LAWS(KAR)-2013-12-522

M/S. MOTHER CARE INDIA LIMITED (IN LIQUIDATION), REPRESENTED BY THE OFFICIAL LIQUIDATOR Vs. SHRI. S.N. RAJENDRAN AND DHFL VYSYA HOUSING FINANCE LIMITED

Decided On December 17, 2013
M/S. Mother Care India Limited (In Liquidation), Represented By The Official Liquidator Appellant
V/S
Shri. S.N. Rajendran And Dhfl Vysya Housing Finance Limited Respondents

JUDGEMENT

(1.) HEARD the learned Counsel for the applicants. These applications are filed in common circumstances, in that, it is the common allegation by the Official Liquidator that the respondent - Bank has brought to sale five apartments, which were charged as security for the loans borrowed from the respondent - Bank by the company -in -liquidation and even during the pendency of the winding up petition, the respondent - Bank, which claimed to be unaware of the winding up proceedings, had brought the properties to sale. It is on realizing the fact of such sale subsequent to the order of winding up, that the Official Liquidator has brought these applications seeking to bring the respondent - Bank to book. It is in that background that the present applications are now listed before the court for final hearing.

(2.) AT the outset, the learned Senior Advocate Shri S. Naganand appearing for the Counsel for the respondents - 2 and 3 would point out that the legal issue involved here is factually covered and is settled by a catena of decisions and would draw attention firstly, to the law laid down by the apex court in the case of M.K. Ranganathan and another vs. Government of Madras and others, : AIR 1955 SC 604. While interpreting Section 232 of the Indian Companies Act, 1913, which corresponds to Section 537 of the Companies Act, 1956, the apex court, in almost similar circumstances, has opined thus:

(3.) THE learned Counsel for the Official Liquidator however, would point out that insofar as the workmen's dues are concerned, they are in any case protected. And notwithstanding the claim that the Secured Creditor was enabled to stand outside the winding up and enforce the security, the interest of the workmen would yet have to be protected and therefore, any realisation of the monies, by bringing the properties to sale, would to the extent of the workmen's dues still have to be secured and as there -is yet to be a determination of the workmen's dues, the respondent may be called upon to furnish adequate security to safeguard the interest of the workmen. Accordingly, the applications are partly allowed. In that, the sale effected by the respondents in respect of the properties in question cannot be held to be void. However, respondents - 2 and 3 shall execute a bond in favour of the Official Liquidator securing the interest of the workmen to the extent of their dues, which shall be determined in the near future and the bond shall be kept alive till such determination and a pari passu settlement in favour of the workmen to the extent that the respondents 2 and 3 would be liable.