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Dr Sailendranath Sinha & Another v. Jasoda Dulal Adhikary & Another
Factual and Procedural Background
The Bank of Commerce Ltd. was ordered to be wound up by the Calcutta High Court on 7 August 1950. An Official Liquidator was first appointed (G.K. Dutt) and later replaced by the Official Receiver. Acting on materials obtained during winding-up, the Liquidator authorised his assistant (Respondent 1) to lodge a criminal complaint on 23 July 1952 before the Presidency Magistrate against two past directors—Appellant 1 (a former director) and Appellant 2 (the former Managing Director). The complaint invoked Sections 120-B, 406, 467, 477-A IPC and Section 182-A of the Companies Act.
The appellants argued before the Magistrate that the complaint was incompetent because, under Section 237(1) of the Indian Companies Act, a prior judicial direction by the Company Court was required. The Magistrate rejected the plea on 13 June 1953. A petition to quash the proceedings was then filed in the Calcutta High Court; the Chief Justice and P.B. Mukherji J. dismissed it on 21 June 1954, holding that Section 237(1) posed no bar and that proper directions had, in any event, been given. Special leave to appeal was refused by the High Court but granted by the Supreme Court, leading to the present appeal.
Legal Issues Presented
- Whether, in a compulsory winding-up, the Official Liquidator must obtain a prior judicial direction under Section 237(1) of the Indian Companies Act before instituting criminal proceedings against past directors.
- Whether an alleged offender is entitled to be heard by the Company Judge before such a direction is issued.
- Whether failure to obtain such a direction renders the ensuing criminal prosecution ab initio void.
Arguments of the Parties
Appellants’ Arguments
- Section 237(1) is mandatory; without a prior direction, any complaint by the Liquidator is ultra vires and void.
- The proviso to Section 237(6), which obliges the Registrar to hear the accused before prosecution, implies that the Company Judge must similarly give the accused an opportunity to be heard before issuing directions.
- Because Section 237 provides a specific statutory procedure, the principle in Nazir Ahmad v. Crown applies: the act must be done in that manner or not at all.
- English authorities—e.g., Queen v. Cubitt, Taylor v. Taylor, and In re Northern Counties Bank Ltd.—support a restrictive construction requiring sanction.
Respondents’ Arguments
- Section 179(a) expressly empowers the Liquidator, with the Court’s sanction, to institute or defend proceedings; no further condition is imposed by Section 237(1).
- Section 237(1) confers an additional power on the Court to direct prosecution; it is not a condition precedent to the Liquidator’s own power under Section 179.
- The proviso to Section 237(6) concerns a different route (through the Registrar) and has no bearing on directions under Section 237(1).
- Previous orders of Buchawat J. (15 January 1951) under Section 179 and Bannerji J. (22 July 1952) under Section 237(1) in fact authorised the Liquidator, so the prosecution is valid even on the appellants’ own theory.
- Indian precedent—e.g., Jaswantrai M. Akhaney v. State of Bombay, Emperor v. Bishan Sahai, and Mrityunjoy Chakravarti v. Provat Kumar Pal—upholds the Liquidator’s competence to prosecute without prior sanction.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Jaswantrai Manilal Akhaney v. State of Bombay (1956) SCR 483 | Section 179 contains no words restricting criminal courts from entertaining prosecutions initiated by a liquidator. | Relied upon to show that prosecutions can proceed without special sanction and that Section 179 imposes no bar. |
| Basdeo Aggarwalla v. King Emperor (1945) FCR 93 | Illustration of a statute where explicit prior sanction was mandatory. | Cited to contrast statutes that do contain prohibitory language; Court noted such language is absent in Section 179/237. |
| Emperor v. Bishan Sahai ILR (1937) All 779 | Companies Act does not require judicial directions before prosecution. | Supported respondent’s position that absence of sanction does not vitiate proceedings. |
| Mrityunjoy Chakravarti v. Provat Kumar Pal AIR 1953 Cal 153 | Neither Section 179 nor Section 237 invalidates a prosecution begun without court direction. | Used as persuasive authority to uphold validity of complaint. |
| Queen v. Cubitt (1889) 22 QBD 622 | Statutory scheme that only specific officers may prosecute. | Cited by appellants; distinguished because Section 237 lacks comparable limiting words. |
| Taylor v. Taylor (1875) 1 Ch 426 | When a statute prescribes a mode, that mode is exclusive. | Appellants relied; Court held the Companies Act prescribes no exclusive mode for prosecutions in compulsory winding-up. |
| Nazir Ahmad v. Crown (1936) LR 63 IA 372 | Doctrine that an act must be done in the prescribed manner or not at all. | Distinguished on the ground that Section 237(1) does not prescribe an exclusive procedure. |
| In re Northern Counties Bank Ltd. (1883) 31 WR 546 | Court’s discretion when prosecution expenses fall on company assets. | Shown to deal with costs, not with competence to prosecute. |
| In re London and Globe Finance Corporation (1903) 1 Ch 728 | Guidelines for court when deciding whether to order a prosecution. | Cited; Court held it does not impose a hearing requirement before directions are issued. |
| In re Charles Denham & Co. Ltd. LT 570 | Observation that a judicial finding under a similar provision should not prejudice the accused at trial. | Noted while discussing the nature of directions under Section 237. |
Court's Reasoning and Analysis
Justice Kapur, delivering the opinion, adopted a textual approach to Section 237:
- Separate spheres of Sections 179 and 237. Section 179 outlines the Liquidator’s powers, including instituting prosecutions with the Court’s sanction; Section 237 empowers the Court to direct prosecution but does not create a pre-condition.
