In The Matter Of M/S. Vidyut Steels Limited(In Liqn) vs. Nil

Facts

The Official Liquidator, attached to the High Court of Telangana and Andhra Pradesh, filed a Company Application seeking permission to take on record the half-yearly accounts of M/s. Vidyut Steels Limited (in liquidation) for the period from 01.10.2022 to 31.03.2023. The application also requested permission to pay an audit fee of Rs. 5000/- plus GST to the auditors, M/s. Murthy and Kanth, Chartered Accountants, whose report was submitted on 05.06.2025. The Official Liquidator further sought permission to meet the costs of the application from the company's available funds or the Estate and Establishment Fund, subject to reimbursement upon realization of assets. The application was supported by an affidavit dated 16.07.2025.

Held

The Court, having satisfied with the reasons mentioned in the supporting affidavit and considering the half-yearly accounts filed by the Official Liquidator, ordered as follows: (a) The half-yearly accounts of the subject company, which is in liquidation, for the period from 01.10.2022 to 31.03.2023, along with the Auditor's Report dated 10.04.2025 submitted on 05.06.2025 by M/s. Murthy & Kanth, Chartered Accountants, are taken on record. (b) Permission is accorded to the Official Liquidator to pay an audit fee of Rs. 5000/- plus GST to the Auditor. (c) Permission is also accorded to the Official Liquidator to make the said payment from the available funds of the Company (in liquidation), or from the Estate and Establishment Fund account if no fund is available in the Company's account, subject to reimbursement from the funds of the Company (in liquidation) upon realization of assets. The Court found no impediment to granting these permissions based on the provided documentation and arguments.

Key Issues

1. Whether the Court should take on record the half-yearly accounts of M/s. Vidyut Steels Limited (in liquidation) for the period from 01.10.2022 to 31.03.2023, along with the Auditor's Report dated 10.04.2025. The Official Liquidator argued for the acceptance of these accounts and report, as they were duly submitted by the appointed auditors. 2. Whether permission should be granted to the Official Liquidator to pay an audit fee of Rs. 5000/- plus GST to the auditors. The Official Liquidator contended that this payment was necessary for the services rendered by the auditors in examining the company's accounts. 3. Whether the costs of the application should be permitted to be met from the company's funds or the Estate and Establishment Fund, subject to reimbursement. The Official Liquidator argued for this provision to ensure the smooth functioning of the liquidation process, especially if the company's funds were insufficient.