RAMAMURTHI OFFICIAL LIQUIDATOR Vs. INDIAN BANK

JUDGEMENT

(1.) DINASARI Ltd. now under liquidation, started as a private limited company in 1944. It was publishing two papers called "DINASARI" and "Kandipam." Its memorandum of association permitted it, among other things, "to carry on the business of ........ dealers in printing machinery furniture, type, ink, paper etc." In an affidavit filed by the Official Liquidator and dated 29th July, 1954, it is stated that the company was importing large quantities of news-reel and printing ink which it was using not merely for purposes of the papers it was publishing but also for sale on profit

(2.) BY an order made in O.P. No. 96 of 1952 the company was ordered to be wound up The Indian Bank claimed that various quantities of newsprint had been pledged to it by the company and on various dates in April, 1952, and, later this newsprint was sold for a sum of Rs. 92, 227-2-0. The Indo-Commercial Bank Ltd., made a similar claim in respect of other quantities of news-reel and these were sold on 11th December, 1952, for a sum of Rs. 8, 606-6-6 Two petitions have been filed in relation to the moneys thus realised. Application No. 4436 of 1954 is one by Narayana Rao, and his case is this. In January, 1951, in association with four of his friends he formed a syndicate for the purchase and sale of paper. In January, 1951, they purchased various quantities from "Dinasari Ltd." A further two lots were purchased in February, 1951. Yet more lots were purchased on 31st March, 1951, 4th April, 1951, 10th April, 1951, 23rd May, 1951, 18th October, 1951, and 28th December, 1951. In his affidavit he stated

(3.) THE case of the Indian Bank Ltd. is that there had been a valid pledge of the goods sold at its instance, that it is secured creditor in respect of the amounts due to it, and that it is perfectly entitled to appropriate the amount realised by the sale of the pledged goods towards the money due to it. THE contention of the liquidator that the goods formed the stock in trade of the Dinasari Ltd. is not sound. THE affidavit filed on behalf of the bank states