ORDER : 1. Heard learned advocate Ms. Bhoomi Thakore for the applicant and learned advocate Ms.Mohini Bhavsar for learned advocate Mr. K.T. Khatri for respondent no.3. 2. The Official Liquidator by this report has prayed for the following reliefs : “(A) This Hon'ble Court may be pleased to permit the Official to disburse an amount 13,10,421/- as worked out by M/s. P. C. Rathod & Co., Chartered Accountants to 66 workmen represented by Gujarat Labour Federation out of the available fund with the Official Liquidator in Company's A/c through RTGS /NEFT mode directly in the A/c. of the concerned workmen of the company in liquidation. (B) This Hon'ble Court may be pleased to permit the Official Liquidator to encash premature FDR for disbursing amount to ex-workmen of the company in liquidation. (C) This Hon'ble Court may be pleased to permit the Official Liquidator to avail service of empaneled Chartered Accountants for verification of claim forms submitted by workmen of the company in liquidation as the Official Liquidator make payment to the concerned workmen on the basis of verification report submitted by the Chartered Accountants, and as per list provided by the concerned worker's union as well claim forms submitted by concerned workers/workers' union. (D) This Hon'ble Court may be pleased to direct Gujarat Labour Federation, authorized representative of workmen to prepare Master Payment Register as per usual practice and supply duly attested copy of the same to the Office of the Official Liquidator so as to enable the Official Liquidator to process the dully filled up claim forms with the help of Chartered Accountants and after verification same may be forwarded to the Bank to make the payment in the account of concerned workmen through RTGS/NEFT mode only. (E) This Hon'ble Court may be pleased to direct Gujarat Engineering & General Kamdar Union immediately lodge claim of 03 workmen of their union so as to enable the Official Liquidator to verify and adjudicate their claim and after adjudication release their payment at par along-with workmen represented by Gujarat Labour Federation. (F) This report is submitted for such other and further orders and directions as may be considered appropriate by this Hon'ble Court may also be passed.” 3. (F) This report is submitted for such other and further orders and directions as may be considered appropriate by this Hon'ble Court may also be passed.” 3. This Court by order dated 30.04.2018 passed in Official Liquidator Report No. 1/2017 has permitted the Official Liquidator to invite the claim under section 530 of the Companies Act, 1956 (For short “the Act”) by publishing the advertisement in the newspapers. In compliance of the said order, the Official Liquidator published the advertisement in newspaper on 18.05.2018. 4. The Official Liquidator by letter dated 24.05.2018 invited the claims from secured creditors as well as Union of workers. 5. Gujarat Engineering & General Kamdar Union by letter dated 9.07.2018 raised grievances regarding three claims of the workmen of their Union under section 529A of the Act. The Official Liquidator by letter dated 26.07.2018 informed the Union that the claim of the workmen has already been finalised and the same are paid pursuant to the order passed by this Court on 23.12.2014 in OLR No.89/2014. 6. M/s. P.C. Rathod & Co., Chartered Accountants vide letter dated 18.12.2019 forwarded claim verification report of workmen and IDBI Bank Ltd. as under : (A) WORKMEN Sr. No. Particulars Preferential Claims (Rs.) Unsecured Claims (Rs.) Total Claims 1. Interest Due 13,10,421/- 12,03,645/- 25,34,066/- 2. Notice Pay, Bonus, Special Allowance -- 6,24,514/- 6,24,514/- 13,10,421/- 18,28,159/- 31,58,580/- (B) IDBI BANK LTD Sr. No. Particulars Preferential Claims (Rs.) Unsecured Claims (Rs.) Total Claims 1. Lease Rentals 0 4,42,08,761/ - 4,42,08,761/ - 0 1,08,58,419/ - 1,08,58,419/ - 0 5,50,67,180/ - 5,50,67,180/ - 7. The Official Liquidator thereafter received a letter dated 31.12.2019 from Gujarat State Labour Federation accepting the report of the Chartered Accountants so far as claim of the workmen is concerned. However, IDBI Bank Ltd. vide letter dated 6.01.2020 raised objections against the report of the Chartered Accountant for not considering the claim of IDBI Bank Ltd. for interest upon lease rental. The Official Liquidator forwarded the said letter to the Chartered Accountant. However, the Chartered Accountant reiterated the entitlement of IDBI Bank Ltd. as per the provisions of the Act with regard to the payment of interest at the rate of 4% from the date of order of liquidation. The Official Liquidator forwarded the said letter to the Chartered Accountant. However, the Chartered Accountant reiterated the entitlement of IDBI Bank Ltd. as per the provisions of the Act with regard to the payment of interest at the rate of 4% from the date of order of liquidation. The Official Liquidator has reported that on the date of filing of this OLR as on 17.09.2020, there was total fund of Rs.1,11,18,802/- available in the bank account and FDR in the account of the company. 