ORDER K.S. Paripoornan, J. 1. This is an application filed under S.446 of the Companies Act, 1956 read with R.105, 117 and 118 of the Companies (Court) Rules, 1159. The applicant as well as the 3rd respondent herein, are judgment debtors in O.S. No. 1 of 1972 of the Sub Court, Tellicherry in the suit filed by the 1st respondent company for realising an amount of Rs. 8,636. It was decreed on 31st July 1975. By the decree, a charge was created over the landed property extending to 7/2 cents under Re Sy. No. 407/3, 4 and 5 of Kannapuram amsom. The 1st respondent company filed E.P. No. 51 of 1975 and brought the property to sale. E.A. No. 126 of 1975 was filed by it seeking permission to bid the property in the auction. It was granted. In the meanwhile, the 3rd respondent paid Rs. 3,000. The 4th respondent filed the suit against the 1st respondent company, O.S. No. 349 of 1979, of the Sub Court, Tellicherry, for recovering a sum of Rs. 7,000 and odd and obtained a decree on 8th March 1980. In the said suit E.P. No. 85 of 1980 was filed by the 4th respondent on 12th June 1980, and he attached the decree obtained by the 1st respondent against the petitioner and the 3rd respondent (O.S. No. 1 of 1972). E.P. No. 150 of 1980 was thereafter filed in O.S. No. 1 of 1972 for sale of the property involved in that suit. The property was brought to sale on 2nd June 1983 and it was purchased by the 4th respondent. The sale was for Rs. 10,010 and after setting off the amount due under the decree, the balance of Rs. 3,010 was deposited in court which may go in satisfaction of the 1st respondent's decree against the applicant (decree holder in O.S. No. 1. of 1972). The sale was confirmed on 10th August 1983 and full satisfaction was entered in O.S. No. 349 of 1979 as per E.A. No. 296 of 1983. The applicant, the 3rd respondent, (Co-judgment debtor) the 1st respondent - decree holder in O.S. 1 of 1972 - (and the judgment debtor in O.S. 349 of 1979) as well as the 4th respondent, were parties in E.P. No. 150 of 1980.
The applicant, the 3rd respondent, (Co-judgment debtor) the 1st respondent - decree holder in O.S. 1 of 1972 - (and the judgment debtor in O.S. 349 of 1979) as well as the 4th respondent, were parties in E.P. No. 150 of 1980. That E.P. was filed by the 4th respondent herein for sale of property involved in O.S. No. 1 of 1972, the property belonging to the applicant herein. There were several adjournments in that execution proceedings for payment. The property was brought to sale only on 2nd June 1983. The Amin went to the property on 1st October 1983 in pursuance to the order passed by court in E.P. No. 149 of 1983 in O.S. No. 1 of 1972 on application by the 4th respondent, dated 14th September 1983. After opening the locks, some of the rooms were delivered over to the 4th respondent. Two rooms could not be delivered due to some obstruction by one Govindan and Gangadharan. The Amin filed a report to that effect on 3rd October 1983 praying for Police aid for completing the delivery. The 4th respondent also filed E. A. No. 382 of 1983 in O. S.1 of 1972 making a similar request. That stood posted to 4th October 1983 and adjourned from time to time due to some objections raised by the applicant, the 3rd respondent and other persons. In the meanwhile, this application was filed in this court on 10th October 1983 and interim orders were obtained on 11th October 1983. 2. The main objection of the applicant is that the 1st respondent company was wound up and the Provisional Liquidator was appointed in C. P. No. 9 of 1981 by order dated 16th June 1981. The 2nd respondent was appointed as the Provisional Liquidator. The 4th respondent was incompetent to act as he did to attach the property on 23rd December 1982 and still later when it was brought to sale. It is alleged that the purchase of the property by the 4th respondent, after the appointment of the Provisional Liquidator, is opposed to S.446 of the Companies Act and the same is void under S.537 of the Act. So, it is prayed that the pending proceedings in O. S. No. 1 of 1972 and O. S. No. 349 of 1979 should be transferred to this court as also E. P. No. 150 of 1980.
