The Official Liquidator vs K.Subramaniam (Died)
2023 Latest Caselaw 11155 Mad

                                                                           C.R.P.(NPD)No.1064 of 2018



                                  IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                                   DATED: 24.08.2023

                                                        CORAM :

                         THE HONOURABLE MR.JUSTICE V. LAKSHMINARAYANAN

                                               C.R.P(NPD)No.1064 of 2018


                     The Official Liquidator,
                     High Court, Madras as the Liquidator
                     of M/s.Selvarani Chit Funds (P) Limited
                     (in liquidation)                                            .. Petitioner

                                                            vs

                     1.K.Subramaniam (Died)
                     2.S.Subramaniam
                     3.P.Thirugnanam
                     4.R.Thirugnanam
                     5.Kalamani Subramaniam
                     6.Gandhimathi Perumal
                     7.Rajavel Subramaniam                                 .. Respondents
                       st
                     (1 Respondent died, Respondents 5 to 7 brought on
                     record as LRs of the deceased R1 viz. K.Subramaniam
                     vide Court order dated 8.8.2023 made in CMP.Nos.9048,
                     9051 & 9055 of 2023 in CRP(NPD)No.1064 of 2019.)


                                  Petition filed under Section 115 of the Civil Procedure Code
                     against the order and decreetal order dated 05.12.2016 passed by the
                     Additional District Judge, Salem (Fast Track Court No.1, Salem in
                     R.E.P.No.19 of 2009 in O.S.No.159/2005).


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                                                                                 C.R.P.(NPD)No.1064 of 2018

                                        For Petitioner      : Mr.B.Dhanraj
                                                              for Official Liquidator

                                        For Respondents : R1 – Died

                                                             Mr.S.Adarsh (for R2)
                                                             for Mr.Anirudh Krishnan

                                                             Mr.K.S.Navin Balaji (for R5 to R7)

                                                           ORDER

The Official Liquidator attached to this Court has filed the revision

against the order of execution in E.P.No.19 of 2009 in O.S.No.159 of

2005 on the file of the Additional District Judge-cum-Fast Track Court

No.1, Salem.

2.O.S.No.159 of 2005 was filed by one K.Subramaniam. The

defendants in that suit were (i)S.Subramaniam, (ii)R.Thirugnanam and

(iii)P.Thirugnanam. O.S.No.159 of 2005 is a suit for specific

performance of an agreement of sale. The suit was decreed on

12.02.2008. In pursuance thereof, E.P.No.19 of 2009 was filed.

3.It is the objection of the learned Official Liquidator that the

defendants 1 to 3, who are the Directors of one Selvarani Chit Funds has

utilised the funds from the said Selvarani Chit Funds (P) Limited and

have purchased the property. In other words, the learned Official

Liquidator would seek to invoke Section 456 of the Companies Act,

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C.R.P.(NPD)No.1064 of 2018

1956 in order to state that the property which 'appears to be’ the property

of the Company cannot be sold in execution of a decree obtained as

against the Directors in their personal capacity.

4.Pending the revision, the first respondent died and his legal

heirs were brought on record as respondents 5 to 7. They are represented

by Mr.K.S.Naveen Balaji. He would bring to my notice that in the

winding up proceedings initiated against the Company in C.P.No.260 of

2004, Mr.S.Subramaniam that is, the second respondent had filed an

application stating that the proceedings in E.P. will have to be stayed

because the properties are of the Company under liquidation and not

properties of the individual judgment debtors concerned.

5.He would draw my attention to paragraph 3 of the order

whereunder, this Court had dismissed Company Application in

C.A.No.105 of 2017 on 11.08.2017 holding that the property is the

individual property of the Directors and not the property of the

Company. This order passed under Section 446(1) of the Companies Act

operates as res judicata in the present proceeding.

6.It is pertinent to point out that the Official Liquidator was the

first respondent in C.A.No.105 of 2017 and as against the said finding

that the property belongs to the Directors in their individual capacity and https://www.mhc.tn.gov.in/judis

C.R.P.(NPD)No.1064 of 2018

not in the capacity as Directors of the Company, though affecting the

interest of the Official Liquidator, was not appealed against. In fact,

even a clarification petition was not moved before the learned Judge to

permit the Official Liquidator to raise this objection before the

appropriate forum. The Company Courts jurisdiction under Section 446

is wide and I am bound by the order passed by the Company Court in

Company Application No.105 of 2017 in Company Petition No.260 of

2004 dated 11.08.2017.

7.The finding of this Court is equally binding on the learned II

Additional District Judge, Salem and therefore, he rightly ordered the

execution of the decree. I cannot find any illegality or irregularity in the

order. The civil revision petition deserves only an order of dismissal and

accordingly it is dismissed. No costs.

24.08.2023 Index:Yes/No Speaking order/Non-speaking order Neutral Citation:Yes/No vs

To

The Additional District Judge, (Fast Track Court No.1), Salem.

https://www.mhc.tn.gov.in/judis

C.R.P.(NPD)No.1064 of 2018

V. LAKSHMINARAYANAN,J.

vs

C.R.P(NPD)No.1064 of 2018

24.08.2023

https://www.mhc.tn.gov.in/judis