ASRA ESTATES LIMITED Vs. STATE

JUDGEMENT

(1.) This petition is filed, under Sec. 433(a), (c), (e) & (f) and 439 of the Companies Act, 1956 read with Rule 95 of the Companies (Court) Rules, 1959, for winding up of the petitioner company.

(2.) The petitioner, hitherto a partnership firm carrying on business in the name of M/s Asra Estates, was incorporated under Part IX of the Companies Act, 1956 on 23.02.2000 as Asra Estates Private Limited. Its name was subsequently changed to Asra Estates Limited and a fresh certificate of incorporation was issued. The Registered office of the petitioner is at Hyderabad. Its authorized share capital is Rs. 5.00 lakhs divided into 50,000 equity shares of Rs. 10.00 each and its issued, subscribed and paid up capital is Rs. 1.00 lakh divided into 10,000 equity shares of Rs. 10.00 each. The objects for which the petitioner company was incorporated is to carry on the business of builders and contractors and to purchase, acquire, take on lease land, buildings and structures for its development and also to build, take on lease, purchase or acquire houses and flats, to let or dispose of the same in installment, hire purchase or by outright sale and to set up orchards, gardens, farms, agricultural houses etc.,

(3.) In the petition filed before this Court, it is stated that prior to its incorporation, the promoters of the petitioner were carrying on business in the name of four different partnership firms viz., M/s Asra Housing, M/s Asra Sheep Farm and Plantations, M/s Asra Hospitals and M/s Asra Textiles, that all the four firms had common partners and were being operated from the same premises. It is stated that, in the course of its business, the partnership firm invited deposits from the public, that several people deposited their money with the firms, that Reserve Bank of India came up with certain guidelines with the avowed object of safeguarding the interest of deposit holders of non-banking finance companies, as several finance companies across the country had defaulted in repaying their deposit holders, resulting in the depositors panicking, that while the petitioner had repaid deposits on maturity till Sept., 1999 other than those unclaimed, the Manager of one of the firms at Gulbarga had, in collusion with her husband, misappropriated the firm's funds and, when disciplinary proceedings were initiated against her, she had lodged a false complaint against the firms on 20.12.1999, on the basis of which investigation was initiated under the A.P. Protection of Depositors of Financial Establishments Act, 1999 and some of the partners were arrested. It is further stated that, during the course of investigation, the police had seized some of the title deeds of the lands purchased by the firms, that the false complaint had resulted in rumours being spread against the firms, that depositors started agitating for repayment of their monies even before the maturity date, that in Jan., 2000 the activities of all the firms were reconstituted into one firm viz, Asra Estates with a view to streamline their operations and derive synergies, that with a view to enlarge the scope of operations of the firm and to protect the interests of the deposit holders the merged firm was registered as a Company under Part IX of the Companies Act under the name of Asra Estates Private Limited and that all the properties of the firm stood vested in the petitioner company. It is stated that the landlady of the premises, where the registered office of the petitioner company was situated, had broken open the locks and had removed all books, records, blank deposit certificates and computers along with the office furniture, that immediately the employees of the petitioner company had lodged complaints with the police at Langer House Police Station and thereby their effort to realize their assets and repay the deposit holders had received a set back, that in the meanwhile some of the depositors had approached the Company Law Board, under Sec. 58-A of the Companies Act, for repayment of the deposits, that on the petitioner furnishing details of the matured and un-matured deposits and proposing a scheme for their repayment, the Company Law Board, by order dated 22.05.2000, had directed the petitioner to sell its assets and repay the deposits and that, in compliance with the orders of the Company Law Board, the petitioner had paid about Rs. 30.00 lakhs to various depositors and had issued several advertisements calling upon the deposit holders to submit applications for repayment of the deposits. According to the petitioner it has assets worth more than Rs. 5.20 crores, in the form of immovable property situated in and around Hyderabad and agricultural lands in Karimnagar and Prakasam Districts, as against its total liabilities of Rs. 3.73 crores payable to deposit holders out of which the company has already re-paid Rs. 30.00 lakhs. It is stated that the company thought it fit to settle all the dues of depositors by way of an one time settlement in terms of a scheme of arrangement, that the Board of Directors of the petitioner company had considered and approved the scheme of arrangement and that C.A. No. 225 of 2003 was filed to convene a meeting of the deposit holders for the purpose of considering and, if thought fit, to approve the proposed scheme of arrangement with or without modification, that by order of this Court dated 07.03.2003 Sri P.V. Markandeyulu, Advocate was appointed as the Chairman for the meeting, that a meeting of the deposit holders was held on 25.04.2003 at 11.00 a.m. which was attended by 67 deposit holders who unanimously approved the proposed scheme of arrangement, that after the Chairman submitted his report the petitioner company sought sanction of the Court to the scheme of arrangement, that, in the meanwhile, some depositors had approached the High Court objecting to the scheme of arrangement and some other deposit holders had proceeded to initiate criminal proceedings, that the Directors of the Company, on perceiving a threat to their lives, went into hiding, and that the petitioner has so far paid a sum of Rs. 96,13,000.00 to various deposit holders disposing of some of the assets. It is stated that the company had adequate assets which was more than sufficient to repay the balance due on deposits of Rs. 2.77 crores, that fresh complaints being lodged by various deposit holders, and continuation of the old cases, had resulted in the petitioner company neither being able to reach a settlement with its depositors nor to revive its operations and, under these circumstances, they thought it appropriate to wind up the company.