TMI Blog2006 (4) TMI 254X X X X Extracts X X X X X X X X Extracts X X X X ..... e High Court which are under challenge in this appeal are set aside - CIVIL APPEAL NO. 1392 OF 2003 - - - Dated:- 4-4-2006 - ARUN KUMAR AND R.V. RAVEENDRAN, JJ. Ravindra Shrivastava, N.S. Boparai, Rishi Malhotra and Prem Malhotra for the Appellant. R.K. Rathore, Amit Singh, Sanjeev Anand, Yakesh Anand, Vikas Vashishth, K.S. Rana, M.K. Verma and Arun K. Sinha for the Respondent. JUDGMENT Arun Kumar, J. - Punjab National Fertilizer and Chemical Limited (hereinafter referred to as PNFC ) is a Company Limited by shares and is registered as a company under the Companies Act, 1956. This company was promoted by the Punjab State Industrial Development Corporation Limited (hereinafter referred to as PSIDC ) and the PS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Official Liquidator) and PSIDC to pay six months salaries to the employees. 4. In their application, the workers sought relief mainly on the basis of the said note of the Chief Minister terming it as an order of the Chief Minister. On the said application of the workers, the learned Company Judge passed an order on 16-5-2002 directing PSIDC to release funds in terms of the order of Chief Minister dated 25-8-2001 to the Official Liquidator within a period who was directed to disburse it to the workmen after examining the claim of each workman. 5. The PSIDC applied for review of the said order of the Company Judge on the ground that it was not in a sound financial position to make the payment. Secondly, the PSIDC denied its liability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o fasten liability on a third party, i.e., the PSIDC while seized of proceedings with respect to the Company in liquidation (the PNFC). Was it legally permissible? The learned counsel for the appellant submitted that the PSIDC was formed in the year 1966 as one of the State Financial Institutions for promoting and developing industries in the State of Punjab. In its role of promotion and development of the industries in the State, the PSIDC promoted more than 100 companies. The object was to ensure industrial development in the State. The PNFC was one of the several companies promoted by the PSIDC. As already notified, the PNFC is a separate legal entity being a Company Limited by shares under the Companies Act. The PNFC is not a Govern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the workers have pleaded that the PSIDC exercised control over financial and administrative affairs of the PNFC. It is also submitted that the fact that the PSIDC holds 46.13 per cent shares in the PNFC shows the financial interest of the PSIDC in the PNFC. The officers of the PSIDC are also said to have been posted from time to time in the PNFC to manage its affairs. The learned counsel relied on section 446 of the Companies Act to suggest that a Company Judge has wide powers with respect to a company in liquidation. He invited reference to Sundarsan Chits (I) Ltd. v. O. Sukumaran Pillai [1984] 4 SCC 657 in support of this contention. In our view this judgment does not help the respondent. Under section 446, the powers of the Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause the note of the Chief Minister cannot be said to be a directive of the State Government nor it is in relation to broad policy of the Company. Article 135 does not help the respondent. 13. While contending that the veil has to be lifted, the learned counsel relied on Calcutta Chromotype Ltd. v. Collector of Central Excise AIR 1988 SC 1631. This was a case of alleged evasion of excise duty by a manufacturer selling its manufactured products through a sole selling distributor, who sold the goods in market at a higher price. The idea was to show a lesser price of manufacture in order to save central excise duty. The manufacturing company as well as the business of the sole selling agent though shown as independent, were owned by t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