- Absence of prohibitory language. Unlike statutes considered in Basdeo Aggarwalla or Sections 196/197 CrPC, Section 237 lacks words such as “no court shall take cognizance,” indicating no legislative intent to bar prosecutions without direction.
- Registrar proviso inapposite. The obligation of the Registrar under Section 237(6) to hear the accused applies only when the matter is referred to the Registrar, not when the Court empowers the Liquidator to prosecute directly.
- No mandatory hearing before direction. English authorities cited by appellants relate to cost-control or ethical considerations, not to a jurisdictional bar. The Court concluded that a Judge may act ex parte when issuing directions.
- Even on appellants’ premise, directions existed. Orders dated 15 January 1951 (under Section 179) and 22 July 1952 (under Section 237) granted the Liquidator liberty to initiate proceedings; all relevant affidavits were before the Company Judge, satisfying any putative requirement.
- Precedent support. Decisions in Jaswantrai Akhaney, Bishan Sahai, and Mrityunjoy Chakravarti directly upheld the Liquidator’s competence to prosecute without prior sanction. The Court found these persuasive and consistent with the statutory text.
Holding and Implications
APPEAL DISMISSED.
The Supreme Court affirmed that a complaint filed by an Official Liquidator against past directors during compulsory winding-up is not void for lack of a prior judicial direction under Section 237(1). The decision maintains ongoing criminal proceedings and clarifies that Section 237 does not impose a mandatory sanction or hearing prerequisite for such prosecutions. The ruling reinforces the Liquidator’s statutory autonomy under Section 179 while leaving intact the Company Court’s overarching supervisory powers; it sets no new precedent but provides authoritative interpretation of Sections 179 and 237 for future winding-up proceedings.
Kapur, J.— This appeal by special leave raises a question of interpretation of Section 237 of the Indian Companies Act. Appellant 1 is one of the past directors of the Bank of Commerce Ltd., now in liquidation and Appellant 2 was its Managing Director. The Bank was ordered to be wound up by the High Court of Calcutta on August 7, 1950 and one G.K Dutt, Bar-at-law was appointed its Official Liquidator but on September 7, 1950 the Official Receiver was appointed in place of Dutt. On July 23, 1952 Respondent 1 filed in Court of the Presidency Magistrate a complaint against the appellant under Sections 120-B, 406, 467, 477-A of the Indian Penal Code and 182-A of the Indian Companies Act and stated that he was doing so under the authority of the Official Liquidator and the Official Liquidator had obtained the directions of the High Court to file the complaint. On May 5, 1953 the appellant applied to the Presidency Magistrate for dismissal of the complaint as being without the sanction of the Company Judge and therefore the Official Liquidator in his official capacity was incompetent to prefer the complaint, being the creation of the statute he could only act within the four corners of the statute. He possessed only those powers which the statute conferred on him. This application was dismissed by the Presidency Magistrate on June 13, 1953.
