OFFICIAL LIQUIDATOR Vs. E.N. VASUDEVAN

JUDGEMENT

(1.) This is an application filed by the Official Liquidator, under S.460(4) of the Companies Act, 1956 read with rule (9) of the Companies (Court) Rules, 1959 for direction in relation to a matter arising in the winding up of the Palmland Corporation (P) Limited.

(2.) The company was ordered to be wound up on 1st June 1973. Even before that by an order dated 29th January 1973, this Court had appointed the Official Liquidator as the provisional liquidator. In the course of attempting to take possession of its assets, it was found that in some offices of the company, the books of another concern known as the 'Palmland Educational Trust' were being maintained and kept. In some places the offices of the company were functioning in buildings or rooms let out to the trust, and in some places, it was the other way round. The directors of the two were treating the company and the trust as 'sister concerns'; they were even agreeable to the trust being treated as an agent of the company. It appears that there were two other 'sister concerns', one called 'Palmland Coimbatore' and another called 'Palmland Trading Company, Madurai'. On a report and a request for directions by the Liquidator, this Court directed him on 8th February 1973 to take possession of all the assets of the concerns said to be associated with the company, subject to the condition that objections, if any, would be considered and disposed of later.

(3.) On further enquiries, the Liquidator came to learn that the trust was a society registered under the T. C. Literary, Scientific and Charitable Societies Registration Act (Act XII of 1955), and that practically the same set of persons were in management of the company and the trust. The affairs of the two appeared to be so mixed up and inter connected that prima facie, at any rate, the Liquidator thought that the trust was only a cover for the activities of the company in another form and that in reality the assets of the trust were the assets of the company itself.