Thomas vs Catholic Bank of India Ltd.

P. T. Raman Nayar, J.—The proceeding in respect of which leave is now sought u/s 446 of the Companies Act was instituted in July 1964; the winding up order was made much earlier, in October 1961; and this application was brought only in November 1964. The question is whether once a winding up order has been made, leave is a condition precedent to the institution or whether subsequent leave can be granted. Having regard to the purpose of the section, I am inclined to follow the view taken in People''s Industrial Bank, Ltd. Vs. Ram Chander Shukul and Others, , AIR 1942 289 (Lahore) , Krishna Piliai v The Travancore National & Quilon Bank, Ltd. (1943 T. L. R. 458 (F. B.) and Suresh Chandra Khasnabish Vs. The Bank of Calcutta Ltd., that it can, in preference to the view Jaken in AIR 1936 401 (Lahore) , In Re: Steel Construction, Co. Ltd. and Harnarain Misra Vs. Kanhaiyalal Lohawalla and Another, that it cannot. As pointed in Puran Mai v Central Bank of India ( A. I. R. 1953 Punj. 235) the word, "commenced" occurring in the section must, in relation to the words, "suit or other legal proceeding", be understood in the English sense as meaning the issue of process by the court rather than the presentation of the plaint or other paper by which a legal proceeding is instituted-- in other words as observed in Krishna Piliai v Travancore National & Quilon Bank Ltd. (1943 T. L. R. 458 (F. B.) the bar is not against the party instituting the legal proceeding but against the court commencing the adjudication thereof by the issue of process. If that be so, the institution is not affected by the want of leave and the worst that can be said is that any proceeding taken by the court before the Application No. 614 of 1964 in B. C. P. No. 4 of 1961. Decided on 10-2-1965 grant of the leave would be bad, a defect which can be remedied, if necessary, by taking the proceeding afresh after leave has been granted. In this case the petitioner was, on his own showing, aware of the winding up order when he instituted the proceeding in question and he has no excuse whatsoever for not applying for prior leave. Therefore, in allowing this application and granting leave, I impose the following conditions:

(i) That the petitioner do pay the liquidator Rs. 25/- as costs of this application; and

(ii) That he pay the liquidator Rs. 100/- for the latter''s expenses in connection with the proceeding for which leave is now granted. These payments will not be costs in the proceeding in question and the leave will be effective only on the payments being made.