ORDER : 1. The Official Liquidator attached to this High Court filed administrative report and requested to take it on record and further sought permission to refund/return EMD/part sale consideration of Rs.29 Lakhs to Sri P. Vijaya Saradhi Raju (highest bidder for lot No. 5) pursuant to the orders dated 22.04.2016 in CA. No. 1555 of 2008 of this Court from and out of the fund of Rs.9,50,000/- available in companies account and Rs.19,50,000/- from and out of the “Estate and Establishment Fund Account” maintained by the Official Liquidator, subject to recruitment of the sale against the sale proceedings of the assets of the company (in liqn.). 2. The Company Application No. 4 of 2024 is filed to direct the respondent herein to return the EMD amount of Rs.29,00,000/- along with interest @ 6% per annum for the date of deposit to till the date of payment. 3. The administrative permission sought by the Official Liquidator is heard on the bench along with COMP Appeal No. 4 of 2024 as per the order dated 30.04.2024 on administrative side. The facts leading to the seeking above relief as briefly as follows: By an order dated 04.12.2006 in C.P. No. 128 of 2005 this Court directed the widening up of M/s. Vijetha Agro Farms (India) Limited and appointed the Official Liquidator in terms of Section 449 of the Companies Act, 1956. By an order dated 02.12.2008 in C.A. No. 1555 of 2008, this Court permitted the Official Liquidator to sell all the assets of the company (In Liqn). In response to the sale notice, fixing the date of auction as 24.12.2008, the Official Liquidator received certain sealed tenders, including that of Sri. P. Vijaya Saradhi Raju for lot Nos. 5, 8 & 10. He deposited the EMD amount of Rs.20 Lakhs for lot No. 5, Rs.7 lakhs for lot No. 8 and Rs.5 lakhs for lot No. 10. Thereafter, the auction was conducted on 24.12.2008. The EMD amounts in respect of lot Nos.8 and 10 were returned to him since he became the unsuccessful bidder in the said lots. With regard to the lot No. 5, he became the highest bidder with an offer of Rs.3,29,00,000/- to purchase land to an extent of Ac.120.42 cents situated in Thimmayapalem Village, Vinukonda Mandal, Guntur District. The EMD amounts in respect of lot Nos.8 and 10 were returned to him since he became the unsuccessful bidder in the said lots. With regard to the lot No. 5, he became the highest bidder with an offer of Rs.3,29,00,000/- to purchase land to an extent of Ac.120.42 cents situated in Thimmayapalem Village, Vinukonda Mandal, Guntur District. Vide order dated 03.03.2009 in C.A. No. 1555 of 2008 passed by this High Court, the sale was confirmed in favour of Sri. P. Vijaya Saradhi Raju. Accordingly, the Official Liquidator issued a letter dated 05.03.2009 to him informing the orders of the High Court and advised him to remit the balance sale consideration of Rs.3,09,00,000/- after adjustment of the EMD amount of Rs.20,00,000/- as per the terms and conditions. He remitted an amount of Rs.9,00,000/- vide his letter dated 26.03.2009 towards part of the sale consideration and informed that he would remit the balance sale consideration within six months. The same was informed to this Court through a report of Official Liquidator vide OLR No. 139 of 2009 dated 02.04.2009. However, he has not paid the balance sale consideration within the time requested. Meanwhile, some third parties filed certain applications before this Court and claimed the title over the properties sold by the Official Liquidator. Vide final order dated 22.04.2016 passed by this Court, the sale conducted by the Official Liquidator was terminated with a further direction to return the EMD amount available, within two weeks from the date of receipt of the copy of the order. Pursuant thereto, the Official Liquidator returned all the EMD amounts to the highest bidders, who raised the claim, except P. Vijaya Saradhi Raju. Thus, the amount of Rs,29,00,000/- (EMD of Rs.20,00,000/- + part of the sale consideration of Rs.9,00,000/-) is still lying with the office of the Official Liquidator. Another application vide C.A. No. 621 of 2016 was filed by the Official Liquidator before this Court seeking permission for conducting fresh sale of the properties of the company (in liqn.) and the same is pending before this Court. P. Vijaya Saradhi Raju, vide letter dated 14.03.2024 (received on 15.03.2024) and letter dated 24.12.2023 (received on 04.01.2024) requested