IN THE HIGH COURT OF JUDICATURE AT PATNA COMP. APP. No.7 of 2007 1. MRS.PRABHAWATI GUPTA w/o Late Rajendra Prasad 2. Rajeev Kumar 3. Alok Kumar -Both sons of Late Savitri Devi (deceased shareholder) 4. Yogendra Prasad 5. Devendra Prasad 6. Bhupendra Prasad 7. Bijay Kumar Prasad @ Bijay Kumar 8. Ajay Kumar Prasad @ Ajay Kumar - All sons of late Jamuna Prasad, deceased 9. Smt. Chandrakana Devi @ Chandrakanta Kumari Daughter of Lakshman Prasad, deceased 10. Ranjan Kumar, son of Late Ramnath Prasad 11. Smt. Prabha Devi, widow of Late Ramnath Prasad 12. Arun Kumar Prasad, son of Vidyasagar Prasad, deceased 13. Raj Kumar Prasad, son of Vidyasagar Prasad, deceased All are residents of Village – Kesaria, PS Kesaria, Distt. East Champaran ….Petitioenrs-Appellants Versus 1. OFFICIAL LIQUIDATOR, High Court, Mauryalok, 4th Floor, `A’ Wing, Dak Bungalow Road, Patna – 800 001 …. Opposite Party-Respondent 1st Party 2. Shyam Babu Prasad s/o Late babu Ganga Prasad Singh 3. Sushila Devi w/o Shri Shyam Babu Prasad 4. Rukmini Devi w/o late babu Ganga Prasad Singh 5. Hiramoni Devi w/o Sri Krishna Chandra Bhagat 6. Lal Muni Devi w/o Ramesh Chandra Gupta 7. Prabhawati Devi w/o Sri Sushil Kr. Gupta All are residents of At, P.O. & PS Kesaria, Distt. East Champaran 8. Harikrishna Prasad, adopted son of Late Baidyanath Prasad, resident of Village – Bhelahi, PS Bhelahi, Distt. East Champaran 9. Dhananjay Prasad, adopted son of Late Rameshwari Devi, resident of Village Bhelahi, PS Bhelahi, Distt. East Champaran ….Opp.Parties- Respondents IInd Parties ----------- 09- 15.3.2010 Heard Mr. Umesh Prasad Singh for the appellants, learned Official Liquidator, and Mr. R A Singh for respondent nos. 2 to 7. Some of the share-holders have preferred this appeal under Section 483 of the Companies Act 1956, (hereinafter referred to as `the Act’), and raise a grievance in respect of the order dated 15.2.2007, passed by the learned Company Judge, in Company Petition no.5 of 1977, whereby the Official Liquidator 2 has been directed to proceed and sell the assets of the company which shall be followed by settlement of the list of creditors. 2. The Company was incorporated on 10.2.1951, under the provisions of the Indian Companies Act 1913. The Registrar of the Companies, on 30.9.77, filed an application under Section 433(1) of the Act, that the company in question may be wound up on the ground that it had failed to submit its annual returns and balance-sheets for five consecutive years. The learned Company Judge passed the order dated 2.11.79, directing for winding-up of the company. The winding-up procedure did not register much progress. However, the learned Company Judge passed the order in question on 15.2.2007, inter alia, with the following direction :- “Winding up order having been passed 28 years earlier, I am not inclined to stay further proceedings for sale of the assets of the Company until settlement of the list of creditors, in the circumstances, I direct the Official Liquidator to proceed and sell the assets of the company.” 3. Learned counsel for the appellants submits that the position under the 1913 Act was that in case of surplus assets, the same can be divided in “specie”. The position has changed after the 1956 Act, wherein it is provided that assets can be distributed in “kind” also. In that view of the matter, in his submission, the appellants who are the share-holders, may be given option as per the list of priorities to retain their assets as per the entitlement. 4. The learned Official Liquidator has opposed the 3 appeal, while learned counsel for respondent nos. 2 to 7 has supported the appellants. 5. We have perused the materials on record and considered the submissions of learned counsel for the parties. We should first of all deal with the contention whether or not the appellants are entitled to distribution of assets in kind in the present case. Amended Article 98 of Schedule I, Table –A of the 1956 Act, according to the appellants, reads as follows:- “98.(1) If the Company shall be wound up, the liquidator may, with the sanction of a special resolution of the company and any other sanction of a special resolution of the company and any other sanction required by the Act, divide among the members, in specie or kind, the whole or any part of the assets of the company, whether they shall consist of property of the same kind or not. (2) For the purpose aforesaid, the liquidator may set such value as he deems fair upon any property to be divided as aforesaid and may determine how such division shall be carried out as between the members or different classes of members. (3) The liquidator may, with the like sanction, vest the whole or any part of such assets in trustees upon such trusts for the benefit of the contributories as the liquidators, with the like sanction shall think fit, but so that no member shall be compelled to accept any shares or other securities whereon there is any liability.” No such resolution of the company as contemplated by rule 98(1) has been brought to our notice. The question of applicability of the amended Article 98, is, therefore, completely obviated in the facts and circumstances of the present case. 6. It is evident on a perusal of the order in question that the order of liquidation was passed on 2.11.79, and no 4 progress has been registered for 28 years. In such a situation, it would be most unjustified on our part to interfere with the order of the learned Company Judge. We entirely agree with the order in question. We do not find any merit in this appeal. 6. In the result, the appeal is dismissed. ( S K Katriar ) ( Mungeshwar Sahoo ) mrl