[Cites 9, Cited by 0]
Calcutta High Court
Nomura Investment And Finance Private ... vs Official Liquidator on 25 March, 2026
Author: Supratim Bhattacharya
Bench: Sabyasachi Bhattacharyya, Supratim Bhattacharya
OD-3
ORDER SHEET
IN THE HIGH COURT AT CALCUTTA
Civil Appellate Jurisdiction
ORIGINAL SIDE
APO/1/2026
WITH
CP/117/1979
IA NO: ACO/2/2026
NOMURA INVESTMENT AND FINANCE PRIVATE LIMITED
VS
OFFICIAL LIQUIDATOR
BEFORE:
The Hon'ble JUSTICE SABYASACHI BHATTACHARYYA
And
The Hon'ble JUSTICE SUPRATIM BHATTACHARYA
Date : March 25, 2026.
Appearance:
Mr. Siddhartha Mitra, Sr. Adv.
Ms. Gargi Goswami, Adv.
Ms. Antara Biswas, Adv.
..for the appellant
Mr. Abhijeet Chatterjee, Sr. Adv.
Mr. Rajratna Sen, Adv.
Mr. Rudradev Chowdhury, Adv.
Ms. Akanksha Mukherjee, Adv.
Ms. Sudrani Mukherjee, Adv.
..for Mr. Arun Kumar Agarwal, Adv.
Mr. Swatarup Banerjee, Adv.
Mr. Shaunak Ghosh, Adv.
Mr. Sariful Haque, Adv.
Mr. Rajib Mullick, Adv.
Mr. Biswaroop Ghosh, Adv.
..for Mr. Kailash Agarwala
Mr. Debnath Ghosh, Sr. Adv.
Mr. Manoj Kumar Tiwari, Adv.
Mr. Sarosij Dasgupta, Adv.
Mr. Biswaroop Mukherjee, Adv.
Ms. Arpita Dey, Adv.
..for Manish Kumar Agarwala
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Mr. Subhankar Nag, Adv.
Mr. Avishek Guha, Adv.
Ms. Sonal Agarwal, Adv.
Mr. Ankush Majumdar, Adv.
..for Sanjay Agarwala
Mr. Debashis Saha, Adv.
Mr. Avirup Roy Sanyal, Adv.
Ms. Sucheta Pal, Adv.
Mr. Jyotishman Sarkar, Adv.
..for SBI
Mr. Anirban Kar, Adv.
Mr. Munshi Ashiq Elahi, Adv.
Mr. Rohit Mahato, Adv.
..for Special Officer
1. The Court: The matter is taken up on urgent basis on being
mentioned by the appellant in APOT/304/2025, namely one Nomura
Investment and Finance Private Limited, for the purpose of adjudication on
the prayer of the appellant for stay of operation of the judgment impugned
in the appeal, dated November 20, 2025, deciding several applications in
connection with a company petition.
2. The plinth of the challenge, as it transpires upon hearing learned
senior counsel and learned counsel appearing for the parties, is that the
learned Single Judge, in the capacity of a Company Court, did not have the
jurisdiction to pass the impugned order, in view of the specific provisions of
Section 434 of the Companies Act, 2013 mandating transfer of all such
proceedings pertaining to winding up of companies to the National
Company Law Tribunal (NCLT).
3. Secondly, it is contended that the challenge preferred before the
learned Single Judge was taken out after a period of more than three
decades from the winding up order, which was affirmed by a Division
Bench of this Court. It is argued that in the appeal preferred against the
winding up order dated November 5, 1979, several observations were made
3
against the erstwhile management of the company (in liquidation). It is
contended that, by its order dated April 21, 1983, the Division Bench
dismissed the appeal and confirmed the order of winding up.
4. Thus, it is argued that the learned Single Judge, as a Company Court,
did not have the jurisdiction to reverse the winding up order, thereby
traversing the specific findings and conclusions of the Division Bench in
appeal.
5. It is further contended on behalf of the appellant that in view of the
operation of the Insolvency and Bankruptcy Code, 2016 (IBC), the
liquidation proceedings in respect of the company (in liquidation) are
governed by the said Statute and it is beyond the jurisdiction of the
Company Court, which operated under the provisions of the Companies
Act, 1956 (now, Companies Act, 2013) to pass any order in the nature of
the impugned judgment.
6. The said contentions are refuted by the respondents primarily on the
premise that in view of the palpable fraudulent actions of Mr. Arun Kumar
Agarwal, one of the Special Officers who was appointed by an order dated
December 12, 1991 in the liquidation proceedings, which indicated that he
acted solely in his own interest to siphon off the assets of the company (in
liquidation) and become the majority shareholder having controlling
interest in the said company, the interference by the learned Single Judge
was justified. Moreover, it is contended that fraud vitiates all and the
Company Court had ample power to undo whatever wrong was done under
the aegis of a company petition.