the Official Liquidator to return the amount of Rs.29,00,000/- with interest @ 6% p.a. from the date of remittance till the date of the order of the High Court i.e. 22.04.2016. P. Vijaya Saradhi Raju, vide letter dated 14.03.2024 (received on 15.03.2024) and letter dated 24.12.2023 (received on 04.01.2024) requested the Official Liquidator to return the amount of Rs.29,00,000/- with interest @ 6% p.a. from the date of remittance till the date of the order of the High Court i.e. 22.04.2016. Previously, the Official Liquidator returned the EMD amounts with interest to two bidders pursuant to the orders of this Court dated 22.04.2016 in C.A. Nos. 1595 & 1596 of 2016and paid the principal amount of EMD only to six highest bidders (i.e. without any interest). The Official Liquidator utilized the funds lying in the credit of the company (In Liqn.) towards security charges for certain period, which includes the EMD amount of P. Vijaya Saradhi Raju. Pursuant to the order of this Court dated 18.04.2009 in C.A. No. 316 of 2009, the office of the Official Liquidator is utilizing the funds lying to the credit of “Estate and Establishment Fund Account” maintained by the Official Liquidator towards security charges due to non-availability of sufficient funds in the company’s account and till date the watch & ward expenses of M/s. Vijetha Agro Farms (India) Ltd (In Liqn.) have been paid from and out of the funds of “Estate and Establishment Fund Account.” As on 14.03.2024,an amount of Rs.9,94,571.45 ps is lying to the credit of the company (In Liqn.) and an amount of Rs.4,66,65,706.71 ps is lying to the credit of ‘Estate and Establishment Fund Account” maintained by the Official Liquidator. Therefore, the Official Liquidator sought permission to refund the EMD amount and part payment of sale consideration, a total of Rs.29,00,000/- to P. Vijaya Saradhi Raju as detailed above and to make such payment out of the fund of the company’s account to an extent of Rs.9,50 lakhs and out of the “Estate and Establishment Fund Account” amount of Rs.19.50 Lakhs. The copies of the following documents are annexed. 1. Administrative Report of the Official Liquidator. 2. Office copy of the letter dated 05.03.2009 sent to Sri P. Vijaya Saradhi Raju. (Annexure-A). 3. Copy of the letter dated 26.03.2009 received from Sri P. Vijaya Saradhi Raju, (Annexure-B). 4. Copy of the Hon’ble High Court order darted 22.04.2016 passed in C.A. No. 1555/2008 (Annexure-C). 5. Copies of the letters dated 14.03.2024 and 24.13.2023 received from Sri P. Vijaya Saradhi Raju (Annexure-D). 6. (Annexure-A). 3. Copy of the letter dated 26.03.2009 received from Sri P. Vijaya Saradhi Raju, (Annexure-B). 4. Copy of the Hon’ble High Court order darted 22.04.2016 passed in C.A. No. 1555/2008 (Annexure-C). 5. Copies of the letters dated 14.03.2024 and 24.13.2023 received from Sri P. Vijaya Saradhi Raju (Annexure-D). 6. Copy of the Hon’ble High Court order dated 17.06.2008 made in C.A. No. 229/2008 (Annexure-E). 7. Copy of the Hon’ble High Court order dated 18.04.2009 made in C.A. No. 316/2009 (Annexure-F). On 31.07.2024, the Official Liquidator further filed administrative report along with the following documents: 1. Administrative Report of the Official Liquidator dated 31.07.2024. 2. Copy of the C.A. No. 320/2000 and Court order dated 13.10.2000 are enclosed and marked as Annexure-A. 3. Copy of the order dated 05.03.2012 made in C.A. No. 24/2012 in enclosed and marked as Annexure-B. 4. Copy of the order dated 22.04.2016 made in C.A. No. 1555/2008 is enclosed and marked as Annexure-C. 5. Letters dated 14.03.2024 and 24.12.2023 received from Sri P. Vijaya Saradhi Raju are enclosed and marked as Annexure-D. 6. Copy of the order dated 17.06.2008 made in C.A. No. 229/2008 is enclosed and marked as Annexure-E. 7. Copy of the order dated 18.04.2009 made in C.A. No. 316/2009 is enclosed and marked as Annexure-F. 8. Copy of the Administrative Report No. 10/2024 are enclosed and marked as Annexure-G and H. 4. In the report dated 31.07.2024, the Official Liquidator stated that the Official Liquidator has to take possession of the assets, prepare inventory of books of accounts and records etc upon winding up of company by an order of High Court in pursuance of Sections 449 and 450 of the Companies Act, 1956, but due to meagre strength of the government staff, the Official Liquidator is recruiting company paid staff in pursuance of