O L OF RUBY BEARINGS PVT LTD v. CHHAGANBHAI KHODABHAI DHAMI & Ors.

Respondents/Accused do pay the costs, charges and expenses incurred by the Liquidator by way of fees of Chartered Accountant and the fees of the Legal Adviser, as may be deemed fit by the Hon'ble Court. COMA/426/2000 JUDGMENT F. For such further and other reliefs and directions as the Hon'ble Court, in the facts and circumstances of the case may deem fit.” and for initiating appropriate proceedings under Section 543 of the Companies Act, 1956 [hereinafter referred to as 'the Act'].

Company Application No. 2 of 1996 has been filed by the applicant, Official Liquidator by taking Judge's Summons under Section 543(1) of the Act with the following prayers; a) For a declaration that the opponents/accused Directors of the above Company had misapplied, retained and became liable and accountable for the money or property of the Company; b) For declaration that the opponent -Directors of the above company were guilty of misfeasance, breach of trust, breach of duty, gross negligence in discharging their duties and managing of affairs of the company; be made and accounts taken for ascertaining what sums the respondents are liable to contribute to assets of the c) For an order that all necessary enquiries COMA/426/2000 JUDGMENT said Company by way of compensation for such misfeasance and breach of trust as aforesaid; d) For an order that the respondents do justify and severally contribute to the assets of the said company and do pay to the Official Liquidator of the said applicant Company all such sums they may be found liable to contribute to such assets with interest on such sums at the rate of 18% per annum or as may be fixed by this Hon'ble Court as from several dates when the said sums respectively wrongfully paid away until the date of payment;”

Shri RM Desai, learned advocate appearing for the Official Liquidator has submitted that pursuant to the order passed by the learned Single Judge in Company Application No. 2 of 1996, Chartered Accountant was appointed and on the bais of the report submitted by the Chartered Accountant fresh Judge's Summons has been taken out by way of Company Application No. 426 of 2000 for taking appropriate steps against the ex- Directors of the company [in liqn.] for the misfeasance committed by them.

Shri Amar Bhatt, learned advocate has appeared on behalf of respondents No. 1, 2 and 5 COMA/426/2000 JUDGMENT and Shri Harmish Shah, learned advocate appears on behalf of respondents No. 7, 8 and 9. Affidavit-in-Reply is filed on behalf of respondents No. 1, 2 and 5. A preliminary objection has been raised with regard to maintainability of the present application under Section 543 of the Act submitting that the present application for initiating appropriate proceedings under Section 543 of the Act is barred by limitation. It has been submitted that the order of winding up of the company [in liqn.] Ruby Bearings Pvt. Ltd., was passed on

8.2.1988, and the Official Liquidator was appointed, and the present Company Application under Section 543(1) of the Act has been filed in 2000, i.e., after a period of 12 years. Shri Harmish Shah, learned advocate appearing on behalf of the respondents No. 7, 8 and 9 has also adopted the submissions made by Shri Amar Bhatt with regard to bar of limitation.

It is not in dispute that Ruby Bearings Pvt. Ltd., the company [in liqn.] was ordered to be wound up by order dated 8.2.1988 and the COMA/426/2000 JUDGMENT company application under Section 543 of the Act has been filed only on 16th November 2000 i.e., after a period of almost more than 12 years. Section 543 of the Act reads as under; “Power of Tribunal to assess damages against delinquent directors etc. 543(1) If in the course of winding up of a company, it appears that any person who has taken part in the promotion or formation of the company, or any past or present director, manager, liquidator or officer of the company___ (a) has misapplied, or retained, or become liable or accountable for, any money or property of the company; or (b) has been guilty of any misfeasance or breach of trust in relation to the company, the Tribunal may, on the application of the Official Liquidator, or the liquidator or of any creditor or contributory, made within the time specified in that behalf in sub-section (2), examine into the conduct of the person, director, manager, liquidator or officer aforesaid, and compel him to repay or restore the money or property or any part thereof respectively, with interest as such rate as the Tribunal thinks just, or to COMA/426/2000 JUDGMENT contribute such sum to the assets of the company by way of compensation in respect of the misapplication, retainer, misfeasance or breach of trust, as the Tribunal thinks just.