So, it is prayed that the pending proceedings in O. S. No. 1 of 1972 and O. S. No. 349 of 1979 should be transferred to this court as also E. P. No. 150 of 1980. This application is opposed by the 4th respondent. It is stated that the winding up order passed by this court dated 16th June 1981 has been kept in abeyance by the orders passed in M.F.A. Nos. 578, 579 and 520 of 1981 by order dated 8th October 1982. [ILR 1983 (1) Ker. 700] The provisions of S.446 are totally inapplicable. No leave is required to continue the proceedings in O.S.1 of 1972 and O. S. No. 349 of 1979 and no question of transferring the said proceedings to this court arises. It is also contended that mere appointment of a Provisional Liquidator does not affect the continuance of the pending proceedings and no leave of court is required. Thirdly, the 4th respondent contends that S.537 will apply only if there is a winding up order and S.537 should be read along with S.446(2) of the Act. In this case it cannot be said that the company is being wound up. It is also the 4th respondent's plea that at any rate the applicant is not entitled to invoke the provisions of S.537 of the Act and contend that the proceedings by way of sale in O. S. No. 1 of 1972 are void, illegal and therefore liable to be set aside, or that the proceedings in O. S. No. 349 of 1979 should be transferred to this court. This is all the more so, in view of the conduct of the applicant and the 3rd respondent in the execution proceedings. They took part in the entire proceedings, after the original order of winding up and appointment of a provisional liquidator were passed by this court on 16th June 1981 and after which date the 4th respondent to appropriate steps to bring the property to sale and purchased it. 3. S.446 and 537 of the Companies Act on which reliance was placed by counsel on both sides, may be quoted herein: "446.
3. S.446 and 537 of the Companies Act on which reliance was placed by counsel on both sides, may be quoted herein: "446. Suit stayed on winding-up order - (1) When a winding up order has been made or the Official Liquidator has been appointed as provisional liquidator no suit or other legal proceeding shall be commenced, or if pending at the date of winding-up order, shall be proceeded with, against the company, except by leave of the Court and subject to such terms as the court may impose. " (2) The Court which is winding-up the company shall, notwithstanding anything contained in any other law for the time being in force, have jurisdiction to entertain, or dispose of (a) any suit or proceeding by or against the company; (b) any claim made by or against the company (including claims by or against any of its branches in India); (c) any application made under S.391 by or in respect of the company; (d) any question of priorities or any other question whatsoever, whether of law or fact, which may relate to or arise in course of the winding-up of the company; whether such suit or proceeding has been instituted, or is instituted, or such claim or question has arisen or arises or such application has been made or is made before or after the order for the winding-up of the company, or before or after the commencement of the Companies (Amendment) Act, 1960. (3) Any suit or proceeding by or against the company which is pending in any Court other than that in which the Winding-up of the company is proceeding may, notwithstanding anything contained in any other law for the time being in force be transferred to and disposed of by that court. (4) Nothing in sub-s.(1) or sub-s.(3) shall apply to any proceeding pending in appeal before the Supreme Court or a High Court. * * * 537. Avoidance of certain attachments, executions, etc., in winding-up by or subject to supervision of Court.
(4) Nothing in sub-s.(1) or sub-s.(3) shall apply to any proceeding pending in appeal before the Supreme Court or a High Court. * * * 537. Avoidance of certain attachments, executions, etc., in winding-up by or subject to supervision of Court. - (1) Where any company is being woundup or subject to the supervision of the court (a) any attachment, distress or execution put in force without leave of the court, against the estate or effects of the company after the commencement of the winding-up; or (b) any sale held without leave of the Court, of any of the properties or effects of the company after such commencement; (2) Nothing in this section applies to any proceedings for the recovery of any tax or impost or any dues payable to the Government." 4. It is true that an order of winding-up was passed and a provisional liquidator was appointed by a learned Single Judge by order dated 16th June 1981. But it is seen that in the appeal - M.F.A. Nos. 578, 579 and 520 of 1981 Sudarsan Chits (India) Ltd. v. Sukumara Pillai (ILR 1983 (1) Kerala 700) from pages 737/738 of the report, that the Official Liquidator was directed to function as the Provisional Liquidator and the winding-up order was held in abeyance. It is common ground that the judgment of the Division Bench, whereby the winding-up order was ordered to be kept in abeyance, is still in force. If that is the position, the only question is, even assuming that the Provisional Liquidator was appointed for certain purposes as envisaged by S.450(1) and (3) of the Act, whether S.446(1) will be attracted. In John v. Coir Tarn and Textiles Ltd. (2) at page 132 Raman Nayar, J. held: "On the wording of S.446(1) of the Companies Act, 1956. which, in this respect makes a significant departure from the language of S.171 of the Act of 1913, the appointment of the provisional liquidator does not affect the continuance of a pending proceeding, and leave of the winding up court is required only for commencing a new proceeding. But, once a winding up order is made, even the continuance of a pending proceeding can only be by leave of the Court and subject to such terms as the court may impose." In this case, the winding-up order is kept in abeyance. No doubt, there is a "Provisional Liquidator".