8. IDBI Bank Ltd. has filed affidavit in reply to the aforesaid report contending that IDBI is entitled to receive interest under section 530(2) of the Act read with Rule 179 of the Companies (Court) Rules, 1959 (For short “the Rules”). Copy of the Master lease agreement is also placed on record to point out that as per the terms of the said agreement, interest is payable to IDBI Bank Ltd. upon the outstanding lease rental. 9. The Official Liquidator by further report dated 9.11.2022 has stated as under : “(2) That, the Official Liquidator most respectfully submits that in response of the aforesaid letter, M/ s. P. C. Rathod & Co., Chartered Accountants vide its letter dated 26.08.2022 forwarded its revised claim verification report wherein said Chartered Accountants mentioned that the office of the Official Liquidator realized sale consideration from the immovable assets of the company in liquidation and secured creditors is having charged only over the movable assets of the company in liquidation and the office of the Official Liquidator has not realized any amount from the sale of movables asset of the company in liquidation since same were not available on site at the time of taking over the possession by the Office of the Official Liquidator. (3) M/s. P. C. Rathod & Co., Chartered Accountants further point out towards para (10) of the order dated 03.09.2013 passed in OLR No. 04 of 2013, which is reproduced as under:- "Mr. (3) M/s. P. C. Rathod & Co., Chartered Accountants further point out towards para (10) of the order dated 03.09.2013 passed in OLR No. 04 of 2013, which is reproduced as under:- "Mr. Bhagat learned advocate for IDBI candidly admitted that the secured creditors do not have charge so far as immovable property is concerned, however, IDBI had charge over certain movables which aspect is noticed by the Chartered Accountants also it also emerged from the record that IDBI has not taken possession of the machinery /movable over which it has a charge" (4) M/s. P. C. Rathod & Co., Chartered Accountants also point out that the Hon'ble High Court vide order dated 18.02.2014 passed in OLR No. 119 of 2013 also observed that all the three secured creditors were having charge over the movable assets only and sale proceeds received only from the immovable assets of the company in liquidation. Hence, directed the Official Liquidator to disburse an amount of *70,31,045/- to workmen of the company in liquidation under Section 529 of the Companies Act, 1956. A copy of order dated 18.02.2014 passed in OLR No. 119 of 2013 is annexed herewith and marked as Annexure "B". (5) Hence, the Chartered Accountants has opined that IDBI Bank Ltd., created for *277/- Lakh only on originally granted limit and therefore, they need to calculate proportionately leased rentals for an original limit of *277/- Lakh. Accordingly, an amount of 2452.13 lakh considered as eligible claim of IDBI Bank Ltd., and considering the said eligible amount and applicable interest thereon, Chartered Accountants has adjudicated an amount of 25,50,66,433/- towards unsecured claim under Section 530 of the Companies Act, 1956 of IDBI Bank Ltd., A copy of revised report dated 25.08.2022 is annexed herewith and marked as Annexure "C". (6) That, on receipt of said report, the Official Liquidator vide letter dated 30.08.2022 forwarded a copy of the said letter IDBI Bank Ltd., to seek their opinion/comments of the said letter. in response of the letter, the IDBI Bank Ltd., has vide letter dated 17.09.2022 again raised objections on the claim verification report submitted by Chartered Accountants. A copy of letters dated 30.08.2022 and 17.09.2022 are annexed herewith marked as Annexure "D" (Colly.).” 10. in response of the letter, the IDBI Bank Ltd., has vide letter dated 17.09.2022 again raised objections on the claim verification report submitted by Chartered Accountants. A copy of letters dated 30.08.2022 and 17.09.2022 are annexed herewith marked as Annexure "D" (Colly.).” 10. Having heard the learned advocates for the respective parties, it appears that the Chartered Accountant has considered the claims raised by IDBI Bank Ltd. in the report submitted on 18.12.2019. Chartered Accountant has opined with regard to the claim of interest by IDBI as under : “A. Report on Claim of Interest Representatives of the IDBI Bank have claimed Interest at 24% rate p.a. on compounding basis with monthly rests, on all payments paid by IDBI Bank as allowed u/s 530 of the Companies act, 1956. Further, the representatives have calculated Interest on the entire claim amount from the respective date(s) of payment(s) incurred till the reimbursement thereof. Representatives of the IDBI Bank have also claimed Interest at 21% rate p.a. in respect of