C.P. No.160 of 2008 (O&M) -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH C.P. No.160 of 2008 (O&M) in C.P. No.53 of 2004 Date of decision: 19.02.2009 2. C.P. No.161 of 2008 (O&M) 3. C.P. No.162 of 2008 (O&M) 4. C.P. No.163 of 2008 (O&M) Mrs. Rupinder Kaur .............. Petitioner Vs. M/s SFL Industries Limited (in liqn) and another ............Respondents Present: Mr. Anand Chhibbar, Advocate with Mr. Ranjit Chawla, Advocate for the petitioner. Mr. Dinesh Goyal, Advocate for Mr. Rajinder Singh, Advocate. Mr. Aman Chaudhary, Advocate for Official Liquidator. CORAM: HON'BLE MR. JUSTICE K. KANNAN 1. Whether Reporters of local papers may be allowed to see the judgment ? 2. To be referred to the Reporters or not ? 3. Whether the judgment should be reported in the Digest ? -.- K.KANNAN, J.(ORAL) C.A. Nos.829-832 of 2008 Applications allowed. Exemption from filing fair typed/certified copies of Annexures P-1 to P-13 is granted. C.P. Nos.160-163 of 2008 1. The petitions are filed for direction to the Official Liquidator to represent the company in criminal proceedings pending before Sh. S.K. Dhawan, Addl. Sessions Judge, Kurukshetra. The said criminal case was result of a complaint instituted by the State of Haryana, through Quality Centre Inspector, Kurukshetra, office of the C.P. No.160 of 2008 (O&M) -2- Deputy Director Agricultural, Kurukshetra for prosecution under Section 7 of the Essential Commodities Act, 1955 for contravention of clause 19(1)(a) of the Fertilizer Control Order, 1985. The petitioner had been summoned in the Criminal Court at the instance of one of the persons shown as accused in the complaint namely Rajinder Singh (accused No.6). On being summoned, the petitioner moved an application under Section 245 of Cr.P.C. seeking for discharge. The Court passed an order discharging her from personal criminal liability but still observed that she shall represent the company. She filed a petition under Section 482 of the Companies Act before this Court when the Court has passed an order in Crl. Misc. No.33795-M of 2006 observing that the case was to be remitted to the Special Judge to proceed further in the matter in accordance with law after ignoring the order passed earlier on 03.04.2006. 2. The petition seems to have moved again on behalf of the petitioner for setting aside the order passed on 03.04.2006 when the Court again directed that Ms. Rupinder Kaur should come present personally in Court on 04.11.2008 and the application filed on behalf of her stood dismissed. 3. The company has been ordered to be wound up on 26.05.2005 (Annexure P-7) and by orders of the Court, the Official Liquidator was appointed to take necessary steps in accordance with law. The order of winding up had also been directed to be published in the Indian Express (Chandigarh Edition), Dainik Bhaskar and the Punjab Govt. Gazette. It is a trite proposition of law that the company which is in liquidation shall be competent to be represented only C.P. No.160 of 2008 (O&M) -3- through the Official Liquidator. Learned counsel for the petitioner relies on the provisions of the Companies Act as obtaining relevance for consideration of the application namely Section 446 and 457. Section 457 of the Companies Act reads:- “457. Powers of liquidator:-(1) The Liquidator in winding up by the Court shall have power, with the sanction of the Court- (a) to institute or defend any suit, prosecution, or other legal proceedings, civil or criminal, in the name and on behalf of the company; (b) to carry on the business of the company so far as may be necessary for the beneficial winding up of the company;” (c) ...................... 4. According to him, the Official Liquidator under winding up shall have the power, with the sanction of the Court to defend any criminal proceedings held against the company. According to him, the Official Liquidator can represent the company and the direction already passed by the Criminal Court directing the applicant to represent the company shall have to be suitably modified that after the winding up of the company, it shall be unlawful for any one else other than the Official Liquidator to represent the company and therefore, the order passed by the Criminal Court that she shall represent the company till any other official as per law should be given effect to, by taking note of the subsequent development viz the order of winding up and the competence of the Official Liquidator to represent the company. 5. The Official Liquidator cannot be answerable for any criminal offence in relation to the company which is said to have C.P. No.160 of 2008 (O&M) -4- commenced even prior to the order of winding up. Section 446 of the Companies Act provides for staying of proceedings of winding up order being issued and no proceedings including criminal proceedings would be proceeded against the company except with the leave of the Court and subject to such terms as the Tribunal may impose. Under the circumstances, it shall not any longer be necessary for the petitioner to represent the company before the Criminal Court. The Official Liquidator shall not also be liable in any way for any criminal proceedings and if representation of the company is necessary, it shall be appropriate for the prosecuting agency to seek for appropriate directions before this Court, till that is done, any proceeding against the company as such, shall remain stayed. This shall be effective only as regards the representation of the company and shall have no bearing with reference to any other person proceeded against before the said Criminal Court in any individual capacity. 6. Mr. Rajinder Singh, sixth accused before the Criminal Court is represented through counsel and orally sought for impleadment in the petition on the ground that it shall be unlawful for the petitioner to be discharged by any order of this Court. The decision in the application filed by Ms. Rupinder Kaur has not received any adjudication of inter se disputes but the petition is directed at the issue whether Ms. Rupinder Kaur could represent the company after winding up. I have adverted only to an admitted issue of question of representation and the continuance of any proceedings against the company in liquidation. I do not think there existed any other issue for adjudication except representation of the petitioner for the C.P. No.160 of 2008 (O&M) -5- company after winding up order is passed. Prayer for impleadment of sixth accused as party is rejected. 7. C.P. Nos.160-163 of 2008 stands disposed of discharging the petitioner to represent the company in liquidation and any proceeding against the company before the Criminal Court shall not be proceeded with except with the sanction as contemplated by law. The petitions stand disposed of in above terms. (K. KANNAN) JUDGE February 19, 2009 Pankaj*