Liquidator in the course of winding up. For example, based on a statement of affairs to be made under Section 454, he presents a report to the Court under Section 455, takes into his custody the property, affects and actionable claims of the company. He has powers to institute or defend any suit or prosecution, whether civil or criminal, in the name and and on behalf of the company, carry on its business for beneficial winding up, sell property, raise money on the security of any property of the company and do all other things as may be necessary for winding up the affairs of the company and distributing its assets amongst creditors and beneficiaries (Section 457). Subject to the provisions of the Act, the Official Liquidator ascertains the wishes of the creditors and contributories and uses his discretion in the administration of the assets of the company in liquidation and the distribution thereof amongst the latter (Section 460). All these powers to be exercised by the Official Liquidator are, however, subject to the control of the Company Court, though the court may, by order, provide that the liquidator may exercise any of the powers without the sanction or intervention of the court (Section 458). In short, the Official Liquidator is an officer appointed for conducting the winding up of the company under directions and supervision of the Company Court. His position cannot be likened to directors or principal officers of the company insofar as any civil or criminal liability of the company arising prior to the winding up is concerned. Merely because he has the power to defend or prosecute any civil or criminal proceedings for and on behalf of the company in liquidation in respect of any such liability (which has arisen prior to winding up), that too subject to the directions and control of the company court, no court can seek to either prosecute him as a representative of the company or insist on his personal appearance as such representative. In any event, in a case where personal presence of the Official Liquidator may be necessary, either for defending or prosecuting such proceedings, the court, which requires such presence, ought to seek appropriate leave or directions from the Company Court, since all acts of the Official Liquidator in defending or prosecuting proceedings are subject to the control of the Company Court and are with leave of that court. Even in the case of Firth (India) , this Court held that in a rare case “if the Liquidator himself is to be held liable for acts of the Company there is always power in him to seek permission of the Company Court to prosecute or defend such prosecution.” There have been cases where criminal prosecutions have been permitted by this Court against companies in liquidation, but without the official Liquidator being required to remain present personally in the proceedings (See for example, Southern Engineers v. Official Liquidator of Vibha Mechano Electric India Pvt. Ltd.)”