advances or other payments made and all costs, charges and expenses paid by the IDBI Bank towards the purchase of the equipment commencing from the respective date(s) for such payment upto the commencement date for rental. Such compensatory finance charges shall be payable quarterly on the 1st day of April, July, October and January as allowed u/s 530 of the Companies act, 1956. While allowing the claim of Interest, as per Rule 179 of the Companies (Court) Rules, 1959, we have considered Interest @ 4% as unsecured creditors. Further, we have considered an amount as an eligible interest from the date of winding up to the date of claim of IDBI Bank i.e. the date of Proof of Debt (07.01.2010). The Interest so calculated is only for the payment of Interest made for all payment made by IDBI Bank on behalf of the GUJARAT RODREL ENGG PRODUCTS LTD (In Liqn.). Interest on Advances and other payment made and all costs, charges and expenses paid by the IDBI Bank is not allowed as creditors. In case of Lease rentals, IDBI Bank had created and registered charge of Rs. 277/- Lakhs. But as per Proof of Debt the modification in the Leased facility was made for Rs. 297.27/- Lakhs. This modification in charge was not registered with ROC. From the above and report of Mukund Patel & Co. In case of Lease rentals, IDBI Bank had created and registered charge of Rs. 277/- Lakhs. But as per Proof of Debt the modification in the Leased facility was made for Rs. 297.27/- Lakhs. This modification in charge was not registered with ROC. From the above and report of Mukund Patel & Co. IDBI Bank is entitled to the repayment of lease rentals only for the originally sanctioned amount of Rs. 277/- Lakhs, for which charge is registered with The R.O.C.. Therefore proportionately lease rentals payment to be made is of Rs. 452.16/- Lakhs out of which Rs.10.05/- Lakhs were paid by the company on 23.05.1994 & Our calculation of Lease Rentals and Interest allowed to IDBI Bank u/s 530 of the Companies act, 1956 from the above comes to Rs. 4,42,08,761/- plus interest @ 4% as per Court rule 179, Rs. 1,08,57,672/ is considered as unsecured creditors and balance interest claim amount by IDBI Bank amounting to Rs. 21,53,48,893/- is disallowed. working is attached as per Annexure 2.” 11. Chartered Accountant has reiterated above observations in his clarificatory report dated 26.08.2022 as under : “As per Information received from the office of The Official Liquidator, The O.L. has received the amount only from sale of Immovable assets of the company under Liquidation. i.e. from sale of Land only, over which, The IDBI Bank was not having any charge. (IDBI Bank was having charge over Plant and machinery and other movable assets only). As per Information given by IDBI Bank, IDBI Bank had given loan to the erstwhile company, M/s Gujarat Rodrel Engg. Product Ltd on hypothecation of Machinery and other movable assets, However The office of the Official Liquidator has not realized any amount from the same since said machinery and movable assets were stolen ( Not available at site) at the time of taking over the possession by the Office of The Official Liquidator. As per order dated 18.02.2014 passing OLR no.119 of 2013 Honorable High Court has already observed that all 3 secured creditors Dena Bank, GIIC and IDBI Bank) have charge over the movable assets of the company under Liquidation. And in light of the aforesaid para 1 to 3 of OLR no. 119 of 2013 and as all the three secured creditors have no objection, Official Liquidator is directed to disburse the amount of Rs.70,31,045/- in favour of the workmen. And in light of the aforesaid para 1 to 3 of OLR no. 119 of 2013 and as all the three secured creditors have no objection, Official Liquidator is directed to disburse the amount of Rs.70,31,045/- in favour of the workmen. Thus at the time of settlement of workers dues of company to which IDBI Bank was party to that settlement under section 529 on the basis of the report of Chartered Accountant and IDBI Bank had not raised any objection at the time of disbursement u/s 529. Further we bring to your notice order dated 03.09.2013, OLR 4 of 2013 and more particularly paragraph number 10 which is reproduced below: 10. Mr. Bhagat, learned advocate for IDBI candidly admitted that the secured creditors do not have charge so far as immovable property is concerned, however, IDBI had charge over certain movables which aspect is noticed by the Chartered Accountant also and it also emerges from the record that IDBI has not taken possession of the machinery/movable over which it has a charge." Now it is very clear from above points and respective orders of court, that The Official Liquidator has received the amount only from sale of Immovable assets i.e." Land" of the company under Liquidation. IDBI Bank is not having any charge over immovable assets i.e. "Land" of the Company under Liquidation as it had charge over machinery and