M/S.Krishi Engines Limited(In Liqn) vs. No Respondent

Facts

The Official Liquidator, attached to the High Court for the State of Telangana and Andhra Pradesh, filed a Company Application (No. 69 of 2025) 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 M/s. Krishi Engines Limited (in liquidation) for the period from October 1, 2022, to March 31, 2023. It also requested permission to pay an audit fee of Rs. 500/- plus GST to the independent auditors, M/s. Padmanabha Rao and Co., Chartered Accountants, whose report was dated December 13, 2024, and submitted on December 16, 2024. The Official Liquidator also sought permission to meet the costs of the application from the company's available funds or the Estate and Establishment Fund.

Held

The Court held that the application was to be allowed. It perused the auditors' report dated December 13, 2024, with the assistance of the counsel for the Official Liquidator and was satisfied with it. Consequently, the Court ordered that the half-yearly accounts of the subject company for the period from October 1, 2022, to March 31, 2023, along with the auditors' report, be taken on record. Permission was accorded to the Official Liquidator to make the payment of the audit fee of Rs. 500/- plus GST to the auditor. The cost of the application was to be met from the available funds of the company in liquidation. The Court also noted that there would be no order as to costs and that any pending miscellaneous petitions in the Company Application would stand closed. The ratio of this decision is that when an Official Liquidator properly presents accounts and auditor's reports for a company in liquidation, and the auditor's report is satisfactory, the High Court will grant permission for these accounts to be taken on record and for necessary payments like audit fees to be made.

Key Issues

1. Whether the Court should take on record the half-yearly accounts of the company in liquidation for the period from 01.10.2022 to 31.03.2023, along with the Independent Auditors' Report, as required under Section 462 of the Companies Act, 1956, read with Rules 298 and 306 of the Companies (Court) Rules, 1959? The Petitioner (Official Liquidator) argued that the application was filed in compliance with the relevant provisions of the Companies Act and Rules, seeking approval for the accounts and audit fee payment. The Petitioner relied on the submitted auditors' report and sought permission to disburse the audit fee and application costs. The Revenue or State did not present any arguments as this was an application by the Official Liquidator for administrative and financial approval concerning a company in liquidation.