Full Text
HIGH COURT OF DELHI
Date of Decision: 21st September, 2023
IMAGE CONSUMER MEDIA PVT.LTD ..... Petitioner
Through:
Through: Ms. Sangeeta Chandra, Standing Counsel for OL (M: 9899820000).
JUDGMENT
1. This hearing has been done through hybrid mode. Co. Appl. 691/2023 (under Section 481 of the Companies Act, 1956)
2. This is an application filed by the Official Liquidator seeking dissolution of the Company. Ms. Sangeeta Chandra, ld. Counsel for the Official Liquidator submits that none of the immovable assets of the Company – SPA Luxury Lifestyle Ltd. and its sister concern, Horse Shoe Retail Holding (P) Ltd. were in the name of the Company and the only assets, which the Company owned, were some movable items, which were also sold for a nominal amount.
3. This application has been filed by the Official Liquidator (OL) under Section 481 of the Companies Act, 1956 read with Rule 9 of the Companies (Court) Rules, 1959, praying that Company (in Liqn.) i.e., the Respondent - SPA Luxury Lifestyle Ltd. be dissolved and the OL be discharged from the duties of a liquidator.
4. Vide order dated 4th October, 2018, the OL attached to this Court was appointed as the Provisional Liquidator of the Company, with directions to take charge of all assets, records and books of accounts belonging to the Company (in Liqn.). The citations were published on 4th July, 2019 in the newspapers “Statesman” (English) and “Veer Arjun” (Hindi). Subsequently, vide order dated 2nd December, 2019, the Company (in Liqn.) has been finally wound up. The publication of citation for final winding up of the Company (in Liqn.) has been dispensed with vide order dated 13th July, 2023 in CA No. 303/2023.
5. It is stated in the application that as per the records of the Company (in Liqn.) kept at the office of the Registrar of Companies, Delhi and Haryana (ROC) and Master Data available on MCA portal, there were two Directors namely, Mr. Narendra Singh Bisht and Mr. Rajpal Singh Bisht. Both the Directors have filed their statement under Rule 130 and Statement of Affairs (SOA) has been filed only by Mr. Narendra Singh Bisht on 10th May, 2019.
6. The registered office of the Company (in Liqn.) was at 2822/18, Bedanpura, Karol Bagh, New Delhi-110005. The same could not sealed by the team from the office of the OL on its visit to the registered office on 12th January, 2019, for taking over the possession of assets and records/books of accounts, as the team was informed that the registered office was never let out/sold to the Company or its Directors; that there was an existing Sale Deed which was shown to the team and the team did not find any sign board of the Company (in Liqn.) at the site.
7. The application points out that vide letter dated 21st February, 2019 received from Mr. Narendra Singh Bisht, Ex-Director it was informed that inventories/moveable assets (branded crockery items) of the Company (in Liqn.) as well as its sister concern namely, Horse Shoe Retail Holding Pvt. Ltd. were lying at Room No. 01, First Floor, Khasra No 504, next to NDMC Girls School Rajokri, New Delhi-110038.
8. The team from the office of the OL visited the said address on 22nd February, 2019. After taking photographs of the premises and preparing a list of inventory of articles lying therein along with a video of the inventory lying, the team sealed the main gate along with the lift which was installed adjacent to the room/hall where the inventory/moveable assets were kept.
9. The Court vide order dated 21st May, 2019 appointed Mr. Ankit Goel as the valuer for valuation of the moveable assets of the Company (in Liqn.) and its sister concern. The Valuation Report was submitted on 16th August, 2019 in a sealed cover. In terms of the permission granted vide order dated 02.12.2019 a combined Sale Notice for the said moveable assets was published in the newspapers on 27th January, 2020 and 28th January, 2020 respectively. Despite five prospective buyers having visited for inspection, no bids were received.
10. It is stated that while allowing CA No. 227/2022, permission was granted to appoint a fresh Valuer to revalue the moveable assets of the Company (in Liqn.). The goods were revalued and a combined hand bill for their auction was published to reduce the publication expense. Despite the moveable assets being put up for auction on three occasions by uploading the handbill on three websites, no bids were received. Vide order dated 1st June, 2022, this Court granted liberty to the OL to further reduce the reserve price at its discretion as no buyer could be found despite the moveable assets being put up for auction on three occasions.