movable assets only as per their own admission repeatedly at various court hearings. As per information provided by The IDBI Bank Ltd., they have given loan to erstwhile company, "Gujarat Rodrel Engg. Product Limited (In Liqn.) on hypothecation of Plant and Machinery and Other Movable assets of the company. However Official Liquidator had not realized any amount from Plant, Machinery and other movable assets since the said machinery and movable assets were stolen (Not available) at the time of taking over possession by The office of The Official Liquidator. Charge was also created forRs.277/- lakh only on originally granted limit and therefore we need to calculate proportionately lease rentals for an original limit of Rs.277/- lacs. And as per their report the claim of Rs.452.13 Lakh was an eligible claim. On the same lines we have also considered claim for Lease rentals of Rs.452.13 lakh as an eligible claim. Charge was also created forRs.277/- lakh only on originally granted limit and therefore we need to calculate proportionately lease rentals for an original limit of Rs.277/- lacs. And as per their report the claim of Rs.452.13 Lakh was an eligible claim. On the same lines we have also considered claim for Lease rentals of Rs.452.13 lakh as an eligible claim. Therefore, from the above we conclude that the claim amount eligible would be same as granted earlier, i.e. total claims of the IDBI Bank for GUJARAT RODREL ENGG PRODUCTS LTD (In Lign.) in respect of lease rentals and interest and other charges due as determined in the report u/s 530 of the Companies Act, 1956 and eligible claims against Lease rentals and Interest and other charges as under : Sr. No. Particulars Preferential Creditors Rs. Unsecured Creditors Rs. Total Claims Rs. 1. Lease Rentals and Interest claim approved by earlier reports 0 4,52,13,534/- 4,52,13,534/- Less: Lease Rental already paid 10,04,773/- 10,04,773/- Net Lease Rentals 0 4,42,08,761/- 4,42,08,761/- 2. Interest & Others 0 1,08,57,672/- 1,08,57,672/- Total Rs. 0 5,50,66,433/- 5,50,66,433/- 12. Learned advocate for IDBI Banks Ltd. submitted that as per the terms of Master circular, IDBI Bank Ltd. is entitled to get interest more than what is finalised by the Chartered Accountant. It was submitted that the Master lease agreement dated 25.10.1993 inter-alia provides that without affecting the lessee’s obligation to pay the amounts above and in addition to the right of the lessor specified in clause 8 thereof, all arrears of the amounts payable under or pursuant to the said agreement shall carry interest at the rate specified in clause 2.7 on compounding basis with monthly rests from the respective due dates till the date of actual payment thereof by the lessee. It was submitted that considering such clause, the IDBI Bank Ltd. is entitled to receive the amount of interest till the date of winding up order. It was submitted that Chartered Accountant has not considered the clause of payment of interest in the Master lease agreement and as per the contractual terms, restricted the claim of bank only to the extent of outstanding lease rental which is against the principles of contract. It was submitted that in such circumstances, IDBI Bank Ltd. is entitled to get the claim raised by it before the Official Liquidator amounting to Rs.42,79,52,627/-. 13. It was submitted that in such circumstances, IDBI Bank Ltd. is entitled to get the claim raised by it before the Official Liquidator amounting to Rs.42,79,52,627/-. 13. These submissions made on behalf of IDBI Bank Ltd. is not tenable in view of provisions of Rule 179 of the Rules which reads as under: “179. Payment of subsequent interest.- In the event of there being a surplus after payment in full of all the claims admitted to proof, creditors whose proofs have been admitted shall be paid interest from the date of the winding-up order or of the resolution as the case may be, up to the date of declaration of the final dividend, at a rate not exceeding 4 per cent per annum, on the admitted amount of the claim, after adjusting against the said amount the dividends declared as on the date of the declaration of each dividend.” 14. As per the said Rules, the interest is payable at the rate of 4% from the date of winding up order and therefore, claim of IDBI Bank Ltd. is not tenable in view of the provisions of Rule 179 of the Rules. The calculations made by Chartered Accountant is in accordance with the provisions of the Act and the Rules framed thereunder and therefore, no interference is called for in the said calculation made by the Chartered Accountant. 15. In view of above, the Official Liquidator is directed to disburse the amount to the creditors as per the report of the Chartered Accountant within four weeks from today on receipt of usual undertaking to be furnished before the Official Liquidator by the respective creditors. 16. The Official Liquidator Report is accordingly disposed of.