JUDGMENT Sanjeev Prakash Sharma, J —Instant company application has been preferred by the Official Liquidator (herein after referred as 'OL') under Section 543 of the Companies Act, 1956 (hereinafter referred as the 'Act of 1956') wherein he has alleged that the respondents-Directors of M/s Surya Power Ltd. (hereinafter referred as 'Company in liquidation') have committed misfeasance within meaning of Section 543 of the Act of 1956 and has prayed that the respondents be compelled to restore such money and properties of the Company in liquidation as this Court may deem fit and proper and also direct them to compensate for the act of misfeasance. 2. Brief facts of the case are that the Company in liquidation was referred to by BIFR in terms of Section 20 of the then SICA Act on 29/01/1993 and was declared sick. On 04/08/1995, on the recommendation of the BIFR, the Company in liquidation was directed to be wound up in Company Petition No.7/1993. On 30/06/1997, statement of affairs were filed by the respondent No.1-S.K. Bhargava. The possession of the factory and unit could not be taken by the OL as the same had already been taken over by the RIICO under Section 29 of the SFC Act on 17/03/1993. The inventory was prepared but the current stock was not included which related to raw material, consumables/stocks, finished/semifinished goods. On 26/02/1996, the RIICO sold the entire factory and unit excluding the current assets to M/s Havells (India) Ltd. A joint verification was conducted on 19/08/1996 by the RIICO, Central Bank of India and Havells (India) Ltd.. The RIICO deposited with the OL the balance sale consideration on 20/11/1997 of Rs.1, 08, 90, 000/-. The RIICO sent a letter on 15/01/1998 that no record, current asset were found in the factory unit of the Company in liquidation. In the circumstances, Chartered Accountant was appointed who submitted his report under Section 543 of the Act of 1956 on 31/07/2000 on the basis whereof, the present company application under Section 543 of the Act of 1956 was filed by the OL with the aforesaid prayers. 3. On 11/11/2010 following issues were framed by this Court on the basis of pleadings on record:- "1. Whether the ex-directors of the company have misappropriated the money and properties of the company (in liquidation) namely M/s. Surya Power Limited? 2. 3. On 11/11/2010 following issues were framed by this Court on the basis of pleadings on record:- "1. Whether the ex-directors of the company have misappropriated the money and properties of the company (in liquidation) namely M/s. Surya Power Limited? 2. Whether the ex-directors of the company have been negligent and are personally responsible for not recovering the money from the loanees and the persons to whom the advances had been granted? 3. Whether the ex-directors have not handed over the assets of the company and complete account books to the Official Liquidator and whether they are liable for restoring the properties, record and all the money of the company to the Official Liquidator? 4. Whether an amount of Rs. 20, 64, 331/- towards stock of raw-material, finished goods packing and other stores and spares stock in process and scrap is liable to be given to the Official Liquidator by the respondents? 5. Whether the respondents have not given the share certificates and S.B. Account No. and address of the post office to the applicant which resulted in nonrealization of any amount? 6. Whether the respondents are liable for the value of the amount towards debt for which no steps were taken for recovery within the limitation amounting to Rs. 12, 14, 826.00 and Rs.64, 58, 771.93 towards loans and advances and sundry debtors respectively?" 4. Affidavit in support of the company application was filed by the then OL alongwith Exhibits-A to G and thereafter as the OL had been transferred, the affidavit of his successor OL was filed alongwith Exhibits A to G. The affidavit of the Chartered Accountant Mr. N.C. Jain was also filed in support of the application and both the OL as well as the Chartered Accountant were cross-examined. 5. The case was heard. Issues are dealt with and decided as under:- 5.1 Issue no.1 is with regard to the allegations against the Directors of the Company in liquidation having misappropriate the money and properties of the Company in liquidation. Neither from the report of the Chartered Accountant nor from the submissions made before this Court, it has come on record to show that the concerned Directors, after the winding up order was passed, misappropriated the money and properties of the Company in liquidation. Neither from the report of the Chartered Accountant nor from the submissions made before this Court, it has come on record to show that the concerned Directors, after the winding up order was passed, misappropriated the money and properties of the Company in liquidation. It is also not made out from the facts that the properties of the Company in liquidation were in their possession as the possession of the factory and unit had been taken over by the RIICO under Section 29 of the SFC Act on 17/03/1993. So far as the current assets namely; raw material, consumables/stocks, finished/semi-finished goods are concerned, they were also taken over by the RIICO. Counsel for the OL has not been able to make out that the Directors have in any manner misappropriated the properties of the Company in liquidation and to that extent the issue no.1 is decided in favour of the respondents. 