2. The appellant then applied to the High Court for quashing the criminal proceedings on the ground that the prosecution was ab initio void because of the absence of prior direction judicially given by the High Court under Section 237(1) of the Indian Companies Act. The High Court found against the appellants and discharged the rule. The learned Chief Justice held that the provisions of Section 237(1) are no bar to a prosecution by the liquidator; that under Section 237(1) there is “nothing in the nature of a judicial proceeding”; that it could not be said that the order was not a valid direction under Section 237(1). He said:
“There can be no question in the present case that the relevant facts were all placed before the Company Judge, because they are all set out in the report of Adhikary and the affidavits annexed thereto to which the order expressly refers and with reference to which the liberty to bring legal proceedings was expressly given. In view of those circumstances, it is impossible to say that the Company Court had not before it all the facts on which the prosecution is based or that it did not apply its mind to the considerations relevant to Section 237(1).”
He also held that clause (a) of Section 179 empowers the liquidator to institute or defend legal proceedings in the name of the company and that it was expressly concerned with the powers of the liquidator whereas Section 237 dealt with the powers of the Court to give directions. P.B Mukherji J., gave a concurring judgment. After referring to the history of Section 237, he held that under that section the Company Judge can act ex parte and it was not necessary for him to hear a director or an officer of the company complained against and that direction given under that section was not a condition precedent to a prosecution by the Official Liquidator nor is it the intention of that section to impinge on the powers of a criminal court under the Code of Criminal Procedure. Leave to appeal having been refused by the Calcutta High Court, the appellants have come to this Court in pursuance of special leave.
3. On the application of the Official Liquidator Bachawat, J., on January 15, 1951 made an order which must be taken to be one under Section 179. In this order it was said:
“And it is further ordered that the said applicant be at liberty to institute or defend any suit or prosecution, or other legal proceedings, civil or criminal in the name and on behalf of the said Bank and to continue all pending suits and execution proceedings by or against the said Bank and for that purpose to engage advocates. Vakils and other lawyers and to pay out of the assets of the said Bank in his hands all costs of and incidental to such suits, prosecutions and/or legal proceedings.”
On July 22, 1952 the Official Liquidator obtained the order from Bannerji, J., which the High Court has held, and in our opinion rightly, to be an order under Section 237(1) of the Indian Companies Act. This order said:
“It is ordered that the said applicant be at liberty to take such civil or criminal proceedings as he may think necessary over the report of the said Jasoda Dulal Adhikary read with the affidivits of H. Sen Gupta and Nepal Chandra Adhikary read with the affidavits of H. Sen Gupta and Nepal Chandra Mitra as set out in the said Exhibit ‘A'.”
The passage already quoted from the judgment of the learned Chief Justice shows that all the relevant facts were before the Company Judge, as they were all set out in the affidavits placed before him. The complaint was then filed on July 23, 1952. During the pendency of the complaint the appellants took an appeal against the order of the Company Judge dated July 22,1952, but it was dismissed on the objection taken by the liquidator that it was an administrative order and not a judicial order.
4. On August 5, 1953 the Official Liquidator took out misfeasance proceedings under Section 235 of the Companies Act and the appellants then applied to the High Court for quashing the criminal proceedings already started on the ground of commencement of proceedings under Section 235. This application was also heard with the rule which was issued on June 29, 1953 and it was dismissed by the same judgment by which the rule was discharged i.e of June 21, 1954.
5. The general scheme of the Companies Act is that the court should have complete control of all proceedings in winding up and it was therefore urged that the Official Liquidator was not authorised to do anything either without the sanction of the court or without its direction. Section 179 deals with the powers of Official Liquidator. It provides:
“The Official Liquidator shall have power, with the sanction of the court, to do the following things:
(a) to institute or defend any suit or prosecution or other legal proceeding civil or criminal in the name and on behalf of the company;....”
Under Section 180 the court may provide that the Official Liquidator may exercise any of the powers given under Section 179 without the sanction or intervention of the court. Section 183 deals with the exercise and control of liquidator's powers. Sub-section (3) authorises him to apply to the Court for directions in relation to any particular matter arising in the winding up. Sub-section (4) is a provision under which the Official Liquidator is entitled to use his own discretion in the administration of the assets of the company and in the distribution amongst the creditors. Sub-section (5) provides:
“If any person is aggrieved by any act or decision of the Official Liquidator, that person may apply to the court, and the court may confirm, reverse or modify the act or decision complained of, and make such order as it thinks just in the circumstances.”
These provisions show that Section 179 deals with the powers of the liquidator.
