RAGHUBAR NARAYAN SINGH ALIAS R N SINGH Vs. PACIFIC BANK LIMITED
HIGH COURT OF CALCUTTA
RAGHUBAR NARAYAN SINGH ALIAS R N SINGH
PACIFIC BANK LIMITED
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(1.) THIS appeal arises out of an order made by S. R. Das Gupta, J. (as he then was) in a misfeasance proceeding under section 235 of the Indian Companies Act of 1913, by which he directed that the appellant Raghubar Narayan Singh and one A. K. Das (respondent No. 3) do jointly and severally contribute to the assets of the respondent bank a sum of Rs. 4,97,000/- and further that the appellant do restore to the assets of the respondent bank another sum of Rs. 2,82,692/ -. The respondent bank which was a public limited company was incorporated in the year 1934 and it was ordered to be wound up on March 31, 1947 and Mr. Sidhartha Kumar Ghosh, Chartered Accountant, was appointed Liquidator. On December 4, 1947, an application was filed Tinder section 153 of the Indian Companies Act of 1913 for sanction of a scheme and an interim order was made for stay of proceedings in winding up with certain exceptions. On July, 29, 1948, the application under section 153 was dismissed and the order of stay was vacated. On April 6. 1951, the Liquidator Sidhartha Kumar Ghosh took out a Master's Summons praying for a direction upon the appellant and the third respondent A. K. Das to contribute to the assets of the bank the various sums mentioned in the prayers and also for various other reliefs with which we are not concerned in this appeal. There is an endorsement upon the summons to the effect that the application was noted as made on the 6th April, 1951. The ground in support of the summons is stated to be the petition of Sidhartha Kumar Ghosh, Official Liquidator of the respondent bank verified by his affidavit affirmed on April 3, 1951.
(2.) AS the only question argued before us at considerable length in this appeal is the question of limitation, I should mention at this stage that on the date the Master's Summons was taken out the application of the Official Liquidator was out of time by four months and 10 or 12 days, because the period of limitation prescribed by section 235 of the Indian Companies Act, as it stood at the material time, was 3 years from the date of the first appointment of the Liquidator in winding up. As I have already said in the present case, the Liquidator was appointed on 31st March, 1947 and the period of 3 years would expire on the 30th March, 1950 but the Liquidator is entitled to add to this period a period of 7 months 25 days, for which further proceedings in winding up were ordered to be stayed If this period is added to the statutory period of 3 years the last day of making the application would expire on the 25th of November, 1950, whereas the application was filed on the 6th of April, 1951.
(3.) TO avoid the bar of limitation the Liquidator stated in his original petition that he requested the appellant and other officers of the company to submit a statement of affairs of the company under section 177 A of the Indian Companies Act, but they "refused and/or failed and neglected to do so. " He further stated that he had definite knowledge about the fraud committed by the appellant in carrying on the business of the company in or about October, 1950 in the course of the private examination of the appellant under section 195 of the Indian Companies Act. On May 14, 1953 the Liquidator filed a supplementary affidavit with leave of the Court in which he definitely made out a case under section 18 of the Indian Limitation Act by alleging that he was kept from the knowledge of his right to make the application by deliberate and active concealment of facts and circumstances relating to the affairs of the company and that he was not aware of the fraud prior to the private examination of the appellant in the month of October, 1950. It appears that upon the application of the Liquidator for examination of the appellant under section 195, the private examination of the appellant was held on the 6th and 15th October, 1950. The Liquidator claims in the supplementary affidavit that he was kept from the knowledge of his right by the fraud of the appellant till those dates and the starting point of limitation should be taken as the 15th of October, 1950. Daring the pendency of the proceeding section 45 (0) of the Banking Companies Amendment Act (Act LII of 1953) came into operation on the 30th December, 1953. Section 45 (0) (ii) as it stood on that date provided that notwithstanding anything to the contrary contained in the Indian Limitation Act or section 235 of the Indian Companies Act, the period of limitation in a misfeasance summons shall be 12 years from the date of accrual of the claim. The provisions of this new section 45 (0) were also called in aid by the Liquidator to get rid of the bar of the limitation. On the merits of the case the learned trial judge was satisfied that the appellant was guilty of the various charges of fraud leveled against him and that he had misappropriated large sums of money belonging to the bank by making various false and fictitious entries in the account books of the bank between December 27, 1940 upto the month of December, 1946. No. argument has been advanced before us on behalf of the appellant that this finding of the learned trial judge on the merits of the case is wrong. On the question of limitation the learned trial judge has held that the Liquidator has failed to bring the case within the purview of section 18 of the Indian Limitation Act; but he has held in favour of the Liquidator that the present case is governed by the amended section 45 (0) of the Banking Companies Act, which came into operation on the 30th of December, 1953.;
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