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2005 Supreme(Guj) 369
Gujarat High Court
Judgename :K.A.Puj
ANKIL MEMBERS ASSOCIATION - Appellant
Versus
VIJAYSINH JADEJA, (LIQUIDATOR) - Respondent
COMPANY APPLICATION 197 of 2004
Decided On : 05/13/2005
Headnote:Companies Act, 1956 (Central Act 1 of 1956) - Sections 391 to 394, 488, 494 & 497 - Transfer of Property Act, 1882 (Central Act 4 of 1882) - Section 5-BA - Income Tax Act, 1961 (Central Act 43 of 1961) - Sections 2(47), 46 & 48 - Voluntary wound-up of Company - Report by official liquidator - Absence of - Resolution by creditors for revival of company - Scope of - In absence of report by official liquidator necessary stage which requires the Company to be voluntary wound-up and dissolved has not been reached - Therefore, Corporate status and corporate power of the Company continued - In the circumstance there is no impediment under any statute to prevent the members and creditors from passing resolutions for revival of the Company - Objection with regard capital gains tax and stamp duty has no substance and cannot be accepted in view of the fact that status of the Company has not been changed - Objection, therefore, raised by official liquidator disallowed.
The Court is of the view that necessary stage which requires the Companies to be voluntarily wound up and dissolved has not yet been reached as the O.L. has not filed any report before this Court as required under Section 497(6) of the Act. In absence of any such report, it cannot be said that the Company is already dissolved. Section 497(6) of the Act clearly stipulates that from the date of the submission of the report to the Court, the Company shall be deemed to be dissolved and Section 487 of the Act makes it abundantly clear that the corporate status and corporate powers of the Company shall continue until it is dissolved. The combined reading of Sections 487 and 497(6) of the Act makes it clear that the Companies status has still not been changed and though the necessary declarations and resolutions were passed for taking the companies into voluntary liquidation, the same would not ipso facto result into dissolution of the Company as the missing stage of filing the report by the O.L. is still to be reached and before the said stage is reached, the members and contributories as well as the Creditors have unanimously decided to revive the Company. There is no impediment under any statute to prevent the members and creditors from passing such resolutions for revival of the Companies.
[Para 21]
With regard to the objections raised by the O.L. on the ground of avoidance of Capital Gains Tax as well as Stamp Duty under the Bombay Stamps Act, the Court is of the view that the status of the Companies has not been changed from the date of passing the Resolution for voluntary winding up till this date. The O.L. has not sent his report to this Court and the revival applications are pending before this Court. Thus, there is neither any transfer of assets of the Companies nor there is any distribution of assets amongst the members/contributories.
Cases Referred :
Voluntary Liquidator, Dimples Pvt. Ltd. vs. Registrar of Companies, 1978 (48) Company Cases 98;; V.B. Purohit vs. Gadag & Jambukeshwara & Anr., 1984 (56) Company Cases 360;; Narendra Bahadar Tandon vs. Shankar Lal, 1982 (52) Company Cases 62 = AIR 1980 SC 575.-Relied on
( 1 ) THE point involved in all these four applications is similar one and hence, all these four applications are being disposed of by this common judgment. For the sake of convenience, the facts are taken from Company Application No. 197 of 2004. Except the change in the name of the companies in each of these four applications, there is no other change and applicants are same as well as Liquidator appointed for all the four companies is also same.
( 2 ) THE applicants have taken out Judges Summons in all these four applications requesting this Court to issue appropriate order, direction under the provisions of Section 518 of the Companies Act, 1956 for revival of the Companies in liquidation, in view of unanimous Resolutions dated 20. 04. 2004 passed by all the Shareholders / Contributories i. e. the applicants herein and the Creditors of the Companies for their revival, in the interest of justice and equity.
( 3 ) AN affidavit in support of the Judges Summons taken out in Company Application No. 197 of 2004 is filed by Shri Parshottambhai Patel, an authorised representative of the applicants. It is stated therein that the applicants are the contributories / shareholders of Tulsi Farms Pvt. Ltd. The said Company was incorporated as a private limited Company on 20. 03. 1995 and was issued the certificate of incorporation by the office of the Asst. Registrar of Companies, Gujarat. Since there was no business, the Board of Directors of the Company decided to wind up the Company by following the procedure for voluntary winding up under the Act. The Board of Directors accordingly made a declaration of solvency as required under Section 488 of the Act and delivered the same with the office of Registrar of Companies for registration in prescribed form i. e. Form No. 149. Thereafter, the members of the Company passed Special Resolution as required by the Act resolving to wind up the Company as the members voluntary winding up. The said Resolution was also filed with the Registrar of Companies in Form No. 23. The Company also resolved to appoint the respondent No. 1 as Liquidator of the Company for the purpose of winding up. The notice of the Resolution came to be published in the local daily, namely, Asian Age. The Liquidator so appointed took necessary steps under Section 494 of the Act for distribution of the assets of the Company to the shareholders who are incidentally also the only Creditors of the Company. The Company has only two Shareholders, who are the applicants and these applicants are also the only Creditors of the Company. The distribution of the assets of the Company has only been made on paper and there has been no actual distribution of assets. The Liquidator has convened the meeting under Section 497 of the Act and prepared final statement of accounts. A copy of final statement has been submitted by the Liquidator to the Registrar of Companies as also to the O. L. as required under the Act by a communication dated 04. 02. 2003.
( 4 ) IT is further stated that though the statement of accounts was submitted by the Liquidator way back on 04. 02. 2003, no steps were initiated by the O. L. for submitting the final report before this Court. In the meanwhile, on account of long delay, the Shareholders/creditors of the Company decided to again revive the Company. The applicants accordingly requested the Liquidator by communication dated 09. 03. 2004 to convene a meeting of the shareholders and creditors for passing necessary resolution for revival of the Company. In the said communication, it was stated that there has been no actual transfer of property on account of the pendency of the report by the O. L. Hence, there has been no effective change in the assets of the Company. It is further stated that apropos to the request made by the applicants, the Liquidator fixed 20. 04. 2004 as the date for convening the meeting of shareholders/creditors of the Company. The Liquidator also published a public notice dated
