| Content Provider | Supreme Court of India |
|---|---|
| e-ISSN | 30484839 |
| Language | English |
| Access Restriction | NDLI |
| Subject Keyword | 99 advertisement Companies Act 1956: ss. 293 24 and 101 – Winding up petitions Company (Court) Rules 1959: rr.96 531 |
| Content Type | Text |
| Resource Type | Law Judgement |
| Jurisdiction | India |
| Act(s) Referred | Companies Act, 2013 (18 of 2013) |
| Case(s) Referred | Referred Case 0 Referred Case 1 |
| Case Type | Special Leave Petition |
| Court | Supreme Court of India |
| Disposal Nature | Petition Dismissed |
| Headnote | Company (Court) Rules, 1959: rr.96, 99, 24 and 101 – Winding up petitions, advertisement – Mandatory requirement – Held: The advertisement of a winding up petition is mandatory – However, if the petitioning creditor fails to advertise the petition within the prescribed time, r.101 accords discretion to the court to substitute such petitioning creditor with another creditor or contributory, if latter is capable and desirous of prosecuting the winding up petition – In the instant case, no such advertisement was made – No other creditor or contributory expressed willingness to prosecute the original winding up petition – At the same time, as noted by the Division Bench of High Court, there were other unsatisfied secured creditors of KOFL who were not given the option to step into the shoes of the petitioning creditor in terms of r.101 – Given the absence of a specific provision mandating that the petition only be advertised by petitioning creditor, the Company Court has the discretion to direct the publishing of an advertisement to secure the interest of other creditors – In such situations, the winding up proceedings cannot be dismissed, as it would frustrate the very objective of securing the interest of all creditors – Clearly, the submission for the Petitioner that the winding up petition deserves to be dismissed as all creditors of KOFL have been satisfied is belied by the existence of the proceedings before the DRT – The records showed that the settlement of dues was only with respect to the unsecured creditors of KOFL, which was carried out pursuant to the orders issued by the Company Judge – Therefore, given that the secured creditors of KOFL have still not been satisfied and are bound to be affected by any order dismissing the winding up proceeding, the Company Court is directed to issue appropriate directions to the Official Liquidator for publishing the advertisement of the proceedings in accordance with law.Companies Act, 1956: ss.293, 531 – Whether the agreement to sell executed by KOFL in favour of petitioner amounted to fraudulent preference and consequently whether the petitioner has a right to seek the execution of sale deed in its favour – Held: s.531 is a provision that deals with the effect of winding up of a company on its antecedent transactions – It provides that a transfer or any other act done in relation to the property of a company within a period of six months before the commencement of its winding up (“twilight period”) shall be deemed to be a fraudulent preference of its creditors and accordingly be invalid – In the instant case, s.531 should be read in conjunction with s.293, which stipulates that the sale of the whole, or substantially the whole of the property of a public company requires the consent of its general meeting – s.531 provides that any act relating to the property of a company may qualify as a fraudulent preference if two conditions are met – First, the dominant motive in the mind of the company (as represented by its directors or general body of shareholders) should be to prefer a particular creditor – Second, the said act must be undertaken during the period of six months preceding the filing of the winding up petition of the company – While the first requirement ensures that the dominant intention to defraud creditors is detected, the second ensures that there is a level of commercial certainty and finality of transactions for those interacting with the company – s.293(1) requires the consent of the general meeting of a company in case of a sale or disposition of the whole or substantial whole of its property – s.293(1) is applicable to the instant case in view of the categorical finding by both the Courts below that the subject property is the only immovable property of KOFL – Notably, no approval from the general meeting of KOFL was obtained – There was only a Board resolution permitting Respondent No.1 to execute agreements of sale and other documents for the purpose of selling the subject property – In the absence of the requisite approval from the general meeting, the instant application for execution of a sale deed cannot