- (1.) This is an appeal by a liquidator at a voluntary liquidation against an order of Banerjee, J., dated March 13, 1952, whereby the learned Judge dismissed the Appellant's application for exemption from the liability to pay interest under Section 244B(7) of the Indian Companies Act on two sums of unclaimed dividends, which he had failed and omitted to deposit in the Reserve Bank of India as required by the section Banerjee, J. has found that in omitting to deposit the amount, the Appellant did not act dishonestly, but that he had not acted reasonably and that, accordingly, he was not entitled to the relief prayed for by him.
(2.) The application was made under Section 281(2) of the Indian Companies Act which provides that if a person has reason to apprehend that any claim will or might be made against him in respect of any negligence or default, he may apply to the Court for relief. The nature of the relief which the Court cannot grant is indicated in Sub-section (1) of the section which provides that the Court may relieve such an applicant, either wholly or partly, from his liability on such terms as the Court may think fit. Section 244B(7) provides: Any liquidator retaining any money which should have been paid by him into the Companies Liquidation Account under this section shall pay interest on the amount retained at the rate of twenty per cent, per annum and shall also be liable to pay any expenses occasioned by reason of his default....
(3.) The rest of the section is not material. From the terms of the section it might prima facie appear that what the section is doing is to define a particular kind of statutory default and to provide that on the default occurring, the liability stated in the section will automatically accrue. If such be the true meaning of Section 244B(7), there would obviously be no room for the exercise of any discretion by the Court by way of giving relief from the liability to pay interest. It was, however, conceded before us by Mr. Bhabhra, who appears on behalf of the Registrar of Joint Stock Companies, that Section 281 would apply to a case under Section 244B(7). I shall proceed on that assumption and pass on at once to the facts.;