11. It is stated in the application that although, no bids were received for the moveable assets in question, on the basis of the reserve price fixed, two offers were subsequently received by the office of the OL from interested buyers. After some deliberations, a decision was taken to sell the movable assets to the higher bidder amongst the two bidders mentioned and accept the bid of R.S. Traders at their quoted price of Rs. 1 Lakh.
12. It is specifically pointed out that despite the bid offer being below the reserve price, since numerous efforts had already been made by the office to sell the moveable assets without any result and also, since the landlord of the premises wherein, the moveable assets of the Company (in Liqn.) were lying, was pressing for forthwith resumption of the premises, the acceptance of the bid of R.S. Traders was viewed as the most prudent option in the circumstances.
13. In terms of the permission granted by this Hon'ble Court in C.A. NO. 546/2022, the offer of RS Traders was accepted and the possession of moveable assets was handed over to the Auction Purchaser on 22nd September, 2022. After removal of all the moveable assets, the vacant possession of Shop Nos. 2, 3 and 8, Khasra No. 509/1, Next to NDMC Girls School, Rajokri, New Delhi (where the moveable goods had been shifted from Room No. 1, First Floor, Khasra No. 504, next to NDMC Girls School Rajokri, New Delhi) was handed over to the landlord/owner on the same day.
14. Subsequently, vide letter dated 2nd November, 2022, the Petitioner was informed by the OL that the Company neither had any assets nor sufficient funds for inviting claims from the creditors and was in the process of dissolving the Company (in Liqn.).
15. It is also stated that as there are no other moveable/immoveable or other assets in the possession of the OL for realization in the interest of the creditors, no claims have been invited by this office.
16. This Court is of the view that no fruitful purpose shall be served in keeping the winding up proceedings alive for the present Company (in Liqn.) and this is a fit case for dissolution of the Company (in Liqn.) under Section 481 of the Companies Act, 1956. The Official Liquidator may also be discharged from the duties of Liquidator of the Company (in Liqn.).
17. It is pointed out ld. Counsel for the OL that no Criminal Complaint under Section 454 (5) of the Companies Act, 1956 was filed against the Ex- Directors of the Company (in Liqn.).
18. The Hon'ble Supreme Court in Meghal Homes (P) Ltd. V. Shree Niwas Ginni K.K. Samiti & Ors. (2007) 7 SCC 753, has held as follows: “When the affairs of the Company had been completely wound up or the court finds that the Official Liquidator cannot proceed with the winding up of the Company for want of funds or for any other reason, the court can make an order dissolving the Company from the date of that order. This puts an end to the winding-up”
19. It is further submitted that keeping the winding up proceedings pending would only result in unnecessarily keeping a defunct Company on the rolls of the Registrar of Companies and it would also result in incurring establishment and legal expenses of liquidation proceedings.
20. In view of the above decision of the Hon'ble Supreme Court and the facts and circumstances of this case, the liquidation proceedings deserve to be brought to an end. Consequently, Company (in Liqn.) - SPA Luxury Lifestyle Ltd. is hereby ordered to be dissolved.
21. The application under Section 481 of the Companies Act, 1956 filed by the Official Liquidator is allowed in the above mentioned terms. CO. Pet. 439/2016
22. The Official Liquidator is permitted to close the books of account of the Company. A copy of this order be communicated to the Registrar of Companies within thirty days by the Official Liquidator.
23. A copy of this order be communicated by OL to the Registrar of Companies within thirty days of its release and the Official Liquidator is discharged.
24. The Petitioner is at liberty to avail of its remedies in case, the whereabouts of the Ex-Directors are found out. It is also clarified that the Petitioner is not precluded from instituting any criminal proceedings against the Ex-Directors of the Company (in Liqn.) as it is prima facie, apparent that they have used the corporate façade of the Petitioner for transactions entered into by them and have failed to discharge their liability. I.A. 466/2022 ( for directions)
25. This is an application which was filed by Mr. Satya Narain Yadav seeking removal of the goods and handing over of the premises i.e., Shop No. 2,[3] and 8 in Khasra no. 509/1, Next to NDMC Girls School, Rajokari, New Delhi.
26. Ld. Counsel for the OL, Ms. Chandra submits that the goods have been removed and possession has been handed over to the owner.
27. In view of the statement of the ld. Counsel for the OL and the order passed above in application CO.APPL. 691/2023, the present application is infructuous and is accordingly disposed of.
PRATHIBA M. SINGH JUDGE SEPTEMBER 21, 2023/mr/sk