6. Under Section 235 the court has the power to assess damages against delinquent directors and the court may on the application of the liquidator or a creditor or a contributory examine into the conduct of a director and compel him to pay or restore money or property or to contribute such sum to the assets of the company by way of compensation in respect of any misfeasance on his part and this power may be exercised irrespective of the criminal liability of the director. Section 237 deals with prosecution of delinquent directors and the relevant portion of this section is:
“(1) If it appears to the court in the course of a winding up by, or subject to the supervision of, the court, that any past or present director, manager or other officer, or any member, of the company has been guilty of any offence in relation to the company for which he is criminally liable, the court may, either on the application of any person interested in the winding up or of its own motion, direct the liquidator either himself to prosecute the offender or to refer the matter to the registrar.
(2) If it appears to the liquidator in the course of a voluntary winding up that any past or present director, manager or other officer, or any member of the company has been guilty of any offence in relation to the company for which he is criminally liable, he shall forthwith report the matter to the registrar and shall furnish to him such information and give to him such access to and facilities for inspecting and taking copies of any documents, being information or documents in the possession or under the control of the liquidator relating to the matter in question, as he may require.
(3) Where any report is made under sub-section (2) to the registrar, he may, if he thinks fit, refer the matter to the Central Government for further enquiry, and the Central Government shall thereupon investigate the matter and may, if they think it expedient, apply to the court for an order conferring on any person designated by the Central Government for the purpose with respect to the company concerned all such powers of investigating the affairs of the company as are provided by this Act in the case of a winding up by the court.
(4) If on any report to the registrar under sub-section (2) it appears to him that the case is not one in which proceedings ought to be taken by him, he shall inform the liquidator accordingly, and thereupon, subject to the previous sanction of the court, the liquidator may himself take proceedings against the offender.
(5) If it appears to the court in the course of voluntary winding up that any past or present director, manager or other officer, or any member, of the company has been guilty as aforesaid, and that no report with respect to the matter has been made by the liquidator to the registrar, the court may, on the application of any person interested in the winding up or of its own motion, direct the liquidator to make such a report, and on a report being made accordingly, the provisions of this section shall have effect as though the report has been made in pursuance of the provisions of sub-section (2).
(6) If, where any matter is reported or referred to the registrar under this section, he considers that the case is one in which a prosecution ought to be instituted, he shall place the papers before the Advocate-General or the Public Prosecutor and if advised to do so institute proceedings:
Provided that no prosecution shall be undertaken without first giving the accused person an opportunity of making a statement in writing to the registrar and of being heard thereon.
* * *”
It was this section which the appellants pressed in support of the argument that without the order of the court the Official Liquidator cannot lodge a criminal complaint against a past director and if he does so the proceedings will be ab initio void. All that sub-section (1) requires is that if the court finds in the course of winding up that any past or present director etc., has been guilty of any offence in relation to the company the court may either on the application of the person interested or of its own motion direct the liquidator to prosecute the offender or to refer the matter to the registrar. In the latter case if the registrar finds that the prosecution ought to be instituted he can do so if advised by the Advocate-General or the Public Prosecutor. But emphasis was placed by counsel for the appellants on the proviso that no prosecution could be undertaken without first giving the accused person an opportunity of making a statement to the registrar or of being heard and it was urged that if the registrar cannot institute prosecution without first giving an opportunity to the person accused to file an explanation, no directions, could be given by the Judge unless the persons accused are first allowed an opportunity of giving an explanation. But this contention must be repelled. Under Section 237(1) the court may direct the liquidator to himself prosecute the offender or to refer the matter to the registrar. Giving an opportunity to the offender before such direction is given by the court is not a prerequisite of the Judge making an order under sub-section (1). Under sub-section (6) the registrar is required to give the offender an opportunity to show cause before a prosecution is undertaken. That is a far step from saying that Section 237(1) of the Companies Act requires a Judge to give the offender an opportunity before he gives a direction for prosecution by the liquidator or for reference to the registrar.
