Rajasthan HC directs Official Liquidator to pay 4% interest to Unsecured Creditor from Winding till declaration of Dividend [Read Order]

The Rajasthan High Court directed the  Official Liquidator to pay 4% interest to Unsecured Creditors from winding till declaration of dividend.

The petitioners, Government of India, Jay Synth Dye Chem Pvt Ltd., Kanwar Lal, M/s Jamna Lal Kailash Chand, M/s Nimar Agro moved application claiming that the time for making the payment of dividend to the remaining contributors for a further period of three months upto November 6, 2020. The Official Liquidator may be permitted to publish one more advertisement in daily news paper Rajasthan Patrika (Hindi) and Hindustan Times (English) through advertisement agency and publish the notice in Form No.63 under Rule 148(1) of the Companies (Court) Rules, 1959 and make the payment to advertisement agency from the fund of the company (In Liquidation)”

The Official Liquidator Mr. DK Meena along with counsel Mr.Rakesh Arora of the petitioner submitted that due to COVID times, making of the payment of dividend to the contributors was not possible, however, permission be given now to comply with the same.

The Official Liquidator present in the Court submits that Rule 179 of the Companies (Court) Rules, 1959 is applicable and the unsecured creditor is entitled to interest at the rate of 4% per annum.

The single Judge Bench of Justice Pushpendra Singh Bhati held that the Official Liquidator is directed to make the payment of dividend to the remaining contributors strictly in accordance with law within a period of 60 days from today. The Official Liquidator shall be required to publish one more advertisement in daily news paper Rajasthan Patrika (Hindi) and Hindustan Times (English) through advertisement agency & publish the notice in Form No.63 under Rule 148(1) of the Companies (Court) Rules, 1959, while making the payment to advertisement agency from the fund of the company.

The Court while listing the matter on August 11, 2021 further said that the instant application is disposed of with a direction to the Official Liquidator to pay 4% interest to the applicant from the date of winding up i.e. 23.02.2010 till the date of declaration of dividend which is 08.04.2019 entitled to an unsecured creditor in accordance with Rule 179 of the Companies Court Rules. The Official Liquidator shall accordingly make necessary payments on the due amount strictly in accordance with law.

To Read the full text of the Order CLICK HERE

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Govt Of India vs Mewar Textiles And Ors , 2021 TAXSCAN (HC) 276 , Advocates: Mr. Rakesh Arora & Mr. DK Meena , Advocates: Mr. Manoj Bhandari, Mr. Manish Shishodia Mr. Sanjay Nahar