JUDGMENT
N.K. Jain, C.J.
1. This O.S.A. is filed against the order of the learned Company Judge, dated 3.6.2002, passed in Company Application No. 563/ 2001 arising out of Co. A. 1289/2000 in Company Petition No. 8/ 1974.
2. It is stated that the appellant – respondent was designated as Official Liquidator attached to the High Court. Pending Company petitions, the matter was transferred vide order dated 11.4.2000 passed in C.A. 1289/2000 in Co. P. 8/1974 and respondent No. 1 became the Official Liquidator under Section 448(1)(b) of the Companies Act to work as Official Receiver in Civil Courts and to take possession of the records. The grievance of the learned Counsel for the Applicant – Respondent is that despite expiry of the term and the appointment of M. Ramachandra Reddy as Official Receiver of Bangalore District, still the learned Single Judge has extended H. Puttaswamy’s term invoking Rule 9 of the Company Court Rules ( in short the Rules) to continue with the work entrusted to him vide order dated 11.4. 2000. The order of the learned Single Judge is liable to be set aside.
3. On the other hand, G.S. Visweswara, learned Counsel for the respondents, submits that a number of Company applications have been transferred and under the circumstances, the learned Company Judge has invoked the powers and allowed H. Puttaswamy to continue even though his term has expired. Learned Counsel further submitted that in view of Section 524 of the Companies Act, the Court has got power to make impugned appointment and to extend the term. Therefore, no interference is called for.
4. The facts are not in dispute that pending company petition H. Puttaswamy (R-1) has been appointed and the matter was transferred and vide order dated 11.4.2000 in C.A. 1289/2000 in Co. P. 8/74 the learned Company Judge directed R-1 to work as an Official Receiver in City Civil Court to take possession of the records and he was given 3 years time complete the work though actually his term had expired on 20.8.2001. Mr. Ramachandra Reddy was appointed as an Official Receiver vide notification dated 20.8.2001 from the date of notification and as per the corrigendum H. Puttaswamy was allowed to continue in respect of I.C.No. 6/93 connected with 7/1993, pending on the file of CCH-11 and in respect of O.S. No. 809/80 pending on the file of CCH-14, only till the completion of the proceedings.
5. We have heard the learned Counsel for the parties and perused the material on record and the relevant sections.
6. We have perused Section 57 of the Provincial Insolvency Act, 1920 (for short ‘Insolvency Act’), which deals with the power to appoint Official Receiver within such local limits as it thinks fit to be receiver under the Act, as may be prescribed. So far as regards appointment of Official Liquidator under Section 448 of the Companies Act, where a winding up proceedings has been initiated as power the provisions of the Companies Act, in case no receiver is appointed, the Official Liquidator attached to the High Court can serve as an Official Receiver of the District Court. In the instant case, the fact remains that the term of the Official Liquidator H. Puttaswamy had expired by 20.8.2001, though he had done substantial work during that period and required further time for the other remaining work as suggested. He cannot be continued by invoking Rule 9 of the Rules and under Section 524 of the Companies Act as stated. A plain reading of Section 524 of the Companies Act would show that under the said Section, the Court can appoint only an additional Liquidator or Liquidators. That is not the case here. A new Official Receiver Ramachandra Reddy has been appointed for the Lower Court for discharging his duty in the Civil Courts and the persons so appointed as successor in the office is bound to carry out the work and to perform the functions as such and to comply with the directions in accordance with law. More so, the extension of the 1st respondent’s term by the corrigendum pertains to only two matters as stated above and not to this case. It is also seen that Section 57 of the Insolvency Act confers power only on the Government and not on the Court.
7. The learned Counsel for the 1st respondent has not been able to show what subsisting right he has after the expiry of the term of the office of Official Liquidator as stated. Therefore, extending his services by invoking Rule 9 of the Rules, is uncalled for. The discretion so exercised by the learned Single Judge cannot be said to be reasonable or judicious in the facts of the given case.
In view of the above discussion, the order of the learned Counsel is not sustainable and is liable to be set aside. Accordingly, this appeal is allowed and the impugned order is set aside.