Page 231 - DCOM106_COMPANY_LAW

Company Law

Notes 8. Power to Summon Persons suspected of having property of company, etc. (s.477): The
court may summon before it any officer of the company or person known or suspected to
have in his possession any property or books or papers of the company or known or
suspected to be indebted to the company. Any such person may be examined on oath. The
court may also require him to produce any books and papers in his custody or power
relating to the company; but where he claims any lien on books or papers produced by
him, the production must be without prejudice to that lien.
If any officer or person summoned, after being paid or tendered a reasonable sum for his
expenses, fails to appear before the court at the time appointed without any valid reason,
the court may cause him to be apprehended and brought before the court for examination.
9. Power to Order Public Examination of Promoter, Directors, etc. (s.478): Where the Official
Liquidator has made a report to the court, stating that in his opinion a fraud has been
committed by any person in the promotion or formation of the company, or by any officer
of the company since its formation, the court may direct that person or officer may appear
before the court and be publicly examined. Examination shall relate to the promotion or
formation or the conduct of the business of the company, or as to his conduct and dealings
as an officer thereof. Official liquidator, any creditor or contributory may take part in such
examination. The court may put such questions to the person examined as it thinks fit. The
person shall be examined on oath and must answer all such questions as the Tribunal may
put or allow to be put, to him. Notes of the examination must be taken in writing and must
be read over to or by and signed by the person examined and may thereafter be used in
evidence against him. Statement so recorded shall be open to the inspection of any creditor
or contributory at all reasonable times.
10. Power to arrest a Contributory Intending to Abscond (s.479): At any time (either before or
after making a winding up order), the court may, on proof of probable cause for believing
that a contributory is about to quit India or otherwise to abscond or is about to remove or
cancel any of his property, for the purpose of evading payment of calls or of avoiding
examination in respect of the affairs of the company, cause: (a) the contributory to be
arrested and safely kept until such time as the Tribunal may order; and (b) his books and
papers and movable property be seized and safely kept until such time as the Court may
order.
11. Power to Order for Dissolution of the Company (s.481): When the affairs of a company
have been completely wound up or when the court is of the opinion that, the liquidator
cannot proceed with the winding up of a company for want of funds and assets or for any
other reason whatsoever and it is just and reasonable in the circumstances of the case that
an order of dissolution of the company should be made, the court shall make an order that
the company be dissolved from the date of the order. The liquidator must, within 30 days,
send a copy of the order to the Registrar who shall make in his books a minute of the
dissolution of the company. If he makes a default in forwarding a copy as aforesaid, he
shall be punishable with fine which may extend to 500 for every day during which the
default continues. On the expiry of 5 years from the date of dissolution, the name of the
company should be struck off the register. But within 2 years of the date of the dissolution
on application by the liquidator of the company or by any other person who appears to
the court to be interested, the court may make an order, upon such terms as the court
thinks fit, declaring the dissolution to have been void. After such an order is passed, such
proceedings may be taken as might have been taken if the company had not been dissolved
(s.559).

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