M/S. Rama Krishna Equity Funds LTD vs. Nil

Facts

The Official Liquidator, attached to the High Court of Telangana and Andhra Pradesh, filed Company Application No. 131 of 2025 in Company Petition No. 52 of 1997. The application, filed under Section 462 of the Companies Act, 1956, sought permission to take on record the half-yearly accounts of M/s. Rama Krishna Equity Funds Ltd. (in liquidation) for the period 01.10.2022 to 31.03.2023, along with the Auditor's Report dated 10.04.2025. Additionally, the Official Liquidator requested permission to pay an audit fee of Rs. 500/- plus GST to the auditors, M/s. Murthy & Kanth, Chartered Accountants. The application also sought permission to meet the costs of the application from the company's funds or the Estate and Establishment Fund, subject to reimbursement.

Held

The Court, having been satisfied with the reasons mentioned in the supporting affidavit and upon considering the half-yearly accounts filed by the learned Official Liquidator, ordered the application. The Court took on record the half-yearly accounts of M/s. Rama Krishna Equity Funds Ltd. (in liquidation) for the period from 01.10.2022 to 31.03.2023, along with the Auditor's Report dated 10.04.2025. Furthermore, permission was accorded to the 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 realization of its assets. The costs of the application were implicitly permitted to be met as per the order regarding payment of audit fees and from available funds.

Key Issues

1. Whether the Court should take on record the half-yearly accounts of the company in liquidation for the period 01.10.2022 to 31.03.2023, along with the Auditor's Report dated 10.04.2025, as submitted by the Official Liquidator. The Official Liquidator argued that these documents are necessary for the proper administration of the liquidation process and to provide a clear financial picture of the company. 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. Murthy & Kanth, Chartered Accountants. The Official Liquidator contended that this fee is a legitimate expense incurred for auditing the company's accounts, which is essential for the liquidation proceedings. 3. Whether the costs associated with the Company Application itself should be permitted to be met from the available funds of the company in liquidation or the Estate and Establishment Fund, subject to reimbursement. The Official Liquidator argued that these costs are incidental to the liquidation process and should be borne by the company's estate.