7. It is also contended, by placing reliance on certain documents which,
although not a part of the present application, are a part of the records in
the main appeal, that there were several communications and
correspondence issued by the said Mr. Arun Kumar Agarwal, which clearly
go on to show that the said Special Officer abused his office as a Special
Officer and as such, the acts done with the blessings of the orders of this
Court appointing such Special Officer ought to have been undone.
8. By placing reliance on the provisions of the Companies Act, 1956, in
particular Sections 456 and Section 460(6) thereof, it is argued by the
respondents that the Company Court has ample jurisdiction to reverse or
modify the act or decision done or taken by a Liquidator, if the Court finds
it just in the circumstances. In the present case, it is pointed out, the
function of the Official Liquidator was virtually delegated to the two Special
Officers appointed by the Company Court vide order dated December 12,
1991. As such, any acts contrary to the law and against the interest of the
company (in liquidation) committed by them come within the purview of
acts which are amenable to the jurisdiction of the Company Court under
Section 460(2) of the 1956 Act.
9. It is further argued that under Section 456 of the 1956 Act, all the
property and effects of the company (in liquidation) shall be deemed to be
in the custody of the Court as from the date of the order for the winding up
of the company.
10. At this point, we make it clear that the arguments advanced by the
parties were elaborate and only the crux of such arguments are being
narrated here, in order to avoid unnecessary surplusage in the present
order, which is confined to a consideration of an ad interim prayer for stay,
particularly since the matter has been assigned to this Bench for a limited
period and the main appeal is pending for adjudication before the regular
Bench, where all the issues involved are under consideration.
11. Upon hearing learned counsel for the contesting parties, the Court
comes to the following conclusions:
12. Insofar as the question of jurisdiction is concerned, it was held in
Action Ispat and Power Private Limited vs. Shyam Metalics and Energy
Limited, reported at (2021)2 SCC 641, which is relied on by both sides, that
given the scheme of winding up under Chapter XX of the Companies Act,
2013, it is clear that several stages are contemplated, with the Tribunal
retaining the power to control the proceedings in a winding up petition
even after it is admitted. A distinction was drawn by the Hon'ble Supreme
Court in the said judgment between the stage prior to admission of a
winding up proceeding and the post-admission stage. Regarding the latter,
it was observed that post admission of an winding up petition and after the
assets of the company sought to be wound up become in custodia legis and
are taken over by the Company Liquidator, Section 290 of the Companies
Act, 2013 would indicate that the Company Liquidator may carry on the
business of the Company so far as may be necessary for the beneficial
winding up of the company and may even sell the company as a going
concern. So long as no actual sales of the movable and/or immovable
property have taken place, nothing irreversible is done which would
warrant a company Court staying its hands on a transfer application made
to it by a creditor or any party to the proceedings. It was further stressed
by the Hon'ble Supreme Court that it is only where the winding up
proceedings have reached a stage where it would be irreversible, making it
impossible to set the clock back, that the Company Court must proceed
with the winding up, instead of transferring the proceedings to the NCLT to
now be decided in accordance with the provisions of the Code (IBC).
13. In the present case, it is evident that subsequent to the winding up
order dated November 5, 1979, as affirmed by the Appellate Bench on April
21, 1983, the parties concerned agreed to the winding up order dated
November 5, 1979 and all proceedings thereunder to be stayed until
further orders of the Court.
14. Thus, the argument that the winding up order comes in the way of
preferring a challenge before the Company Court and/or of the learned
Single Judge, in the impugned order, having overridden the winding up
order becomes rather academic.
15. Since the order dated December 12, 1991, passed on consent,
categorically stayed all further proceeding in connection with the winding
up order as well as the order itself, the said argument cannot be raised as
a bogey to interdict the jurisdiction of the Company Court to look into the
propriety of such order.
That apart, we cannot but take notice of the fact that by dint of the said
order dated December 12, 1991 and the consequential further orders dated
June 11, 1993, June 18, 1993 and June 28, 1993, the Special Officers,
who were virtually clothed with the powers of the Official Liquidator, were
given the right to supervise the functioning of a Board of Management
which was directed to be formed to deal with the affairs of the company (in
liquidation). The Official Liquidator was even directed to hand over books,
records and papers of the company to such Board of Management, thereby
denuding the Official Liquidator of his statutory obligations as mandated
under the scheme of the 1956 Act.
Under Section 456 of the said Act, all the property and effects of the
company are deemed to be in the custody of the Court as from the date of
the order of the winding up of the company. Section 457, on the other
hand, provides that the Liquidator in a winding up by the Court shall have
power, with the sanction of the Court, to represent the company (in
liquidation) in various capacities.