rule 308 of the Companies (Court) Rules, 1959 with the approval of the concerned High Court and paying their salaries from the funds of the companies (in liqn.). It is further stated that though the company paid staff were recruited to pay from the fund of the particular company, they are being utilized for the liquidation proceedings of the various companies. It is further stated that though the company paid staff were recruited to pay from the fund of the particular company, they are being utilized for the liquidation proceedings of the various companies. As such, since the fund of company cannot be utilized for other companies, the Official Liquidator in other states such as Tamil Nadu, Kerala and Karnataka, took the matter before their High Courts to implement a system of 30% of the total interest earned on deposit invested by the Official Liquidator to be kept in “Estate and Establishment Fund Account.” Accordingly, various High Courts approved that such system for effective and easy functioning. Likewise, before this High Court vide C.A. No. 320 of 2000, a similar permission was ordered to deposit 30% of the total interest earned on the fixed deposit in Andhra Bank (presently Union Bank of India), Kendriya Sadan Extension, Kendriya Sadan, Koti, Hyderabad, to meet out the salaries of Company Paid Staff, to pay the monthly rental and also to incur such expenditure in the liquidation proceedings. Pursuant thereto, a bank account was opened in the name of “Estate and Establishment Fund” in the above said bank. The process of crediting an amount of interest in the said fund was followed till March, 2012. Subsequently, the High Court, vide order dated 05.03.2012 in C.A. No. 24 of 2012 directed the Official Liquidator to forthwith discontinue crediting the interest into the said fund as there was an amount exceeding Rs.18.42 crores and permitted to seek similar relief in future, if the amount in the fund is fully exhausted. As on date, an amount of Rs.3.93 crores is available in the said fund. Due to non-availability of fund in the account of M/s. Vijetha Agro Farms (India) Limited (in liqn.) the Liquidator is utilizing the funds lying to the credit of the above said fund for liquidation expenses. 5. Therefore, the Official Liquidator sought permission to pay Rs.19.50 lakhs, as aforesaid to. P. Vijaya Saradhi Raju out of the above said fund, in addition to the balance amount to be paid out of the amount lying to the credit of the company (in liqn.) 6. On 28.08.2024, the Official Liquidator submitted a supplementary administrative report along with statement showing the realization and disbursement of the subject company from the date of winding up order dated 13.03.2024 which is authorized by the Chartered Accountant. 7. On 28.08.2024, the Official Liquidator submitted a supplementary administrative report along with statement showing the realization and disbursement of the subject company from the date of winding up order dated 13.03.2024 which is authorized by the Chartered Accountant. 7. The learned Standing Counsel for the Official Liquidator submitted that the rule 292 of the Companies (Court) Rules, 1959 as follows: “Where a company against which a winding-up order has been made has no available assets, the Official Liquidator may, with the leave of the Court, incur any necessary expenses in connection with the winding-up out of any permanent advance or other fund provided by the Central government, and the expenses so incurred shall be recouped out of the asset of the company in priority to the debts of the company: Provided that there any money has been advanced to the Official Liquidator by the petitioning or other creditor or contributory for meeting any preliminary expenses in connection with the winding-up, the Official Liquidator may incur any necessary expenses out of such amount, and the money so advanced shall be paid out of the assets of the company in priority to the debts of the company.” 