THE HON’BLE Ms. JUSTICE G.ROHINI COMPANY APPLICATION NOs.1526 & 1527 OF 2010 In R.C.C.No.2 OF 2002 Dated: 18.01.2011 In Company Application No.1526 of 2010: In the matter of Companies Act, 1956 And In the matter of M/s. Southern Pesticides Corporation Limited (In liqn.) Between: M/s. Southern Pesticides Corporation Limited (In liqn.) Rep. by the Official Liquidator, High Court of Andhra Pradesh, Hyderabad. … Applicant And 1. Industrial Development Bank of India and 2 others. … Respondents In Company Application No.1527 of 2010: In the matter of Companies Act, 1956 And In the matter of M/s. Southern Pesticides Corporation Limited (In liqn.) Between: M/s. Southern Pesticides Corporation Limited (In liqn.) Rep. by the Official Liquidator, High Court of Andhra Pradesh, Hyderabad. … Applicant And 1. Industrial Development Bank of India and 2 others. … Respondents THE HON’BLE Ms. JUSTICE G.ROHINI COMPANY APPLICATION NOs.1526 & 1527 OF 2010 In R.C.C.No.2 OF 2002 COMMON ORDER : These two applications are filed by the Official Liquidator attached to this Court representing M/s. Southern Pesticides Corporation Limited (In liqn.) with the following prayers: (i) Permit the Official Liquidator to dispense with the adjudication of claims of other creditors mentioned at para 4 (iii) and (iv), whose claims are not likely to yield any dividend. (ii) direct the respondents herein to refund a sum of Rs.11,08,217.10 ps, Rs.5,02,815.89 ps and Rs.6,50,536.71 ps respectively as described in para No.5 of the affidavit. (iii) declare a dividend of Rs.3,50,093.17 ps, as admitted secured debt @ 1.4199% to Bank of Baroda in respect of realization on current assets and a dividend of Rs.69,25,310.59 ps as admitted secured debt @ 25.4364% to workmen in respect of realization of all the assets as detailed in the statement marked as Annexure-B. (iv) authorize Official Liquidator to open a separate dividend account in Punjab National Bank and pay the dividend to secured creditors/workmen out of the said account, in terms of Rule 290 of the Companies (Court) Rules, 1959. (v) dispense with the publication of notice of dividend in newspapers. (vi) authorize Official Liquidator to send individual notices of dividend in Form No.138 along with 139. (vii) authorize Official Liquidator to fix the schedule for making payment. (viii) authorize Official Liquidator to transfer the unpaid dividend, if any, remaining in the dividend account, after the expiry of the 6 (six) months period to Companies Liquidation Account, in terms of Section 555 of the Companies Act, 1956. (ix) authorize Official Liquidator to pay dividend due to any deceased creditor to his legal heirs upon production by such legal heirs, family member certificate or such other certificate instead of producing a succession certificate and also upon furnishing personal indemnity, in terms of Rule 280 of the Companies (Court) Rules, 1959. (x) authorize Official Liquidator to take all necessary actions and steps which are incidental to declaration and payment of dividend and to effectively implement the orders of this Hon’ble Court in that regard. (xi) order that the costs of this application do come out of the Estate of the company.” In the affidavit filed in support of the application, it is stated that M/s. Southern Pesticides Corporation Limited was directed to be wound up by this Court by order dated 2.4.2002 made in R.C.C.No.2 of 2002 and the Official Liquidator attached to this Court was appointed as its Liquidator. Pursuant thereto, the Official Liquidator having taken possession of the assets of the company in liquidation sold the same in terms of the order passed by this Court in C.A.No.437 of 2003 and the same was confirmed by this Court by order dated 23.10.2003 in C.A.No.437 of 2003. Subsequently as ordered by this Court in C.A.No.2885 of 2003, dated 24.12.2003 the Official Liquidator had disbursed interim dividend to IDBI, IFCI and ICICI out of sale proceeds. Similarly the second interim dividend was also disbursed to IDBI, IFCI and ICICI in terms of the order passed by this Court in C.A.No.516 of 2006, dated 13.9.2006. It is further stated that in response to the notice published by the Official Liquidator inviting claims from the creditors of the company in liquidation, 33 claims were received and out of the said claims the Official Liquidator had adjudicated the claims of the secured creditors and the workmen