V.K.Bali, J. - (1.) COMPANY Petition bearing No. 226 of 1999, H. S. Oberoi and Associates v. Punjab Wireless Systems under Sections 433 and 439 of the Companies Act, 1956, for winding up was filed on September 23, 1999. During the pendency of the petition aforesaid, the court vide its order dated July 27, 2000, appointed the official liquidator as the provisional liquidator. On February 1, 2001, the company court disposed of the company petition by passing an order of winding up against the respondent. The appellant after disposal of the company petition aforesaid, filed a petition with a prayer that it should be permitted to execute the recovery proceedings initiated by it, consequent upon the judgment and decree passed by the civil judge dated September 9, 1999, vide which the appellant had been found entitled to a sum of Rs. 7,42,27,312 from Punjab Wireless Systems Ltd. (hereinafter referred to as "the respondent"). In the alternative, it was the prayer of the appellant that the company court should transfer the execution proceedings to itself and to execute the same. This petition with the aforesaid prayer has since been dismissed by the learned company judge, hence the present appeal.
(2.) THE bare minimum facts of the case would reveal that the appellant filed a civil suit on July 31, 1999, for the recovery of Rs. 7,42,27,312 along with future interest. During the currency of the suit aforesaid, the appellant moved an application under Order 38, rule 5 of the Code of Civil Procedure, 1908, for attachment of the movable and immovable properties of the respondent. The learned civil judge vide order dated August 17, 1999, accepted the said application inasmuch as the respondent, i.e., Punwire was directed to furnish a bank guarantee in the sum of Rs. 7.50 crores, failing which two of its properties were ordered to be attached. Thereafter, an application under Order 23, rules 2 and 3 of the Code of Civil Procedure was moved on behalf of the parties, i.e., the appellant and the respondent for passing a compromise decree and the learned civil judge, after recording statements of the concerned parties, disposed of the suit in terms of the said compromise. Accordingly, as mentioned above, a decree for recovery of Rs. 7,42,27,312 was passed with interest at the rate of 17.5 per cent per annum from the date of filing the suit till its realisation. The appellant was permitted to recover the decretal amount in accordance with the compromise, failing which the appellant was allowed to recover the decretal amount in accordance with law. The respondent failed to make any payment to the appellant, thus, the appellant was compelled to initiate execution proceedings by way of Execution Case No. 25 of 1999. In furtherance of the execution case filed by the appellant, the learned executing court on December 6, 1999, ordered the attachment of the properties of the respondent. Inasmuch as, execution proceedings in view of the provisions contained in Section 446 of the Companies Act, 1956, could not proceed any further as after the official liquidator had been appointed as the provisional liquidator, no suit or legal proceedings pending could be proceeded with except with the leave of the court. The application for alternative reliefs as mentioned above was filed. It has been the case of the appellant that the provisions of Section 125 of the Companies Act, 1956, could not obstruct the continuation of the proceedings initiated by it before the executing court, as the claim made by the appellant was not based on a charge created by the company but based on the judgment and decree passed by the learned civil judge. It was further argued on behalf of the appellant that a charge must be deemed to have been created over the properties in question vide orders dated August 17, 1999, and December 6, 1999. The appellant was, thus, a secured creditor and it had legitimate right to recover the decretal amount by continuing the execution proceedings. The claim of the appellant was contested primarily on the ground that the attachment proceedings were not initiated validly being after the commencement of winding up. It was also the contention of the other side that the order of attachment does not create a charge and inasmuch as, no charge had been created, the appellant could not be considered to be a secured creditor for the recovery of decretal amount.
(3.) IT would not be disputed before the learned single judge that winding up proceedings must be deemed to be initiated with effect from the date on which the winding up petition, i.e., Company Petition No. 226 of 1999, was presented, i.e., September 23, 1999. In the context of the facts, as have been given above, it was the case of the respondent that the order of attachment in furtherance of Execution Case No. 25 of 1999 was passed on December 6, 1999, and since the aforesaid order had not been passed with the leave of the court, the same was void under the mandate of the provisions contained in the Companies Act, 1956.;