8. However, due to stoppage of the financial assistance from the Central Government, as aforesaid, various High Courts started permitting creating of fund. Thus, “Estate and Establishment Fund Account” was created in the state of A.P. He further stated that the amount whatever is paid out of the Estate and Establishment of Fund would be reimbursed on securing the amount of sale consideration on sale of the properties of the company (in liqn.) and thus, the order of the High Court for refund of EMD and the amount of part payment of sale consideration paid would be duly complied without committing any financial irregularity. He further referred to rule 9 of the Companies (Court) Rules, 1959 stating that this Court has inherent power like under Section 151 C.P.C. Rule 9 reads as follows: “Nothing in these rules shall be deemed to limit or otherwise affect the inherent powers of the Court to give such directions or pass such orders as may be necessary for the ends of justice or to prevent abuse of the process of the Court.” 9. The learned counsel for the petitioner submitted that P. Vijaya Saradhi Raju requested to grant simple interest @ 6% p.a. on the amount payable. 10. The learned counsel for the petitioner submitted that P. Vijaya Saradhi Raju requested to grant simple interest @ 6% p.a. on the amount payable. 10. The learned Standing Counsel for the Official Liquidator submitted that the petitioner is not entitled to interest, because the petitioner committed default in making payment of deposit of balance amount of sale consideration and also because he has not claimed the refund of the amount till recently when he sent a letters dated 24.12.2023 and 14.03.2024 to Official Liquidator and subsequently filed company application No. 4 of 2024 on 07.05.2024 before this Court. Therefore, he vehemently opposed grant of any interest. In addition, thereto, he submitted that this Court did not order for refund of EMD amount ‘with interest’. 11. In reply, the learned counsel for the petitioner submitted that when the Court asked to enhance the bid amount beyond the amount for which the auction was knocked down as highest bidder, P. Vijaya Saradhi Raju sought some more time to pay the enhanced value, and therefore, there was no delay on his part in making payment of the balance amount of the sale consideration, however, the sale was cancelled. He further stated that, since the Official Liquidator exhausted the amount of EMD and part sale consideration paid by P. Vijaya Saradhi Raju, it is appropriate to grant interest at appropriate rate. 12. In reply, the learned Standing Counsel for Official Liquidator stated that, apart from the delay in making the payment of the balance amount of the sale consideration, there were claims made by the third parties which were already recorded and ultimately the sale was set aside by the order of the Court with a direction to refund the EMD amount and the part payment made, and thereafter, P. Vijaya Saradhi Raju remained silent till he had sent 1st letter in December, 2023 and later one more letter and filing of C.A. No. 4 of 2024. He further submitted that the amount of EMD was consumed only after exhausting the amount in credit to the company (in liqn.) and therefore the amount of EMD was not initially appropriated by the Official Liquidator. 13. He further submitted that the amount of EMD was consumed only after exhausting the amount in credit to the company (in liqn.) and therefore the amount of EMD was not initially appropriated by the Official Liquidator. 13. Though the refund of the amount was ordered by the High Court way back in 2016, since P. Vijaya Saradhi Raju has not claimed the refund of the amount, for his latches, no interest can be directed to be paid from the date of deposit or from the date of order of the High Court. However, since the amount was not refunded from the date of first raising claim for refund vide letter dated 24.12.2023, it is appropriate to direct payment of interest on the amount payable towards refund of EMD + part payment of sale consideration. The rate of interest @ 6% p.a. on the balance of amount now payable to P. Vijaya Saradhi Raju would be appropriate. The Official Liquidator shall reimburse the amount in the “Estate and Establishment Fund Account.” 14. Accordingly, the Company Application No. 4 of 2024 is allowed and the respondent is directed to pay the petitioner Rs.29,00,000/- with interest @ 6% p.a. on the said amount from 24.12.2023 till date of payment. Further, the respondent is permitted to make such payment for Rs.9,50,000/- from out of the companies account and the rest of the amount of Rs.19,50,000/- and the whole amount of interest from out of the “Estate and Establishment Fund Account.” No costs. 15. Miscellaneous petitions, if any, pending shall stand closed, and interlocutory orders, if any, pending shall stand vacated.