5.2 The second and sixth issues are commonly decided. These issues relate to the alleged personal responsibility of the Directors in not recovering the money from the loanees and not taking any steps for recovering the debt within the limitation period. It is alleged that a sum of Rs.12, 14, 826/- as loan and sundry debts of a sum of Rs.64, 58, 771.93 were outstanding in terms of the balance-sheet ending 31/03/1993. In this regard, learned counsel for the OL submits that the debts were deliberately allowed to become time barred by the Directors and thus they have failed to perform their duty under the Act of 1956 to recover the loans and debts from the various persons to whom the amount had been advanced. It is stated that as per report of the Chartered Accountant, a sum of Rs.12, 14, 827.07 had become time barred prior to the date of winding up and similarly a sum of Rs.64, 58, 771.93 was due as sundry debts as per the ledger of the year ending 31/03/1993 but no steps for recovery were made nor the amounts were written of in the books. Per-contra, counsel for the respondents submits that the Company in liquidation had already been referred as a sick company on 29/01/1993 and was suffering from accumulated losses. Per-contra, counsel for the respondents submits that the Company in liquidation had already been referred as a sick company on 29/01/1993 and was suffering from accumulated losses. The debts, which were reflected as on 31/03/1993, were required to be recovered by the OL who had taken over the assets on 04/08/1995 but he has only taken the balance-sheet up 31/03/1992 and therefore, the respondents cannot be held guilty for the charges. It is his submission that the limitation to recover the amount was three years and as the balance of 1992-93 reflected of the said debts, it cannot be said that the limitation had expired. Moreover, the limitation would arise from the date the OL has learnt of the said debts for the purpose of recovery and in terms of Section 543 of the Act of 1956, the limitation would be of six years and not three years. The balance-sheets of 1992-93 could not have been added as possession of the factory and unit had been taken over on 17/03/1993 itself. However, even the unaudited balance-sheet could have been examined by the Chartered Accountant. Learned counsel further submits that omission to recover money from the loanees would not amount to come within the ambit of Section 543 of the Act of 1956. It is submitted that a look at the examination of the OL and CA shows that there is a contradiction relating to the report (Exhibit-G) by the OL as well as CA. While the CA in his report has mentioned in para 13 of its report that "the OL on the basis of the available records and information had initiated recovery proceedings by issuing notices to the debtors but it was observed by him that most of the debtors had refused to acknowledge the debts and denied their liability for any amount payable to the Company in liquidation" whereas in the cross-examination, the OL has categorically stated that in the absence of the complete address of the debtors and on account of the limitation period having expired, no action was taken for recovery of the loans. It is stated that when the statement of affair was submitted by the respondents, by that time, the limitation period had expired against the debtors. Similarly, in the cross-examination, the concerned Chartered Accountant Mr. It is stated that when the statement of affair was submitted by the respondents, by that time, the limitation period had expired against the debtors. Similarly, in the cross-examination, the concerned Chartered Accountant Mr. NC Jain has also stated that he does not remember whether there was any letter issued for recovery from the debtors by the OL and he does not remember whether any correspondence in this regard was taken up by the OL. Thus, learned counsel submits that contradictions clearly reflected inaction on the part of the then OL who has tried to recover his mistake and put burden on the respondents. Having heard counsel for both the parties and having examined the statements made by each of them on oath before this Court, it is apparent that there has been a complete dereliction of duties by the concerned OL. He was required to immediately take steps for recovery of loans which had been advanced and the details which were already available on the balance-sheets. The Director, on his part, has accepted his willingness to assist the OL at all times but it appears that due to laxity and for the reasons best known to the concerned OL, no steps were taken at his level. It is also surprising that the Chartered Accountant, who mentions about the same facts in his report relating to the OL having taken steps and giving out reasons for not recovering on account of the debtors refusing to repay the loan and debt, although when examined on oath, he states that he does not have any knowledge of such action having been taken by the OL. The OL also does not support the averments of the report (Exhibit-G) in his statement, as noted above. Thus, in light of above, after the Company in liquidation was taken over on 17/03/1993 by the RIICO and winding up order having been passed in 1995, it cannot be said that the concerned Managing Director is guilty of the charges as framed in issues no.2 and 6 and these issues are decided against the OL and in favour of respondents. 