M/S. Cheminnova Remedies PVT.Limited (In Liqn.) vs. No Respondent

Facts

The Official Liquidator, attached to the High Court of Telangana and Andhra Pradesh, filed a Company Application (No. 68 of 2024) under Section 462 of the Companies Act, 1956, read with Rules 298 and 306 of the Companies (Court) Rules, 1959. The application sought to take on record the half-yearly accounts of M/s. Cheminnova Remedies Pvt. Limited (in liquidation) for the period from 01.04.2022 to 30.09.2022, along with the Auditor's Report dated 12.06.2024 submitted by M/s. Padmanabha Rao and Co., Chartered Accountants. The Official Liquidator also prayed for permission to make payment of audit fees, including GST, and other miscellaneous expenses from the company's funds or the Estate and Establishment Fund Account. The application was supported by an affidavit and heard by the High Court.

Held

The Court accepted the prayer of the Official Liquidator. The half-yearly accounts of M/s. Cheminnova Remedies Pvt. Limited (in liquidation) for the period from 01.04.2022 to 30.09.2022, along with the Auditor's Report submitted by M/s. Padmanabha Rao and Co., Chartered Accountants, were taken on file. The Court ordered accordingly, effectively granting the Official Liquidator's request to record these documents. The specific issue of payment of audit fees and other expenses was implicitly approved by the overall acceptance of the application, which included this prayer. The reasoning was based on the perusal of the Auditor's Report with the assistance of the learned counsel for the Official Liquidator. The ratio decidendi is that the High Court, in its winding-up jurisdiction, will facilitate the proper accounting and reporting of companies in liquidation by taking on record the submitted accounts and reports, provided they are in order and presented by the Official Liquidator.

Key Issues

1. Whether the High Court should take on record the half-yearly accounts and the Auditor's Report of the company in liquidation for the period 01.04.2022 to 30.09.2022, as submitted by the Official Liquidator. This issue turns on the procedural requirements under Section 462 of the Companies Act, 1956, and Rules 298 and 306 of the Companies (Court) Rules, 1959. Contentions: Petitioner (Official Liquidator): Argued for the acceptance of the half-yearly accounts and the Auditor's Report, seeking permission for the payment of audit fees and other expenses as per the application. Relied on the provisions of the Companies Act and the Companies (Court) Rules. Revenue/State: No arguments were recorded for the Revenue or State in the judgment.