PUNJAB AND SIND BANK Vs. DOMINO LEATHERS LTD.

JUDGEMENT

(1.) PUNJAB and Sind Bank has filed this petition for seeking leave of the company court to continue with Civil Suit No. 623 of 2001, for recovery of Rs. 6,82,129 along with interest, pending in the court of Mr. Sudeep Goel, Civil Judge (Junior Division), Chandigarh. Copy of the plaint has been placed on record. The bank instituted suit against M/s. Domino Leathers Ltd., company in liquidation, and its ex -directors in their capacity as guarantors as also the Industrial Development Bank of India (hereinafter referred to as the "IDBI") and Mr. D.P. Ojha, official liquidator, attached to this Court. Notice of the suit was issued to the official liquidator, who seems to have resisted the plea of continuance of the suit in contravention of Section 446 of the Companies Act, 1956 (hereinafter referred to as "the Act"). The bank has, accordingly, approached this Court seeking leave of company court to continue with the suit.

(2.) NOTICE of this petition was issued to the official liquidator who has filed his reply and resisted the petition on the following grounds:

(3.) SUB -section (1) of Section 446 of the Act prohibits institution or commencement of legal proceedings against the company on the passing of the winding up order or the appointment of provisional liquidator and, if any, proceedings were pending on the date of the winding up order, the same cannot be proceeded with against the company except with the leave of the court. Sub -section (2) of Section 446 of the Act, however, empowers the Tribunal (company court) to entertain or dispose of any suit or proceeding by or against the company irrespective of the fact whether such suit or proceeding or claim made on or before of the winding up order.