5.3 Issue no.3 is inconsequential and is decided alongwith issue no.4. 5.4 Issue no. 5.3 Issue no.3 is inconsequential and is decided alongwith issue no.4. 5.4 Issue no. 4 is regarding the amount of Rs.20, 64, 331/- towards stock of raw material, finished goods, packing and other stores and spare stock, which were lying at the factory premises and were required to be handed over to the OL. The allegation is that the respondents have frisked off the said raw material lying at the site. The charge and the issue on perusal of the record is not made out against the respondents-Directors mainly for two reasons. Firstly, the inventory was prepared on 17/03/1993 and the current stock was not included in the same. The current assets were the raw material, consumables/stocks, finished and semifinished goods which were stored in a separate lock and key while when the RIICO took over assets of the factory, the same finds mention in the report (Exhibit-F) . The notarial report dated 17/03/1993 does not make a mention nor the notarial report dated 19/08/1996, which is a joint verification of RIICO, Central Bank of India and M/s. Havells (India) Ltd, mentions about the said current assets. The OL, by way of present application, puts the responsibility on the respondents of the said current assets having not been found in the factory. The same is based on the letter written by the RIICO dated 15/01/1998 mentioning that no record, current asserts were found in the factory unit of the Company in liquidation. The role of RIICO as well as that of the then OL is found to be doubtful in the present case. Once in the inventory prepared in the year 1993, it is mentioned that the current assets are in separate room and the entire factory premises were under the lock & key and security of the RIICO, it cannot be said that the respondents have misappropriated the stocks. A presumption of such a nature cannot be made as neither the OL, after 1995, bothered to take over the said current assets from RIICO nor he was present in the joint verification made by the representatives of RIICO, Central Bank of India and M/s. Havells (India) Ltd. dated 19/08/1996. The amunt of Rs.20, 64, 331/- thus cannot be attributed to the Ex-Directors namely, the respondents herein. The amunt of Rs.20, 64, 331/- thus cannot be attributed to the Ex-Directors namely, the respondents herein. In the normal course, this Court would have taken cognizance against the then OL in terms of Section 543, however, as the then OL is not holding office and the Chartered Accountant, in his report, has also not bothered to take into consideration this aspect of the matter, this Court proposes not to further proceed against the concerned OL but at the same time, this Court does not find any case made out under Section 543 of the Act o 1956 for the issues no.3 & 4 as against the respondents and the same are answered in favour of the respondents. 5.5 So far as the issue no.5 is concerned, the submission of counsel for the OL is that at the time of taking over, as per the statement of affairs, the Company in liquidation was having realizable assets amounting to only Rs.8859/- as balance with Dev Cooperative Bank; Rs.4980/- as share capital in Bombay Mercantile Cooperative Bank in the form of 166 equity shares of Rs.30/- each and Rs.2201/- in the form of deposit with post office but the CA has submitted that the said share certificates in saving bank account number and address of post office were not given to the OL and the said amount could not be realized. In the affidavit, the respondent has stated that the said bank balance and investment has been adjusted by the Bombay Mercantile Bank against their dues as has been mentioned in the statement of affairs. However, taking into consideration the said petty amount, which is lying with the bank and post office for which account number could have been obtained even subsequently, the said issue is dropped as against the respondents and no misfeasance in terms of Section 543 of the Act of 1956 can be said to be deliberately done. 6. Several judgments have been cited at bar by counsel for both the parties. However, taking into consideration the peculiar facts of the case as noted above and having examined all the facts, this Court does not propose to further discuss the same as each and every case is dependent upon the facts and circumstances of that particular case. 7. Consequently, the company application is dismissed.