But, once a winding up order is made, even the continuance of a pending proceeding can only be by leave of the Court and subject to such terms as the court may impose." In this case, the winding-up order is kept in abeyance. No doubt, there is a "Provisional Liquidator". Even so, I am of the view that the 4th respondent was not obliged to obtain the leave of this court to continue the execution proceedings in O.S. No. 1 of 1972 when he brought the property to sale. S.446(1) of the Act is not attracted to the instant case. This follows from the decision reported in John v. Coir Yarn and Textiles Ltd. ( 1960 KLT 127 at 132). In this view of the matter, there is no infirmity to the execution proceedings taken in O.S. No. 1 of 1972 and O.S. No. 349 of 1979 of the Sub Court, Tellicherry and the applicant cannot have any grievance in the matter. 5. The submission of applicant's counsel placing reliance on S.537 of the Companies Act is without substance. S.537 of the Act will apply only if a company is being wound-up by or subject to the supervision of this Court. That goes along with S.446(2) of the Act. Admittedly, in this case the company is not being wound-up. So, the provisions of S.537 of the Companies Act read with S.446(2) of the Act cannot have any application in this case. I am of the view, that even if it is said that once the provisional liquidator is appointed under S.450 of the Act, leave of court shall be obtained under S.446(1), that is a plea which is available only to the Official Liquidator and the applicant is incompetent to base any claim or right on the ground of absence of leave under S.446(1) of the Act. The applicant has no locus standi to sustain any plea, on the ground of absence of leave under S.446(1) of the Act. The fight, if any, to place reliance on S.446(1) read with S.537 of the Act is only available to the Liquidator and not to the applicant. 6. Lastly, I should also state that the conduct of the applicant disentitles her to move this court. The applicant and the 3rd respondent were parties in E.P. No. 150 of 1980 in O. S. No. 1 of 1972.
6. Lastly, I should also state that the conduct of the applicant disentitles her to move this court. The applicant and the 3rd respondent were parties in E.P. No. 150 of 1980 in O. S. No. 1 of 1972. The petition was filed for sale of the property involved in O. S. No. 1 of 1972. The matter came up for consideration on many occasions. Adjournments were sought by remitting some amount. The property was brought to sale on 23rd December 1982. The 4th respondent purchased the property after obtaining leave of court. The sale was confirmed. Full satisfaction was recorded. The Amin went to the property to effect delivery. Part delivery was also effected. It is after all these, the applicant has chosen to move this court for transferring to this court all execution proceedings in respect of O. S. No. 1 of 1972 and O. S. No. 349 of 1979, Sub Court, Tellicherry. The applicant took part in the execution proceedings at various stages. Her conduct, viewed as a whole, disentitles her to move this court at this distance of time. I am inclined to take the view that, on the facts, this application is filed without bona fides. I am of the view that this application is intended to delay the execution of a lawfully obtained decree. Orders have been passed at different stages in the execution proceedings and property itself has been sold. These were done as per orders of courts. It is not permissible for the applicant either to ignore such proceedings or orders or to nullify them collaterally as purported to be done at present. Such orders of courts are not void and "of no effect". They are valid and legal until set aside or avoided by competent persons, in appropriate forum, as prescribed by law. Till then, such orders or proceedings and the steps taken therein, will hold good. In this view also, the applicant has no case. 7.
Such orders of courts are not void and "of no effect". They are valid and legal until set aside or avoided by competent persons, in appropriate forum, as prescribed by law. Till then, such orders or proceedings and the steps taken therein, will hold good. In this view also, the applicant has no case. 7. Counsel for the 4th respondent brought to my notice the decision in Roopnarain Pvt. Ltd. v. Brahmapootra Tea Co.(3) and contended that the 4th respondent was not aware of the appointment of the Provisional Liquidator or proceedings in C.P. No. 9 of 1981, and that if it is held that leave is necessary under S.446 of the Act, this Court may be pleased to grant leave retrospectively under S.446 of the Act read with S.547 of the Act. In this view of the matter, O.S. No. 1 of 1972 and O.S. No. 349 of 1979 of the Sub Court, Tellicherry may be permitted to be proceeded with. The 4th respondent has moved this Court in that connection by way of M.C.A. No. 47 of 1983. I heard counsel for the 1st respondent, counsel for the applicant as also counsel for the 4th respondent in this behalf. It is true that the dictum in Roopnarain Pvt. Ltd. v. Brahmapootra Tea Co. ( AIR 1962 Cal. 192 ) supports counsel; and there is considerable force on the merits, as pleaded by counsel. But in view of the fact that there is no winding-up order in force as on today, leave applied for is unnecessary. Even assuming that a provisional Liquidator has been appointed for certain purposes, I do not think, it is open to the applicant herein to raise the objections regarding want of leave under S.446 of the Act. In this view of the matter, I do not pass any order on merits in M.C.A. No. 47 of 1983 as no further orders are necessary in the matter. The net result is, that M.C.A. No. 44 of 1944 is groundless and filed without any bona fides. The same is dismissed with costs of the 4th respondent. M.C.A. No. 47 of 1983 is dismissed, since no further orders are necessary at present.