7. It was further urged that under sub-section (4) in the case of voluntary liquidation, the liquidator has to proceed after obtaining the sanction of the court and therefore it was urged that the liquidator cannot institute criminal proceedings without such sanction in the case of winding up by the court. Whatever may be the case of a liquidator under voluntary winding up sub-section (1) of Section 237 makes no such provision in the case of compulsory liquidation. Our attention was drawn to some passages from the Indian Companies Act by Sircar & Sen 1937 Edn.. At p. 624 it is stated that the object of the section is to provide against abuses and indiscriminate commencement of prosecutions and also for the first time a provision has been made under this section for prosecutions being conducted as crown prosecutions. In a passage at p. 628 it is stated:
“But before the Court can exercise its jurisdiction it must come to the conclusion that in the course of winding up the person intended to be charged under this section has been guilty of an offence in relation to the company for which he is criminally liable. But such a finding is not to prejudice the accused in any way in his trial. Per Chitty, J. in re Charles Denham & Co., Ltd. LT 570 at 571.”
The procedure under Section 237(1) as stated in this book at the same page is as follows:
“The application should be made on a petition verified by an affidavit in which materials must be set out sufficient to make out a prima facie case.
It is not quite settled as to whether the liquidator should make the application upon notice to any one. Generally the application should be ex parte, but the court may direct notice to be given to any person who is in its opinion entitled to be heard.”
These passages do not support the contention that before a prosecution can be validly instituted against a past director the sanction of the court is necessary. Mr Chaudhuri then relied on an observation of Buckley, J., In Re London and Globe Finance Corporation (1903) 1 Ch 728 also quoted in Sarcar & Sen's book at p. 623. There the principles guiding the court in ordering prosecutions have been laid down as follows:
“I have next to consider upon what principles I ought to exercise the power given me by Section 167 of the Companies Act, 1862, to direct the Official Receiver to institute and conduct a prosecution at the expense of the assets. It is obvious that no one legitimately can or ought to institute a criminal prosecution with a view to his personal profit. Neither should a prosecution be instituted from motives of vengeance against the offender. The motive of every prosecution ought to be to inflict punishment upon the criminal for the proper enforcement of the law and for the advantage of the State and with a view to deter others from doing the like.”
This passage does not support the giving of an opportunity to the offender before the Judge can give direction nor do they affect the powers of the liquidator to start a prosecution or the criminal court to entertain a complaint when filed by the liquidator.
8. The following passage from Buckley's Company Law under the commentary under Section 334 of the English Companies Act 1948 which corresponds to Section 237 of the Indian Companies Act was then referred to:
“Procedings will accordingly be taken by the Director of Public Prosecutions (or Lord Advocate) or not at all.”
But this is because of the peculiar and express language of Section 334 under which the Judge can only direct the liquidator to refer the matter to the Director of Public Prosecutions or to Lord Advocate as the case may be. In the English Act, special provision has been made for England saving the institution of criminal proceedings by private prosecutors. Merely because no such provision has been made in regard to Scotland does not affect the argument.
9. Mr Choudhuri then relied on certain English cases dealing with the mode of giving directions. In re Northern Counties Bank Limited (1883) 31 WR 546 the Judge had ordered the liquidator to ascertain by circular the wishes of the creditors and after they had appeared to oppose the starting of the prosecution, it was held (1) that it did not sufficiently appear that the offence had been committed, and (2) that as 2/3 of the creditors opposed the application the prosecution should not be ordered as expenses will have to be paid from out of the money belonging to the creditors. The main question for decision in that case was whether the prosecution should be at the cost and expense of the assets of the company but competency of the liquidator to file the complaint was not in dispute. Reference was then made to Palmer's Company Precedents 1952 Edn. Vol. II again stating as to when leave to prosecute should be given but the law stated there does not support the case for the appellants. At p. 605 it is stated:
“The summons will be ex parte, and should be supported by affidavit showing a strong case for prosecution, and also the extent of the assets and liabilities. The court is not willing when the assets are small, to sanction proceedings which may swallow up or largely reduce those assets.”
The form at p. 607 does not show that under the English Companies Act when liberty is given to prosecute the person accused is heard. All that is required is that the court will make its order upon affidavits etc. filed before it and it can also order that the costs and charges incurred by the liquidator shall be paid out of the assets of the company.
