TMI Blog1985 (5) TMI 206X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the official liquidator be directed to pay to the bank sale proceeds of Rs. 85,500 in respect of a diesel generating set towards part satisfaction of the decree and to hand over the other hypothecated machines belonging to the company that may be held by the official liquidator to the bank on the allegation that all the machines installed in the factory of the company, including the generating set aforesaid, were hypothecated by the company in favour of the bank as security for the money advanced by the bank to the company, which formed the subject-matter of the suit and the decree. It is claimed that the aforesaid generating set was disposed of by the official liquidator without notice to the bank. The claim of the bank is resisted b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decree. It was further claimed that the official liquidator having sold the hypothecated assets of the company, was bound to reimburse the sale proceeds to the bank, which was a secured creditor, and that in the course of the proceedings of the suit, a receiver was appointed to make an inventory of the various machines and the receiver had submitted his report to the court seized of the suit. The right of the official liquidator to dispose of the hypothecated assets of the company was also challenged. On the pleadings of the parties, the following issue was framed: "Is the petitioner entitled to payment of Rs. 85,500 ?" In support of their respective cases, parties were allowed to produce evidence by affidavits. On behalf of the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t mentions that the factory was closed and there were locks on the shutter and "was under seal" but there is no mention that the property was in the possession of the official liquidator. The bank apparently came to know of the winding-up order in 1982 because by its application, C. A. No. 3 of 1982, it sought from this court leave under section 446 of the Companies Act to continue the suit, which was allowed on February 11, 1982. Unlike a mortgage, a pledge or hypothecation does not have the effect of transferring any "interest" in the property in favour of the pledgee or the hypothecatee. The pledge and hypothecation, however, create a special property in the goods in favour of the pledgee or the hypothecatee. In the case of a pledge, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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