M/S. Vijetha Agro Farms (I) LTD. vs. Nil
Held
The Court ratified the action taken by the Official Liquidator in appointing a Security Service Agency to safeguard the property of the company in liquidation. The Court also permitted the Official Liquidator to pay the watch and ward salaries at the rate of Rs. 5000/- per month per guard, plus GST thereon, with effect from January 7, 2022. This payment is to be made from the funds of the Estate and Establishment fund account and is to be recouped upon the sale of the assets of the company. The reasoning is that the property of the company in liquidation is being safeguarded. The Company Application was allowed accordingly. No issue was expressly left undecided.
Facts
The Official Liquidator (OL) took possession of a property belonging to a company in liquidation on January 7, 2022, after it was released from the custody of the CBCID. To safeguard the property, the OL appointed a Security Agency. The present application was filed by the OL to seek ratification of this appointment and permission to pay watch and ward salaries at a rate of Rs. 5000/- per month per guard, effective from January 7, 2022. The property was previously occupied by a sister concern and its possession was delayed due to its custody with the CBCID.
Key Issues
1. Whether the action of the Official Liquidator in appointing a Security Service Agency to safeguard the property of the company in liquidation is liable to be ratified? 2. Whether the Official Liquidator should be permitted to pay watch and ward salaries at the rate of Rs. 5000/- per month per guard, plus GST thereon, with effect from January 7, 2022, from the Estate and Establishment fund account? Petitioner's Arguments (Official Liquidator): The Official Liquidator argued that the appointment of a security agency was necessary to safeguard the property of the company in liquidation after taking possession. The payment of salaries, including GST, was essential for maintaining the security of the asset. The OL sought ratification of these actions and permission for payment from the company's funds, to be recouped upon sale of assets. Revenue/State's Arguments: The judgment does not record any specific arguments from the revenue or state in opposition to the Official Liquidator's application.
AI-generated summary — verify with the full judgment below
HON’BLE SRI JUSTICE R. RAGHUNANDAN RAO
COMPANY APPLICATION. No. 13 of 2022 ORDER:
The company in liquidation has a property situated at Agathavarappadu Village, Mangalagiri Road, Guntur District, which was in occupation of a sister concern. The possession of this property could not be taken by the Official Liquidator earlier as it was in the custody of the CBCID. Subsequently, the Inspector of Police, CID, RO, Guntur had forwarded a letter dated 20.12.2021 to the Official Liquidator that they are ready to handover the said property. Thereafter, the office of the Official Liquidator has taken possession of this property on 07.01.2022 from the Inspector of Police, CID, RO, Guntur District. In order to safeguard the said property the Official Liquidator had appointed a Security Agency to safeguard the said property.
The present application has been filed to ratify the action taken by the Official Liquidator in appointing a Security Service Agency and permit the Official Liquidator to pay the watch & ward salaries at the rate of Rs.5000/- per month per guard with effect from 07.01.2022. 2
As the property of the company in liquidation is saf
The judgment continues below.
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