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1983 Supreme(Gau) 103

GAUHATI HIGH COURT
B. L. HANSARIA AND Dr. T. N. SINGH, J.
Narmada Choudhury and others, petitioners -Appellant
Versus
Motor Accident Claims Tribunal, Kamrup, Gauhati and others -Respondent
Civil Rule No. 24 of 1979
Decided On : 25-07-1983

Advocates Appeared:
P. Choudhury and A.K. Choudhury, B. Sarma (for Nos. 3-8), S.N. Chetia, Central Govt. Standing Counsel (for No. 9) and V.K. Dewan and R.P. Sarma (for No. 10)

The liability of ex-Directors does not automatically devolve on them upon the dissolution of the company, and the statutory liability of the insurer under the Motor Vehicles Act extends to the entire amount of the award, not limited to the specified amount in the award.

Headnote:

Certificate-Debtors - Motor Accident Claims Tribunal - Companies Act, Section 560(5), Motor Vehicles Act, Section 95(2)(b) - The court discussed the effect of the dissolution of a company on the liability of ex-Directors and the statutory liability of the insurer under the Motor Vehicles Act. The court quashed the order substituting ex-Directors as certificate-debtors and directed the insurer to deposit the balance amount of the award to satisfy the entire award.

Fact of the Case:

The Motor Accident Claims Tribunal substituted ex-Directors of a dissolved company as certificate-debtors in place of the company against which an award was passed. The ex-Directors challenged the order, contending that the Tribunal had no jurisdiction to pass the order and that they were not liable for the debt of the dissolved company.

Finding of the Court:

The court found that the liability of the ex-Directors did not devolve on them as a result of the dissolution of the company. It also held that the statutory liability of the insurer under the Motor Vehicles Act extended to the entire amount of the award, not limited to the specified amount in the award.

Issues: The issues involved the jurisdiction of the Tribunal to substitute ex-Directors as certificate-debtors, the effect of company dissolution on the liability of ex-Directors, and the statutory liability of the insurer under the Motor Vehicles Act.

Ratio Decidendi: The court held that the liability of ex-Directors does not automatically devolve on them upon the dissolution of the company. It also determined that the statutory liability of the insurer under the Motor Vehicles Act extends to the entire amount of the award, not limited to the specified amount in the award.

Final Decision: The court quashed the order substituting ex-Directors as certificate-debtors and directed the insurer to deposit the balance amount of the award to satisfy the entire award.

Judgement

Dr. SINGH J. :- A short and, simple: point of law has been agitated in this writ application by two ex-Directors of a defunct company. Their grievance is that the Motor Accident Claims Tribunal purporting to act as an executing court substituted them as certificate-debtors in place of the defunct company against which an award was passed by the learned Tribunal. The pathology of the case is truly revealed by the following facts laid bare in its essential detail.

2. On 21-9-1962 one of the vehicles owned admittedly by M/s. National Transport (India) Pvt. Ltd. (hereinafter, the company) collided with, an engine of a running train at the Noonmati Railway level crossing near Gauhati. One Dulal Chandra Chaksaborty, an young typist aged 21, in employment of the hirer of the vehicle (M/s. Oil India Ltd.), traveling by the said Bus, in the course of employment, sustained serious injuries in the said accident resulting in his death. On a claim being preferred by Mahim Chandra Chakraborty, the father of the deceased, the Motor Accident Claims Tribunal, Gauhati, by its award dated 28-1-1975, passed in MAC Case No. 45(K)/72, allowed the same with, interest and costs and by the same order also determined the respective liabilities of the aforesaid owner of the vehicle M/s. National Transport. (India) Private Limited and M/s. New India Assurance Company Ltd. with whom the vehicle was insured. Taking, into consideration the terms of the policy and the provisions of Section 95 (2) (b) if the Motor Vehicles Act the insurer was directed to pay Rupees 2,000/- and the balance Rs. 13,000/- was made payable by the owner. A Bakijai Case being Case No. 24/74-75 was started against the company for realisation of the awarded amount and a notice under Section 7 of the Bengal Public Demands Recovery Act was issued on 29-12-1976 against the said Company as the certificate-debtor. Before the Bakijai Officer the petitioners filed an objection stating that the said company was dissolved under the Companies Act by a notification published, in the Gazette of India dated 21-4-1973 and further that as members of the dissolved company they were not in any way liable for the debt of the dissolved company. On 12-7-1977 the Bakijai Officer passed an order upholding the plea of the petitioners and directing that the proceeding may continue only against the assets of the company and not against the personal property of the objectors, who are the petitioners before us. On 19-11-1977 the Bakijai Officer passed an order to the effect that the company was not in existence and it had no moveable property and therefore it was not possible to realise the amount. It was further directed that the demand certificate be returned to the departmental authority for necessary action. In the meantime, however, on 13-10-77, the heirs of the claimant, Mahim Chandra Chakraborty who, as it appears, passed away during the pendency of the proceeding, filed an application before the learned Tribunal substituting the petitioners as ex-Directors of the dissolved company in place of the said company on which show cause notices were issued to the petitioners. After hearing the parties the learned Tribunal by its order passed on 16-8-78 allowed the prayer and directed that a fresh certificate in the name of newly added opposite parties, namely, the petitioners, be issued. Accordingly, on 23-10-78, a certificate bearing No. STAT/105/78, dt. 3-10-78 was issued by the Certificate Officer, Gauhati, against the petitioners naming them as the certificate-debtors for realisation of the awarded, amount. The validity of this certificate and the learned Tribunals order dt. 16-8-78 are challenged in these proceedings in this court.

3. It is contended before us by Mr. P. Choudhury, the learned counsel for the petitioners, quite rightly in our opinion, that the learned Tribunal had no jurisdiction to pass the impugned order and further that as the learned Tribunal, misdirected itself in holding the pe



































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