BHARAT TRADERS LTD Vs. S SADHU SINGH

JUDGEMENT

(1.) MESSRS. Bharat Traders Limited have gone into voluntary liquidation with effect from 26th of March, 1959. The present application was filed by the voluntary liquidator against Sadhu Singh respondent alleging that Sadhu Singh was appointed as the chief agent by the board of directors whose main duties were to sell the shares of the company and invest funds in the purchase of the goods of the kind in which the company was trading, namely, cycles, sewing machines, radio, etc. , on hire-purchase system. The chief agent was also under contract to contribute himself to the funds of the company on certain basis ; that the respondent was appointed as a chief agent in 1951, for the area of Phagwara extending up to Hoshiarpur ; and that in furtherance of his appointment and the terms of contract between the company and the respondent, the respondent carried on the work of the chief agent and contributed Rs. 11,000 up to the end of February, 1954, towards the business of the company. The chief agent was to be supplied with receipt books for issuing provisional receipts to the customers which he used to send to the company together with the amount realised. Subsequently, he failed to send the money to the company ; and thereafter a resolution dated 18th of May, 1955, was passed in a meeting of the board of directors of the company, presided over by the respondent himself, wherein it was resolved that " Sadhu Singh shall withdraw such an amount from the company's assets of his unit at Phagwara that his balance remains to the extent of Rs. 5,000 with the company". He did not do so and continued to accumulate with himself the money due to the company. The company was wound up and he was asked to render accounts to the voluntary liquidator and hence this application was made by the voluntary liquidator on 24th of September, 1964.

(2.) THIS application was resisted by Sadhu Singh. The company was asked to put in their revised claim, which was done and the following issues were settled-1. Is the claim of the liquidator barred by time ? 2. If not, what is the amount due from the respondent to the company (in liquidation) ?

(3.) WITH regard to issue No. 2, as agreed to by the parties, Mr. A. D. Kapur, a chartered accountant of Jullundur, was appointed as a local commissioner to go into the accounts and furnish a report as to how much amount was due from the respondent to the company. The report was received, on which objections were filed on behalf of the company. According to the report, on behalf of the company, a local claim of Rs. 6,249. 61 paise was put in against Sadhu Singh. As reported by the local commissioner, Rs. 1,249. 61 paise was ' the total amount claimed in addition to Rs. 5,000, which were claimed as payable to Sirsa head office according to the resolution passed by the board of directors on 18th of May, 1955, referred to above, that is, a total amount of Rs. 6,249. 61 paise. The question whether a sum of Rs. 5,000 was due to the company or not was left open to be decided by the court. With regard to remaining Rs. 1,249. 61 paise, it was stated by the local commissioner that this amount consists of various items mentioned in the claim and the same were accepted as correct. Again it was agreed between the parties that the company did not hold any claim of Rs. 898. 08 paise ; thus leaving a balance of Rs. 351. 53 paise only which the respondent has to pay to the company.