10. It was next contended that although the language of Section 237 was not in the negative form still the effect of the words was that no prosecution could be instituted without the sanction of the Court being obtained by the liquidator. In support of the submission counsel relied on Queen v. Cubitt (1889) 22 QBD 622 which was a case under the Sea Fisheries Act which created certain offences and by Section 11 provided:
“The provisions of this Act .... shall be enforced by sea-fishery officers”,
who are defined by that section, and it was held that the effect of the words was that no one except the sea-fishery officer could prosecute an offence under the Act. But there are no such words of limitation in Section 237. In Taylor v. Taylor (1875) 1 Ch 426 the words of the statute were “entitled to the possession or the receipt of the rents and profits” and it was held that the order under the statute could only be made upon a petition which was within the words above quoted and if there was no such person no order could be made but that again was decided on the peculiar language of the statute. Counsel also relied on Nazir Ahmad v. Crown (1936) LR 63 IA 372 where it was held that if the statute authorises the doing of an act in one way then it had to be done in that way or not at all.
11. The argument of Mr Choudhuri really comes to this that the complaint filed on behalf of the Official Liquidator was incompetent in the absence of a direction under Section 237 or without complying with the procedure laid down in that section. Section 237(1) does not lay down any procedure for the giving of directions and the provisions in regard to the action taken by the registrar do not have any relevancy to what the court should do before it gives directions. English cases that have been cited do not go to the extent of saying that no prosecution can be instituted without the sanction of the court. They deal with another subject and that is the circumstances in which the Judge would give directions for prosecution and would sanction the assets of the company to be expended in prosecution. Besides nowhere has it been stated that the court cannot give directions without first hearing the persons accused or that the directions of the Judge are a condition precedent to the lawful institution of criminal proceedings by the liquidator.
12. On the other hand it has been held that under Section 179 of the Indian Companies Act that no sanction is required for commencing a prosecution. In Jaswantrai Manilal Akhaney v. State of Bombay (1956) SCR 483 at the instance of the Official Liquidator a report was lodged with the police against the Managing Director of a Bank and the police submitted a charge-sheet to the Magistrate. It was observed by Sinha, J., at p. 502:
“In terms the section lays down the powers of the Official Liquidator. Such a liquidator has to function under the directions of the court which is in charge of the liquidation proceedings. One of his powers is to institute prosecutions in the name and on behalf of the company under liquidation with the sanction of the court. This section does not purport to impose any limitations on the powers of a criminal court to entertain a criminal prosecution launched in the ordinary course under the provisions of the Code of Criminal Procedure.”
It was also pointed out in this judgment that Section 179 contains no words corresponding to the language of Drug Control Order, 1943, which was held to be a condition precedent for instituting prosecution in the case of Basdeo Aggarwalla v. King Emperor (1945) FCR 93 nor are there any prohibitory words like those that are contained in Sections 196 and 197 of the Criminal Procedure Code. In the former case no prosecution could be instituted without the previous sanction of the Provincial Government and the latter provides that “no court shall take cognizance....”. There are two cases decided by two Indian High Courts which support the submission of the respondents' counsel.
13. In Emperor v. Bishan Sahai ILR (1937) All 779 it was held that the Companies Act nowhere provides that without the directions of a Judge no criminal prosecution can be instituted. In Mrityanjoy Chakravarti v. Provot Kumar Pal AIR (1953) Cal 153 it was held that neither Section 179 nor Section 237 indicates that if the liquidator takes action without a direction of the Court this action would be illegal or invalid or it would invalidate a prosecution.
14. It would thus appear that both on the language of Section 237(i) as well as on precedent the complaint made by the liquidator against the appellants suffers from no such infirmity as to make the proceedings null and void. The section contains no such words which indicate that such a prosecution cannot be instituted by a liquidator without the sanction of the Judge or that the court cannot take cognizance of a complaint without such sanction or direction. Section 179 as the learned Chief Justice of Calcutta High Court has rightly pointed out, deals with the powers of liquidators to institute or defend proceedings with the sanction of the court and Section 237(i) deals with the powers of the Court to give directions for prosecution of delinquent directors etc.
15. It was further urged on behalf of the respondents that in the case before us there was a proper direction under Section 237(1). The judgment of the High Court shows that before the learned Judge gave a direction on July 22, 1952, there were before him proper materials and therefore his sanction was perfectly valid, legal and proper. Before this order made by Bannerji, J., there was an order of Buchawat, J., dated January 15, 1951, under Section 179 and therefore when the liquidator authorised his Assistant, Respondent 1 to institute the proceedings he was entitled to do so. As we have said above even in the absence of such directions the legality of the criminal proceedings instituted would not be affected.
16. Nothing that we have said in this judgment must be taken to be an expression of opinion which in any way affects the control by the Judge of proceedings in winding up or over the liquidators.
17. We would therefore dismiss this appeal.
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