Godavari Plywoods LTD vs. No Respondent

Facts

The Official Liquidator of M/s. Godavari Plywood Ltd. (in liquidation) filed a Company Application seeking permission to take on record a valuation report submitted by M/s. Sundar Associates, Kakinada. The application also sought permission to collect a copy of this report to file an application for the sale of the company's assets, including land (Ac.15.14 cents), buildings, sheds, workers' quarters, plant and machinery, and plantation located at Rampachodavaram, Andhra Pradesh. Furthermore, the Official Liquidator requested permission to pay the valuer's fee from the Estate & Establishment Fund due to the company's lack of funds, and for the costs of the application to be borne by the same fund. The Court had previously appointed M/s. Sundar Associates as the valuer by an order dated 29-07-2022.

Held

The Court held that the valuation report submitted by M/s. Sundar Associates, Kakinada, should be taken on record. The valuer's report indicated a total property value of approximately Rs. 7,10,00,000/-. The Court granted permission to the Official Liquidator to collect a copy of the report from the Registry to enable further steps towards the sale of the company's assets. Consequently, the Official Liquidator was also permitted to file an application for the sale of the identified assets. The Court further directed the Official Liquidator to make the payment for the valuer's services, as per the invoice raised, amounting to Rs. 46,256/- (including GST), from the Estate & Establishment Fund. All other incidental prayers in the application were also granted. The costs of the application were ordered to come out from the Estate & Establishment Fund. The Court expressly did not decide any issues related to GST beyond the inclusion of GST in the valuer's invoice.

Key Issues

1. Whether the valuation report submitted by the appointed valuer should be taken on record, as per Section 457(1)(e) of the Companies Act, 1956, read with Rule 9 of the Companies (Court) Rules, 1959. 2. Whether the Official Liquidator should be permitted to collect a copy of the valuation report to initiate the sale of the company's assets. 3. Whether the Official Liquidator should be permitted to file an application for the sale of the specified assets of the company. 4. Whether the Official Liquidator should be permitted to pay the valuation fee to the valuer from the Estate & Establishment Fund, given the company's financial insolvency. 5. Whether the costs of the application should be paid from the Estate & Establishment Fund. Contentions: Petitioner (Official Liquidator): Argued for the necessity of taking the valuation report on record to proceed with the sale of assets for the benefit of the company's estate. Highlighted the company's lack of funds necessitating the use of the Estate & Establishment Fund for valuer's fees and costs. Relied on Section 457(1)(e) of the Companies Act, 1956, and Rule 9 of the Companies (Court) Rules, 1959. Revenue/State: No arguments were recorded for the Revenue or State in the judgment.