16. Even otherwise, Section 460 of the 1956 Act confers the Court with
the power to confirm, to reverse or modify any act or decision taken by the
Liquidator, if the Court thinks it fit and just in the circumstances.
17. Thus, the eco-system contemplated within the scheme of the 1956 Act
envisages that upon winding up, the property of the Company (in
liquidation) shall be protected, along with the interests of its shareholders
and other interested parties, by the legal fiction that the property will vest
in the Court, which is to exercise its powers vis-à-vis the assets of the
company through the Official Liquidator.
18. It is evident, at least prima facie, that by the order dated December 12,
1991, the said eco-system was obviated by handing over the powers of the
Official Liquidator and, in a sense, the control of the Court, to the
discretion of two Special Officers who were, in turn, permitted to act
through a Board of Management constituted by subsequent orders.
19. The premise of the application before the learned Single Judge in the
present case was that there was egregious misappropriation of the assets
and funds of the company under the aegis of the Special Officers,
particularly at the behest of Mr. Arun Kumar Agarwal, one of the Special
Officers. The winding up petition having already culminated in a final order
of winding up, the matter had already reached an irreversible stage within
the contemplation of Action Ispat (supra). Thus, it was the Company Court
which retained jurisdiction, more so in the context of its powers under
Section 460 of the 1956 Act.
20. Thus, in the circumstances of the present case, there was no manner
of jurisdiction vested in the NCLT to take up such proceeding.
21. In the event a winding up proceeding does not reach an irreversible
stage, the NCLT retains jurisdiction. However, in the present case, the
winding up petition not only reached an advanced stage, but had already
culminated in an order of winding up, which was virtually undone by the
order dated December 12, 1991 and by the subsequent orders passed by
the Company Court.
22. Moreover, at no point of time did any of the concerned parties raise
any objection to the exercise of jurisdiction by the Company Court in
passing such post winding up orders. Thus, it cannot be said that in the
present case, applying the ratio laid down in Action Ispat (Supra), the
learned Single Judge was mandated in law to transfer the matter to the
NCLT.
23. Hence, prima facie, the objection as to jurisdiction of the learned
Single Judge cannot be accepted.
24. Insofar as the allegation of long delay is concerned, it prima facie
appears that there was no direct proof of knowledge of the Directors or the
erstwhile management of the company about the winding up proceeding or
the winding up order. Although, under normal circumstances, it would be
rather absurd to hold that the management, who were removed by several
orders in an winding up proceeding, did not have any knowledge thereof at
all, in the present case, there are categorical findings of the learned Single
Judge in the impugned judgment, to the effect that no Annual General
Meeting of the company (in liquidation) was held throughout the relevant
period from the appointment of the Special Officers onwards. That apart, it
was also observed by the learned Single Judge that the last available
Annual Report of the company, as evident from the report of the Registrar
of Companies, was dated June 30, 1970. Thus, in the teeth of the factual
observations made by the learned Single Judge to the effect that precious
nothing was done for the benefit of the company (in liquidation) throughout
the period starting from the appointment of the Special Officers, the
question of delay becomes insignificant, since the underlying refrain of the
impugned order was that all actions undertaken pursuant to the post
winding up orders, appointing the Special Officer and consequential
thereto, were vitiated by fraud.
25. Apart from the general proposition that fraud vitiates all, which does
not in all cases exempt an applicant from satisfying the conscience of the
Court regarding the delay, it is found that by the very nature of the
challenge in the instant case, based on subsequent actions taken in
furtherance of the order dated December 12, 1991 and the orders passed
by the Company Court thereafter, the cause of action is in the nature of a
continuing one, arising de die in diem.
26. Hence, it cannot be strictly said that the challenge to such actions
and to the very orders which were the root of the alleged misdeeds was
palpably barred by limitation. At best, in the circumstances of the case, it
may be said that the question of limitation is a mixed question of law and
fact, which is to be decided at the final hearing of the appeal.
27. With regard to the arguments that the trappings of the IBC are
applicable and as such, the Company Court ought not have exercised
jurisdiction, it is surprising that the entire liquidation process, after being
taken out of the control of the Company Court (as exercised through the
Official Liquidator) was vested in Special Officers, that too on consent,
which is beyond the scheme of Company Jurisprudence in India and
operated detrimental to the interest of the company (in liquidation).
28. That apart, it is nobody's case that any proceeding was initiated for
corporate insolvency resolution under the scheme of the IBC vis-à-vis the
company (in liquidation) at any point of time.
29. In fact, the absence of any proper proceedings being initiated in
accordance with law, either under the IBC or otherwise, regarding the
management of the company (in liquidation) and its assets post vesting in
the Special Officers and the Board of Management appointed by Court
orders, is one of the germane premises of the allegation of fraudulent
action in respect of dealings with the assets of the company.
30. Thus, the operation of the IBC cannot come in the way of the
Company Court exercising its jurisdiction.