be allowed as doing so would be allowing the Petitioner to sidestep the mandatory requirements of s.293(1) – A bare reading of s.531 shows that in addition to any transfer of property, it covers “any other act relating to the property” – These terms indicate that s.531 is comprehensive and includes indirect transactions within its scope – The Petitioner is not precluded from benefiting from s.531 on account of non-fulfilment of the six-month condition – Therefore, the agreement to sell cannot be termed as a fraudulent preference under s.531. Transfer of property: It is well-settled that the sale of an immovable property can only be effectuated through a sale deed and an agreement to sell does not transfer any right, title or interest in the immovable property. |
| Judge | Hon'ble Mr. Justice Mohan M. Shantanagoudar |
| Neutral Citation | 2019 INSC 1156 |
| Petitioner | Idbi Bank Limited Through Dgm (legal) |
| Respondent | The Official Liquidator, Office Of The Official Liquidator Of Companies & Anr. |
| SCR | [2019] 15 S.C.R. 549 |
| Judgement Date | 2019-10-17 |
| Case Number | 33825 |
National Digital Library of India (NDLI) is a virtual repository of learning resources which is not just a repository with search/browse facilities but provides a host of services for the learner community. It is sponsored and mentored by Ministry of Education, Government of India, through its National Mission on Education through Information and Communication Technology (NMEICT). Filtered and federated searching is employed to facilitate focused searching so that learners can find the right resource with least effort and in minimum time. NDLI provides user group-specific services such as Examination Preparatory for School and College students and job aspirants. Services for Researchers and general learners are also provided. NDLI is designed to hold content of any language and provides interface support for 10 most widely used Indian languages. It is built to provide support for all academic levels including researchers and life-long learners, all disciplines, all popular forms of access devices and differently-abled learners. It is designed to enable people to learn and prepare from best practices from all over the world and to facilitate researchers to perform inter-linked exploration from multiple sources. It is developed, operated and maintained from Indian Institute of Technology Kharagpur.
Learn more about this project from here.
NDLI is a conglomeration of freely available or institutionally contributed or donated or publisher managed contents. Almost all these contents are hosted and accessed from respective sources. The responsibility for authenticity, relevance, completeness, accuracy, reliability and suitability of these contents rests with the respective organization and NDLI has no responsibility or liability for these. Every effort is made to keep the NDLI portal up and running smoothly unless there are some unavoidable technical issues.
Ministry of Education, through its National Mission on Education through Information and Communication Technology (NMEICT), has sponsored and funded the National Digital Library of India (NDLI) project.
| Sl. | Authority | Responsibilities | Communication Details |
|---|---|---|---|
| 1 | Ministry of Education (GoI), Department of Higher Education |
Sanctioning Authority | https://www.education.gov.in/ict-initiatives |
| 2 | Indian Institute of Technology Kharagpur | Host Institute of the Project: The host institute of the project is responsible for providing infrastructure support and hosting the project | https://www.iitkgp.ac.in |
| 3 | National Digital Library of India Office, Indian Institute of Technology Kharagpur | The administrative and infrastructural headquarters of the project | Dr. B. Sutradhar bsutra@ndl.gov.in |
| 4 | Project PI / Joint PI | Principal Investigator and Joint Principal Investigators of the project |
Dr. B. Sutradhar bsutra@ndl.gov.in Prof. Saswat Chakrabarti will be added soon |
| 5 | Website/Portal (Helpdesk) | Queries regarding NDLI and its services | support@ndl.gov.in |
| 6 | Contents and Copyright Issues | Queries related to content curation and copyright issues | content@ndl.gov.in |
| 7 | National Digital Library of India Club (NDLI Club) | Queries related to NDLI Club formation, support, user awareness program, seminar/symposium, collaboration, social media, promotion, and outreach | clubsupport@ndl.gov.in |
| 8 | Digital Preservation Centre (DPC) | Assistance with digitizing and archiving copyright-free printed books | dpc@ndl.gov.in |
| 9 | IDR Setup or Support | Queries related to establishment and support of Institutional Digital Repository (IDR) and IDR workshops | idr@ndl.gov.in |