Ol Of The Ahmedabad Jubilee Mills Co. LTD. (In Liqn) vs. Na
Original PDF →Facts
The Official Liquidator (OL) of Ahmedabad Jubilee Mills Co. Ltd. (in liquidation) filed a report seeking permission to release outstanding dues of Rs. 3,40,444/- to a security agency, M/s. USPI Security & Investigation Pvt. Ltd., for the period March 2022 to May 2022. The company was ordered to be wound up in 1989, and the OL has been paying the security agency's bills from the company's funds since 1999. However, the company in liquidation currently has only Rs. 1,10,827/- available. The OL requested permission to make monthly payments from the "Common Pool Account" to the security agency for safeguarding the company's assets, with these payments to be adjusted against future sale realization amounts of the company's properties. The outstanding bills detail charges for security guards deployed, including CGST and SGST.
Held
The Court allowed the Official Liquidator's report in terms of paragraph 6(a). The reasoning was based on the necessity of safeguarding the assets and properties of the company in liquidation, which requires continuous security services. Despite the limited funds available in the company's own account, the Court recognized the importance of maintaining security. Therefore, it permitted the Official Liquidator to utilize funds from the "Common Pool Account" for the outstanding dues of the security agency for the period March 2022 to May 2022. The Court also directed that these payments would be adjusted against the sale realization amount of the properties of the company in liquidation. The operative direction was to allow the report and dispose of it accordingly. No specific GST provisions were discussed in detail, but the total amount included taxes.
Key Issues
1. Whether the Court should permit the Official Liquidator to release outstanding dues of Rs. 3,40,444/- to the security agency for the period March 2022 to May 2022 from the funds available with the Official Liquidator under the head of "Common Pool Account" to safeguard the assets and properties of the Company in liquidation. Petitioner's Arguments: Ms. Bhoomi Thakore, learned counsel for the Official Liquidator, submitted that the company has been ordered to be wound up and the OL appointed as Liquidator. The OL has been paying the security agency's bills from the company's available funds since 1999. Despite the limited funds (Rs. 1,10,827/-) in the company in liquidation, the OL is required to make payments to the security agency for safeguarding the company's assets. She referred to the outstanding bills, totaling Rs. 3,40,444/-, and requested permission to make monthly payments from the "Common Pool Account", to be adjusted against future sale proceeds. Revenue/State's Arguments: No arguments were recorded for the revenue or state in the judgment.
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Cause title — parties, addresses and appearances
ORAL ORDER
Heard Ms. Bhoomi Thakore, learned counsel for Mr. Dhawan M. Jayswal, learned counsel appearing for the applicant- Official Liquidator.
By way of the present Report, the Official Liquidator has prayed for the following reliefs: “(a) In view of the facts stated in para-4 to 5 of this report, this Hon’ble Court may be pleased to permit the Official C/OLR/48/2022 ORDER DATED: 25/07/2022 Liquidator to release outstanding dues of security agency for the period from March, 2022 to May, 2022 total comes to Rs.3,40,444/- (inclusive of all taxes) and also permit the Official Liquidator to make monthly payment towards safeguarding the assets and properties of the Company in liquidation from funds available with the Official Liquidator under the head of “Common Pool A/c” to security agency i.e. M/s. USPI Security & Investigation Pvt. Ltd. and same shall be adjusted against sale realization amount of properties of Company in liquidation. (b). This report is submitted for such other and further orders and directions as may be considered just and appropriate may also be passed in the matter.”
Ms. Thakore, learned counsel submitted that vide order dated 05.09.1989 passed by this Court in Company Petition No. 139 of 1989, the company has been ordered to be wound-up and the Official Liquidator attached to this Court has been appointed as Liquidator of the company. Pursuant to the order dated 10.08.1999, the office of the Official Liquidator is paying the bills of security agency, M/s. USPI Security & Investigation Pvt. Ltd. from the said company’s available fund. However, there is only fund of Rs.1,10,827/- in the said company in liquidation. Ms. Thakore, learned counsel C/OLR/48/2022 ORDER DATED: 25/07/2022 submitted that the Official Liquidator is required to make the payment to the security agency for safeguarding the assets and property of the company in liquidation. The Official Liquidator to make the payment to security agency for the period from March, 2022 to Mary, 2022 from funds available with the Official Liquidator under the head of “Common Pool Account” to security agency and the same shall be adjusted against the sale realization amount of properties of company in liquidation. Ms. Thakore, learned counsel refer to the outstanding bills of security agency as produced at page No.3, which reads thus: SR. NO. BILL NO. & DATE NO. OF SECURITY GUARD DEPLOYED RATE (IN RS.) AMOUNT (IN RS.) 1 0170/2021 Dated 31.03.2022 04 Security Guards 784/- 97216/- 8749.44(+SGST 9%) 8749.44(+CGST 9%) 1,14,715/- 2 0009/2022 Dated 30.04.2022 04 Security Guards 784/- 1,11,014/- (including taxes) 3 0026/2022 Dated 31.05.2022 04 Security Guards 784/- 1,14,715/- (including taxes) Total 3,40,444/- C/OLR/48/2022 ORDER DATED: 25/07/2022
The submissions canvased by Ms. Thakore, learned counsel appearing for the applicant-Official Liquidator requires consideration.
The present Official Liquidator Report stands allowed in terms of Para-6(a). The Report stands disposed of, accordingly. (VAIBHAVI D. NANAVATI,J) Pradhyuman
Reproduced from the public record of the Gujarat High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.