The main legal point established in the judgment is the interpretation of Rule 156 of the Companies (Court) Rules 1959, which limits the interest payable on a debt or sum to simple interest @ 4% p.a. after the date of maturity in the absence of an agreed rate of interest.

1. This is an application filed by the Official Liquidator (‘OL’) attached to this Court under Section 446 of the Companies Act, 1956 (‘Act’) seeking to recover from the Respondent, Mrs. Madhu Bala Sharma, a sum of Rs. 6,13,408/- together with interest @18% p.a. from June 2006 till realization along with administrative expenses of the OL and costs.

2. The background to this application is that Anand Pratyabhoot Vitt Nigam Ltd. (hereafter the ‘company’) was ordered to be wound up by this Court on 9th October 1997. The OL was appointed as its Liquidator. On 16th February 2005, the Court directed the OL to invite claims from the creditors and the workmen of the company. Notices to that effect were published in the newspapers and the claims received were processed by the OL.

3. The Respondent along with her husband had made a total of twenty investments in the sum of Rs. 82,099/- between 23rd April 1988 to 24th June 1989 in two schemes of the company, i.e., fixed deposit scheme and hire purchase scheme. It is stated that under both the schemes, the cumulative/compound rate of interest @ 14% (for fixed deposit) and 27% quarterly or 30% p.a. (for hire purchase scheme) was payable.

4. The Respondent submitted claims in all the twenty investments along with the originals of the certificates of fixed deposits and the hire purchase agreements. She also furnished the calculations of maturity value of the investments from the date of deposit till the date of winding up, i.e., 9th October 1997. By a letter dated 4th November 2006, the OL informed the Respondent that her claim in the sum of Rs. 7,42,509/- had been admitted. The payment of the said sum was made on 12th May 2006.

5. While hearing the main winding up petition, the Court was on 7th September 2009 informed that the OL was in the process of re-examining the question of settlement of claims. The Court was also informed that certain complaints had been received which were under examination. The Court required a status report to be filed.

6. By letter dated 5th October 2009, the Respondent was requested to attend the office of the OL on 14th October 2009. Mr. V.K. Sharma, the husband of the Respondent, attended the office of the OL on 14th October 2009 and informed the OL that Mrs. Madhu Bala Sharma had in computing her claim included the compound interest. Taking the stand that no compound interest as such was admissible on her claims, the OL by letters dated 24th November 2009 and 14th December 2009, requested Ms. Madhu Bala Sharma to return the excess of Rs. 4,81,169/-.

7. On 21st January 2010 the Court granted the OL four weeks’ time to file a status report with respect to each claim. It was directed that “the report will also point out all particulars of the officer or officers handling these claims. It is also open to the Official Liquidator to seek the assistance of a Chartered Accountant, if he considers it necessary to do so in this matter.” Consequent upon the above order, the OL engaged the services of M/s Rai & Co., Chartered Accountant (‘CA’) and the claims filed were handed over to them. In the report the CA set out the principal amounts as well as the maturity value of the deposits. The CA found that some of the disbursements made, including that made to the Respondent, were in excess of their legitimate dues. The OL then calculated that an excess payment of Rs. 4,81,169/- was made to the Respondent. On the above basis, the present application was filed on 12th July 2010. It was, inter alia, stated in para 8 of the application as under:

“8. That in this regard the claim of Smt. Madhu Bala Sharma was sent to the Chartered Accountant for re-examination and the reply has been received from the Chartered Accountant in respect of the above said claim and he informed to this office that the principal amount of Rs. 82,099/- has been claimed in the affidavit. The interest was calculated up to the date of maturity and not up to the date of winding up which affec