JUDGMENT
Smt. Sujata Manohar, J.
1. This is an appeal from an order of a learned single judge dated September 8, 1988, dismissing misfeasance summons taken out by the official liquidator of Jai Hind Estate and Housing Co. Ltd. (in liquidation) against 16 persons who are directors and/or officers and/or auditors of the company. The learned judge has dismissed the misfeasance summons on the ground that the official liquidator had failed to give inspection of various documents referred to and relied upon by him in the misfeasance summons to respondent No. 15 although inspection was asked for from the year 1982 onwards. The present appeal is from that order of the learned single judge.
2. In order to decide whether we should restore the misfeasance summons so dismissed by the learned single judge, we have to take into account the totality of circumstances relating to the misfeasance summons. The company was ordered to be wound up by an order dated June 23, 1976. The official liquidator took out the present misfeasance summons against the 16 respondents on June 15, 1981, just before the period of five years prescribed under section 543(2) of the Companies Act was about to expire. This misfeasance summons is based on a report of one J.K. Doshi, chartered accountant, who was appointed as inspector of the above company by the Central Government under section 138(iv) of the Indian Companies Act, 1913. He was so appointed on June 7, 1955. The report submitted by him is dated September 30, 1957. The report pertains to accounting years 1946-47 to 1954-55. The charges mainly relate to the accounts for the years 1946-47, 1947-48, 1948-49 and 1949-50. The charges in the misfeasance summons which was taken out in June, 1981, relate to transactions which took place 30-35 years ago.
3. In respect of these very same charges based on the same report, Jai Hind Estates Shareholders’ Association had lodged a complaint against the auditors of the company (one of whom is respondent No. 8 in this appeal) before the Institute of Chartered Accountants of India. Respondent No. 8 had submitted his written statement on May 10, 1965, in respect of the entire report and the allegations made against him in that report. In view of what was pointed out in the written statement, the Institute of Chartered Accountants of India held him not guilty of any professional or other misconduct.
4. Moreover, as the charges pertain to the period 1946-47 to 1950-51 approximately, it is going to be extremely difficult to investigate and establish these charges. The manner of conducting these proceedings by the official liquidator also leaves much to be desired. The original misfeasance summons was against the 16 respondents. It was taken out in June, 1981. As early as in September, 1981, one of the respondents, viz., respondent No. 9, filed an affidavit in which he pointed out that the misfeasance summons was misconceived and was not maintainable because 8 of the 16 respondents had died prior to 1980 and prior to the taking out of the misfeasance summons. These were respondents Nos. 1, 2, 4, 5, 6, 12, 13 and 16. Thus, although the official liquidator became aware in September, 1981, of the death of these 8 respondents, he took no steps either to delete their names and to amend the charges or to ascertain and bring their heirs on record if so warranted. Ultimately, only in the year 1988, he took out a company application being Company Application No. 75 of 1988 for bringing the heirs of respondents Nos. 1 and 16 on record. This application was dismissed by the learned single judge by his order dated February 20, 1988, and an appeal from that order has also been dismissed by us for reasons which we have set out in our judgment and order delivered today.
5. In respect of the present appeal which was filed in October, 1988, the same was admitted on January 30, 1989. The Division Bench at the time of admission recorded in its order dated January 30, 1989, that the appellant-official liquidator was willing to grant inspection of the documents referred to in the order of the learned single judge and the respondents would be at liberty, without prejudice, to take inspection. At this stage, it was clearly in the interest of the official liquidator to ensure that the respondents to the appeal were permitted to take and took inspection of all the documents so that no grievance could be made on that score against him at the time of the hearing of the appeal. When this order was passed on January 30, 1989, only respondents Nos. 1 and 8 were present. Thereafter, the official liquidator did not serve the notice of the appeal on the remaining respondents till May 28, 1992. We are informed that the service was effected earlier, but because a proper service was not effected, the second service was effected on May 20, 1992. Be that as it may, the official liquidator did not call upon any of the respondents to take inspection of the documents in question. In fact, immediately after the order of the appellate court, respondent No. 1’s advocate addressed a letter dated January 31, 1989, to the official liquidator asking for inspection of the documents referred to in the order of the learned single judge. No reply seems to have been given to the said letter. Ultimately, when the appeal reached hearing before us on June 24, 1993, we once again gave a chance to the official liquidator to give inspection and adjourned the appeal for four weeks. The appeal was also required to be adjourned because the third respondent had not been served till then. He has been served only on June 23, 1993, although he happens to be an attorney of this court and could have easily been served much earlier. Despite it being made clear in the order of May 24, 1993, that no further time would be granted, the official liquidator appears to have written a letter to the respondents offering inspection only on July 15, 1993, i.e., about a week prior to the date of hearing. Pursuant to this letter, respondent No. 1 is in the process of taking inspection, but the inspection is not complete in this short period because of the large number of documents relating back to the year 1946 onwards which need to be inspected. Respondent No. 8 who has been throughout asking for inspection from the year 1982 onwards, has appeared before us through his advocate and the learned advocate has informed us that on account of certain difficulties, he was not able to take inspection from July 15, 1993, onwards although he was desirous of having inspection.
6. It is also necessary in this connection to bear in mind that in the winding up, all the creditors of this company have been fully paid and the shareholders have also received a dividend. Looking to the totality of circumstances, and particularly in view of the fact that the misfeasance pertains to events which took place 30 to 35 years back, and also in view of the fact that the creditors of the company have been fully paid, we do not think any useful purpose would be served by restoring the misfeasance summons. It is going to be extremely difficult, looking to the lapse of time, for the respondents to defend themselves properly, just as it is going to be difficult for the official liquidator to establish these charges. Relevant papers, vouchers and other documents may not be forthcoming especially when the misfeasance summons itself was taken out more than 30 years after the alleged misconduct. Eight out of the sixteen respondents had died before the misfeasance summons was taken out. The official liquidator has made no attempt to bring on record the heirs of six out of the eight deceased tortfeasors. His attempt to bring on record the heirs of the remaining two has also proved unsuccessful. In these circumstances, no useful purpose would be served by restoring the misfeasance summons. The appeal is, therefore, dismissed – though for reasons somewhat different from those stated by the learned judge. In the circumstances, there will be no order as to costs.