M/S.Chatura Chit Fund And Finance Private Limited (In Liqn.) vs. Nil

Facts

The Official Liquidator, attached to the High Court of Telangana and Andhra Pradesh, filed a company application under Section 462 of the Companies Act, 1956, and Rules 298 and 306 of the Companies (Court) Rules, 1959. The application sought to take on record the half-yearly accounts of a company in liquidation for the period from April 1, 2024, to September 30, 2024, along with the Independent Auditors' Report dated January 12, 2026. Additionally, the Official Liquidator sought permission to pay an audit fee of Rs. 500/- plus GST to the auditors, M/s. KBS and Associates, Chartered Accountants. The application also requested permission to meet the costs of the application from the company's funds or the Estate and Establishment Fund, subject to reimbursement upon realization of assets.

Held

The Court held that the application was to be allowed. Specifically, it was decided that the half-yearly accounts of the subject company, which is in liquidation, for the period from April 1, 2024, to September 30, 2024, along with the Independent Auditors' Report dated January 12, 2026, submitted on January 22, 2026, by M/s. KBS & Associates, Chartered Accountants, would be taken on record. Furthermore, permission was accorded to the learned Official Liquidator to pay an audit fee of Rs. 500/- plus GST to the auditor. The Court also granted permission to the Official Liquidator to make this payment from the available funds of the company in liquidation, or from the Estate and Establishment Fund account if no funds were available in the company's account, subject to reimbursement from the company's funds upon the realization of its assets. The reasoning was based on the reasons stated in the accompanying affidavit and the consideration of the filed half-yearly accounts.

Key Issues

1. Whether the half-yearly accounts of the company in liquidation for the period 01.04.2024 to 30.09.2024, along with the Independent Auditors' Report dated 12.01.2026, should be taken on record by the Court, as required under Section 462 of the Companies Act, 1956, and Rules 298 and 306 of the Companies (Court) Rules, 1959? 2. Whether permission should be granted to the Official Liquidator to pay an audit fee of Rs. 500/- plus GST to the auditors, M/s. KBS & Associates, Chartered Accountants, as per the terms of engagement and the Companies (Court) Rules, 1959? 3. Whether the Official Liquidator should be permitted to meet the costs of the application from the available funds of the company in liquidation or the Estate and Establishment Fund, subject to reimbursement, as provided under the Companies (Court) Rules, 1959? Contentions: Petitioner (Official Liquidator): Argued for the acceptance of the accounts and report, and for permission to pay the audit fee and application costs, citing the necessity of these actions for the proper winding up of the company. Revenue/State: No arguments were recorded for the revenue or State in the judgment.