and the orders were communicated to them in Form No.69/70. It is explained that the remaining claims have not been adjudicated since the said claimants rank only second to the secured creditors and workmen of the company in liquidation and that they are not likely to yield any dividend. Hence the Official Liquidator seeks permission of this Court to dispense with adjudication of those creditors of the company in liquidation. It is explained that the dividend working shows that an amount of Rs.11,08,217-10 ps, Rs.5,02,815-89 ps, and Rs.6,50,536-71 ps is required to be refunded by IDBI, IFCI and ICICI respectively after adjusting their interim dividend of Rs.87,95,998/-, Rs.43,72,069/- and Rs.55,45,644/- respectively already paid to them as against their entitlement of Rs.76,87,780-90 ps, Rs.38,69,253-10 ps and Rs.48,95,107-29 ps respectively. Hence the Official Liquidator seeks direction from this Court to refund to IDBI, IFCI and ICICI a sum of Rs.11,08,217-10 ps, Rs.5,02,81s5-89 ps and Rs.6,50,536-71 ps respectively. It is further stated that whereas the Certificate in Form No.71 is required to be filed under Rule 167 of the Companies (Court) Rules, 1959 on or before 8.7.2004 i.e., within 3 months from 9.4.2004, the last date fixed for submission of the claims, the same could be filed only on 10.12.2010 and thus there is a delay of about 2349 days. While submitting that the delay was only on account of the failure of the claimants to submit the evidence in support of their respective claims, the Official Liquidator seeks to condone the delay of 2349 days in filing the Certificate in Form No.71. It is explained that as there was no response from the creditors for a long time and in the meanwhile as the office of the Official Liquidator had to concentrate on the process and adjudication of the claims received from the other companies in liquidation, the files of the company in liquidation remained pending for a long time. Subsequently during the special drive initiated in the office of the Official Liquidator, cleared all the pending claims for adjudication, the files relating to the company in liquidation have been traced and immediately thereafter adjudication was completed and the Certificate in Form No.71 has been filed in this Court in terms of Rule 167 of the Companies (Court) Rules, 1959. It is true that the certificate in Form No.71 should be filed within three months from the date of fixing for submission of proofs. However the explanation offered by the Official Liquidator in the affidavit filed in support of the application shows that the delay was occasioned for genuine reasons and there is no reason to hold that the delay had occurred in the office of the Official Liquidator deliberately or on account of negligence. Rule 167 read with Rule 7 of the Companies (Court) Rules, 1959 confers wide powers for enlarging the time fixed for filing Certificate in Form No.71 to meet the ends of justice. It is also relevant to note that the condonation of the delay in the present case does not adversely affect the rights of any of the parties, but on the other hand it would enable the winding up proceedings to reach the logical conclusion. Hence I deem it appropriate to condone the delay in filing the Certificate in Form No.71. Accordingly, the delay in filing the Certificate in Form No.71 is hereby condoned and the said Certificate is taken on record with a direction to the Registrar to notify the same as provided under Rule 169 of the Companies (Court) Rules, 1959. It is represented by the learned counsel for the Official Liquidator that the proposal made by the Official Liquidator to refund a sum of Rs.11,08,217-10 ps, Rs.5,02,815-89 ps and Rs.6,50,536-71 ps to IDBI, IFCI and ICICI respectively is in order. I also find force in the submission of the learned counsel for the Official Liquidator that the adjudication of the claims received from the Governmental Departments and the unsecured creditors are not likely to yield any dividend and therefore the Official Liquidator is hereby permitted to dispense with the adjudication of their claims. Accordingly, the Official Liquidator is permitted to dispense with the adjudication of other creditors and also to refund amounts as proposed to IDBI, IFCI and ICICI. All other reliefs are also hereby granted and both the Applications are ordered as prayed for. _____________ G. ROHINI, J. Dt. 18.01.2011 gbs