THE HON'BLE SRI JUSTICE B.SESHASAYANA REDDY Company Application No.758 of 2011 ORDER:- This application has been filed by the Official Liquidator representing Sri Krishna Tulasi Chit Fund Private Limited under Section 460(4) of the Companies Act, 1956 read with Rules 7, 9 and 168 of the Company (Court) Rules, 1959, seeking permission to transfer back a sum of Rs.62,400/- from the 2nd dividend amount of Rs.70,000/- available to the credit of V.Giridhar to the PD account of the Company. Further relief has been sought for to adjust the excess amount paid to V.Satyanarayana and pay the balance amount towards 3rd dividend, and declaration of dividend @ 11 paise in a rupee amounting to Rs.11,79,345.12 P.S., to the entitled creditors has also been sought for while dispensing with the publication of notice of dividend in newspapers and permitting the Official Liquidator to pay the dividend during six months period after issuing Notice in Form No.138. This Court by order dated 30-1-2002 made in Company Application No.379 of 2000 permitted the Official Liquidator to invite claims from the creditors of the Company (in Liqn). Accordingly, the Official Liquidator published notice in Form No.63 inviting claims from the creditors fixing the last date for receiving all the claims as 25-2- 2002. In response to the said publication, the Official Liquidator received 101 claims. Out of 101 claims, 83 claims were admitted for a sum of Rs.1,10,27,077/- while rejecting 18 claims due to lack of sufficient proof and for non-filing of the claims within the stipulated time. Subsequently, the Official Liquidator filed Company Applications 90/2003 and 88/2003 seeking declaration of dividend @ 10 paise in a rupee aggregating to Rs.11,02,707.20 P.S., to 76 claimants. The said applications came to be allowed on 14-2-2003. Accordingly, dividends were paid to the entitled creditors from 17-3-2003 to 16-9- 2003. After expiry of six months period, the Official Liquidator in terms of Section 555 (3) of the Companies Act, 1956, transferred the unpaid dividend amount of Rs.1,72,855.55 P.S., to the Registrar of Companies in Form No.159 of the Company (Court) Rules, 1959. Subsequent to the declaration and disbursement of the first dividend, 2 claimants have obtained relief under Rule 177 of the Company (Court) Rules, 1959. In terms of the orders passed by this Court on 14-2-2003, the Official Liquidator adjudicated the two claims for Rs.65,200/-. The Official Liquidator had filed Company Application No.1271 of 2005 seeking permission to vary the list of creditors of the Company in Form No.71 while seeking sanction for declaration of dividends @ 10 paise in a rupee to one belated creditor towards first dividend and second dividend @ 14 paise in a rupee in respect of all 77 claims. The said applications came to be allowed on 8-12-2005. Accordingly, the Official Liquidator declared and disbursed first and second dividend amounting to Rs.15,55,290.78 P.S., from 6-1-2006 to 5-7-2006. After accomplishment of 1st and 2nd dividends @ 10 paise and 14 paise in a rupee respectively, the Official Liquidator received the belated claim of one C.Suryanarayana in Form No.66 on 8-12-2008 claiming a sum of Rs.2,17,000/-. The Official Liquidator filed Company Application No.68 of 2003 seeking a decree for a sum of Rs.2,17,000/- being the debt due to be paid by the claimant and others in prized chit No.23 of Chit Group No.KLT 3A. The said application came to be dismissed on 24-11-2008 treating C.Suryanarayana as a creditor of the Company to the extent of Rs.2,17,000/- after reducing the receipt of Rs.63,000/- from the actual subscription of Rs.2,80,000/- paid by the claimant. The Official Liquidator in terms of the observations made by this Court in Company Application No.68 of 2003 dated 24-11-2008, adjudicated the belated claim of C.Suryanarayana for a sum of Rs.2,17,000/-. The Official Liquidator filed Company Application No.839 and 840 of 2010 seeking permission of the Court to vary the list of creditors and for disbursement of dividend to C.Suryanarayana. The said applications came to be allowed and accordingly the Official Liquidator disbursed the dividend amount to C.Suryanarayana. The claim of V.Giridhar to a tune of Rs.5,00,000/- was initially admitted. Subsequently, as per the directions of this Court a sum of Rs.2,60,000/- was allowed as set off against the admitted debt of Rs.5,00,000/- leaving the balance admitted amount of Rs.2,40,000/- available to the credit of V.Giridhar. The first dividend of Rs.50,000/- declared @ 10 paise in a rupee was received by V.Giridhar and the second dividend of Rs.70,000/- declared @ 14 paise in a rupee still remained unclaimed by the said V.Giridhar. The dividend amounts have been calculated to the account of said V.Giridhar taking the amount payable to him as Rs.5,00,000/-. But after giving set off, the total amount payable to him is only Rs.2,40,000/-. Accordingly, he is entitled for 10 P.S. + 14 P.S., dividend on the said amount. Since excess amount has been paid to V.Giridhar, the Official Liquidator sought for transfer of the excess amount of Rs.62,400/- from the second dividend amount of Rs.70,000/- available to the credit of V.Giridhar to the PD account of Company. So far V.Satyanarayana is concerned, the Official Liquidator also sought for set off of the amount payable to him and consequently after giving set off, the amount which the Company is liable to pay is Rs.45,000/- (Rs.70,000/- less Rs.25,000/- set off). If the dividends paid to V.Satyanarayana is calculated, it comes to Rs.13,300/- which is equivalent to 29.55% of the balance admitted amount of Rs.45,000/-. In fact he is entitled for only 10 paise and 14 paise in a rupee. The excess amount paid to him is required to be adjusted towards third dividend. Hence, this application seeking the reliefs stated supra. Heard learned Counsel appearing for the Official Liquidator and perused the order dated 29-12-2006 wherein set off has been permitted in respect of V.Giridhar and V.V.Ramana. The relevant portion of the order, dated 29-12-2006 reads as hereunder:- “With reference to the claim made by the subscribers, the Official Liquidator filed a report conceding the claim of the subscribers and bringing to the notice of this Court that after adjustment of the amount available to the credit of the husband of the first respondent against the amount payable by the first respondent – wife, still there is a balance of Rs.2,40,000/- available to the credit of the husband of the first respondent. In view of the conceding facts, the Official Liquidator is directed to give the benefit of set off of Rs.2,60,000/- payable by the first respondent-wife against the amount available to the credit of the first respondent’s husband. After adjustment, still there will be a sum of Rs.2,40,000/- available to the credit of the first respondent’s husband, to which, he is entitled to as and when the dividends are declared and paid to other subscribers.” Indisputably, V.Giridhar is entitled to dividend taking the amount due payable by the Company to him as Rs.2,40,000/-. In that view of the matter, from the amount of Rs.70,000/- available to the credit of the V.Giridhar, a sum of Rs.62,400/- is transferred to the PD account of the Company. Accordingly, the application is ordered as prayed for. No costs. _________________________ B.Seshasayana Reddy, J 15th July, 2011 smr