NATIONAL STEEL AND GENERAL MILLS Vs. OFFICIAL LIQUIDATOR

JUDGEMENT

(1.) This reference raises an interesting question of law whether summons or application can be moved by the (1) Company, (2) Creditor, (3) member with a view to proposing compromise or arrangement between Company and Creditors and Members under Section 391 of the Companies Act, 1956 (hereinafter referred to as "the "Act") in case the Company is being wound up or can it be filed in such a situation exclusively by .the liquidator alone ?

(2.) In the present case, the summons have been moved by Messrs. National Steel & General Mills (1) Limited (hereinafter referred to as 'the Company'), under Section 391 of the Act proposing a scheme of arrangement between the Company and ifs unsecured creditors, and in support of such summons the affidavit of Shri D.B. Sharda, erstwhile Director of the Company has been filed. The Company has been wound up under the orders of the Court dated August 1, 1988.

(3.) 'The reference has been made to this Bench for the 'reason that two views have been expressed by this Court, in 'regard to the maintainability of the application/summons filed by the Company, creditor or member, in case the Company is 'being 'wound up under Section 391 of the Act. At this stage it will be relevant to point out that the summons in this case have been moved by the Company, but for the purpose of maintainability of the application/summons, in the case of the Company being wound up, the Company, creditor, member have been placed in the same and equal footing in Section 391 of the Act. There is no dispute, however, before the winding up process begins Company/creditor/member has every right to commence . the proceedings under Section 391 of the Act.