31. On a more cardinal and basic premise, the learned Single Judge
specifically referred to Rule 9 of the Company Court Rules, 1959 to invoke
the wide inherent powers of the Company Court to pass any directions or
orders for the ends of justice or to prevent abuse of the process of Court.
32. The Company Court, within the scheme of the 1956 Act, has wide
powers pertaining to assets and management of a company (in liquidation).
33. In any event, a Constitutional Court, being a Court of records,within
the contemplation of Article 215 of the Constitution of India and the Letters
Patent (in case of a Chartered High Court), always has the power vested in
it implicitly to correct all wrongs done by it.
34. Looked at from such perspective, it cannot be said ex facie that the
learned Single Judge, acting as a Company Court, lacked jurisdiction to
entertain the complaints and pass the judgment impugned herein, in order
to undo the erroneous orders passed by the Company Court itself,
resulting in perceived mismanagement of the company (in liquation) and
siphoning off of its funds.
35. On the balance of convenience and inconvenience pertaining to the
order of stay now sought, although it has been alleged that by dint of the
impugned judgment, the management of the company would now be vested
in the very persons, due to the mismanagement of whom the winding up
order was passed and affirmed by the appellate Court in the first place,
this Court is unable to accept such contention.
36. In the present case, by virtue of the impugned judgment, the
management would go to the Board of Directors, which would be
comprised of all branches of the Agarwal family, which, as a family, had
majority shareholding and pervasive control over the company (in
liquidation).
37. It is also to be noted that Mr. Arun Kumar Agarwal, the Special Officer
against whom serious allegations have been made, is a part of one of the
branches of the Agarwal family; thus, his interest in such capacity would
not be hampered as such by the impugned judgment.
38. From a different perspective, although the winding up order was
passed and affirmed apparently on the premise of mismanagement by the
erstwhile management of the company (in liquidation), in view of the far
more serious and grave allegations made with regard to the allegedly
clandestine dealings undertaken by Mr. Arun Kumar Agarwal, one of the
Special Officers, even on a prima facie footing, it appears to this Court to be
risky to interdict with the impugned judgment at this stage, since such
stay order would tantamount to retaining the management of the company
with the said Special Officer, against whom there is a judgment of a
competent Court (the impugned judgment) operating at present.
39. Unless such judgment is set aside in appeal, it retains its force and
cannot be brushed aside. Doing so would tantamount to allowing the
appeal itself at this premature stage, before the same is heard out on
merits.
40. We hasten to add that nothing in the above observations should be
construed as a vindication of the allegations levelled against the said Mr.
Arun Kumar Agarwal, who would be at liberty to canvas all points raised
by him against the impugned judgment in his independent appeal which is
also pending, having been assigned before this Bench.
41. The above findings, it is further clarified, are tentative in nature and
shall not in any manner be binding on the parties at any subsequent stage
of the present appeal and/or any other litigation and have been arrived at
only for the purpose of adjudicating the prayer for ad interim stay.
42. We would be failing in our duty unless we mention that at a previous
stage of the appeal, a similar prayer for stay had been made. Although not
specifically refused, the regular Bench taking up the appeal had abstained
from passing any ad interim order, permitting the appellant to renew such
prayer "if required".
43. Evidently, the expression "if required" would indicate an element of
change of circumstance. The appellant merely alleges that upon having
written a letter and not getting any reply thereto, the appellant apprehends
that the Board of Directors have already been formed and have been vested
with the management of the company pursuant to the directions passed in
the impugned judgment.
44. However, such direction was implicit in the impugned judgment itself
and was available to be argued by the appellant before the regular Bench
even on the date when the previous prayer for ad interim stay was not
granted.
45. We do not find any change of circumstance worth the name having
taken place in the interregnum, merely by the appellant writing and not
receiving a reply from the respondents on such count.
46. Hence, in the absence of any change of circumstance, for the sake of
judicial propriety, it would not be appropriate for this Court to pass an
order of ad interim stay which was not granted earlier by the regular Bench
taking up the appeal.
47. In view of the above, the ad interim prayer for stay of the impugned
judgment, as prayed for, is refused.
48. Let the file, including the pending application(s), be now placed before
the regular Bench having determination to hear the main appeal.
49. The respondents shall file their affidavits-in-opposition to the stay
application, bearing ACO/2/2026, within three weeks from date. Replies
thereto, if any, shall be filed within a fortnight thereafter.
50. The application shall also be placed along with the appeal before the
regular Bench after the above timeline for filing of affidavits is over.
51. The parties and all concerned shall act on the server copy of this
order, without insisting upon prior production of a certified copy, for the
purpose of compliance.
(SABYASACHI BHATTACHARYYA, J.)
(SUPRATIM BHATTACHARYA, J.)
bp./sp3
