Misfeasance proceedings cannot be initiated against deceased directors or officers' heirs beyond the limitations period under Section 543 of the Companies Act.

1. The appellant is the Official Liquidator of Jai Hind Estate and Housing Co. Ltd. (in Liquidation). He had taken out Company Application No. 161 of 1981 against 16 respondents under S. 543(1) of the Companies Act, 1956 for a declaration that respondents Nos. 1 to 16 being Directors and / or officers and / or Auditors of the above Company had misapplied and / or become liable and / or accountable for the money or property of the Company and / or were guilty of misfeasance and / or malfeasance and / or non - feasance and / or breach of trust in relation to the said company in respect of various amounts as set out in the prayers to that Company Application. This Company application was taken out on 15th June, 1981.

2. Eight years thereafter, the Official Liquidator took out Company Application No. 75 of 1988 by which the Official Liquidator sought to bring on record the heirs' of deceased respondents Nos. 1 and 16 in Company Application No. 161 of 1981. This Company Application No. 75 of 1988 has been dismissed by the learned single Judge. Hence the present appeal is preferred by the Official Liquidator. For the sake of convenience respondents Nos. 1 and 16 in Company Application No. 161 of 1981 are hereinafter referred to as respondents Nos. 1 and 16.

3. It is necessary to note the following facts :
The order of winding up against the Company was made on 23-6-1976. Respondents Nos. 1 and 16 being the Managing Director and Auditor of the Company respectively, both died prior to 1980. Respondent No. 16 died in September 1977. The misfeasance Summons (Company Application No. 161 of 1981) was taken out by the Official Liquidator on 16th June 1981. Therefore, at the time when the Misfeasance Summons was taken out against respondents Nos. 1 and 16, both were dead. It seems that respondent No. 9 in the Misfeasance Summons filed an affidavit dated 11th September 1981 in which he set out that the Misfeasance Summons was bad in law inasmuch as it was taken out against respondents Nos. 1, 2, 4, 5, 6, 12, 13 and 16 who had all died prior to 1980.

4. According to the Official Liquidator in view of this statement in the affidavit of 11th September 1981, he made certain enquiries but was unable to find out the heirs of the dead Respondents. It is not clear what these inquiries were. According to the Official Liquidator he received information for the first time from the Advocates of Respondent No. 13 in the misfeasance summons when they wrote a letter dated 12th January 1988 informing the Official Liquidator of the heirs of deceased Respondent No. 1. The Official Liquidator has not set out anywhere how he discovered the name of the heir of the deceased Respondent No. 16. But he appears to have written a letter dated 11th December 1987 to Dilip Jayantilal Thakkar, the son and heir of Respondent No. 16 asking for the date of death of Respondent No. 16 and enquiring about other heirs and legal representatives of the deceased Respondent no. 16. Therefore, the name of at least one heir of Respondent No. 16 was known to the Official Liquidator in December 1987. He thereafter took out the present Company Application No. 75 of 1988 on 19th February 1988 to bring the heirs of Respondent No. 1 who are arraigned before us as Respondent Nos. 9, 10 and 11 in the appeal and the heir of Respondent No. 16 viz., Dilip Jayantilal Thakkar who is Respondent No. 12 in the appeal.

5. Under S.543 of the Companies Act sub-secs. (1) and (2) provide as under : -
"543. Power of the Court to assess damages against delinquent directors, etc. -
(1) If in the course of winding up a company, it appears that any person who