Btw Industries Ltd. Vs. Pressman Advertising and Marketing Ltd. - Court Judgment

Excerpt:
the court: this is the unfortunate case of the petitioning creditor whose debt of rs.5 lacs was more or less held by the court to be due and payable by the company to it. the company was directed to furnish such security at the appellate stage. if the company had prosecuted the appeal, it was likely that the petitioning creditor would have got the amount as a condition for not winding up the company. but the company chose not to prosecute the appeal which was dismissed, on an application made by the petitioning creditor for such purpose. now the question is what will happen to the security? the petitioning creditor wants this security. the position in law is a little different. after all the security was the fund of the company being held by the registry of this court. upon winding up the official liquidator has a claim to such fund, as the same is an asset of the company. therefore, i take a very sympathetic view of the petitioning creditor and direct the official liquidator to proceed with the task of winding up of this company as expeditiously as possible so that the petitioning creditor may be paid its legitimate dues. such exercise should be completed within a period of one year from date. the petitioning creditor will be at liberty to lodge its claim with the official liquidator in accordance with law. upon the claim being so lodged the official liquidator will consider it for admission and payment with the approval of the court. the registrar, original side who is said to be holding the said security of rs.5 lacs along with accrued interest thereon is directed to make over the entire sum, after deducting his commission, to the official liquidator within a period of four weeks from the date of service on him of a copy of this order. registrar, original side and all parties concerned are to act on a signed photocopy of this order on the usual undertakings.

Judgment:
The Court: This is the unfortunate case of the petitioning creditor whose debt of Rs.5 lacs was more or less held by the Court to be due and payable by the company to it. The company was directed to furnish such security at the appellate stage. If the company had prosecuted the appeal, it was likely that the petitioning creditor would have got the amount as a condition for not winding up the company. But the company chose not to prosecute the appeal which was dismissed, on an application made by the petitioning creditor for such purpose.

Now the question is what will happen to the security? The petitioning creditor wants this security. The position in law is a little different. After all the security was the fund of the company being held by the registry of this Court. Upon winding up the Official Liquidator has a claim to such fund, as the same is an asset of the company.

Therefore, I take a very sympathetic view of the petitioning creditor and direct the Official Liquidator to proceed with the task of winding up of this company as expeditiously as possible so that the petitioning creditor may be paid its legitimate dues.

Such exercise should be completed within a period of one year from date. The petitioning creditor will be at liberty to lodge its claim with the Official Liquidator in accordance with law. Upon the claim being so lodged the Official Liquidator will consider it for admission and payment with the approval of the Court.

The Registrar, Original Side who is said to be holding the said security of Rs.5 lacs along with accrued interest thereon is directed to make over the entire sum, after deducting his commission, to the Official Liquidator within a period of four weeks from the date of service on him of a copy of this order. Registrar, Original Side and all parties concerned are to act on a signed photocopy of this order on the usual undertakings.