the official liquidator's application is ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble claims) of the company, and any transfer of shares in the company or alteration in the status of its members, made after the commencement of the winding up, shall, unless the court otherwise orders, be void." Hence, by the statute itself, the transaction is deemed to be void. There is no question of the official liquidator asking for any declaration. Article 59 of the Limitation Act would, therefore, be of no application. The contention canvassed must fail. In any event, assuming that the official liquidator seeks such a declaration, the limitation would be twelve years. In this view of the matter also, the said contention must now fail. Mr. Kenia next contended that it was as far back as March, 1979, that respondent No. 1 had furnished to the official liquidator a copy of the agreement dated July 18, 1978, entered into between respondent No. 1 and the company, through its directors. That the official liquidator thereafter took no steps. On the other hand, he accepted rent from respondent No. 1 in respect of the premises. Not only that, he even allowed respondent No. 1 to incur expenses for repairs of the premises. At a later stage, when there was a leakage in the premises, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Kenia's argument, viz ., that it would not be just and equitable to grant relief to the official liquidator, it may be stated that the question to be posed is not whether respondent No. 1 would stand to lose moneys expended by him on the premises in question and/or what is the loss that would be caused to him, but the question that needs to be asked more particularly in view of the ratio in the case of Tulsidas Jasraj Parekh v. Industrial Bank of Western India, AIR 1931 Bom. 2, is whether the transaction in question is in furtherance of the company's business and/or in the interest of the company in liquidation and/ or its creditors. I have repeatedly asked this latter question to Mr. Kenia, but, at the hearing, he made no submission on this aspect. On the other hand, there is nothing to show that the transaction is in the interest of the 'company's business or in the interest of the liquidator. In view of this, this contention of Mr. Kenia is negatived. The next contention of Mr. Kenia is that the transaction entered into by respondent No. 1 with the company is a bona fide transaction. Mr. Kenia urged that respondent No. 1 is a doctor by profession and was practising a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een respondent No. 1 and the company. That there was and is no reason why the official liquidator should now be granted any relief whatsoever and relief must be denied. The argument is but a paraphrasing of the previous contention, but I shall deal with it. The question is not whether respondent No. 1 acted bona fide or he was a victim of a deception or a fraud practised on him by the company. The question is whether the transaction in question is in the interest of the business of the company or in the interest of the company (now in liquidation) or its creditors. If the answer to this is in the negative, then the question of sustaining the transaction cannot arise. Now, since the answer to this question is in the nagative, the argument must fail. Moreover, on the showing of respondent No. 1 himself, he has been aware of the winding-up proceedings and of the official liquidator being appointed liquidator of the company and despite this, even till today he has not preferred any application seeking any directions for having the transaction validated or otherwise recognised. No explanation is offered as to why respondent No. 1 has taken no steps in this direction till today. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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