Nawdeep Singh vs Official Liquidator & Anr on 28 February, 2014

[Cites 1, Cited by 2]

Calcutta High Court

Nawdeep Singh vs Official Liquidator & Anr on 28 February, 2014

Mr. Nirmaljit Singh Hoon appears in person In this proceeding, there is a subsisting dispute as to whether the order of winding up passed pertaining to Angelo Brothers Ltd. is at all subsisting or not. Such dispute arises as Mr. Hoon submits that the petition for winding up was permanently stayed by an Hon'ble Single Judge of this Court on 16th September, 1983.

In an affidavit filed on behalf of the Official Liquidator, affirmed on 18th July, 2012, it has been stated that the order of 16th September, 1983 was recalled.

In the judgement reported in 1998 CWN 340 [Angelo Brothers Ltd. [In Liquidation] vs. The Official Liquidator, High Court, Cal. & Ors.], an Hon'ble Division Bench of this Court presided over by His Lordship The Hon'ble Chief Justice, delivered on 13th July, 1998 examined various aspects of the controversy and upon referring to the orders passed in the winding up proceeding on 16th 2 September, 1983; 26th March, 1984; 4th May, 1984 and several other orders, observed that it appeared to the Court that in spite of different orders passed in the matter, assets of the company had never been actually brought under the control of Official Liquidator except some part of the same. Their Lordships were also pleased to observe in the said order that it was not known as to whether any creditor except R. K. Trading Company was paid or if any scheme was prepared and any further step was taken in course of the winding up for discharging the debts and for reviving the company or dividing the residuary between the members/share-holders of the company. Their Lordships were further pleased to observe in the said order and direct :

"7. Be that as it may, since serious allegations have come up and no materials are made available to the Court from which it can infer whether for any cogent reason the order to permanently close winding up proceeding was recalled or there was any sincere effort to take possession of the assets of the company, if there was any trespasser upon any of the properties of the company, steps were taken to evict him and other matters we are left with no alternative but to direct that the matter should be taken up for administrative enquiry by the Court and it be examined whether there has actually been any order to permanently close the winding up proceeding. If there was any such order whether the said order was ever recalled. If the order to permanently close winding up proceeding was not recalled how subsequent orders in the proceedings for winding were passed. If winding up orders were passed in accordance with law whether 3 the Official Liquidator ever took any real and sincere steps to take possession of the assets of the company and after such possession informed the court and if any property remained in possession of any other person under the orders of the Court took steps to recover the same and what is the extent of the property of M/s. Angelo Brothers Ltd. which is in possession of the Official Liquidator. The investment, if any, of the said property and income therefrom as well as if there are some properties which are not in possession of the Official Liquidator whether any legal action to recover the same is required to be taken.

8. While holding enquiry in respect of the above it would be most pertinent to examine whether there has been any manipulation in the proceedings of the Court inasmuch as there are orders of the Court as aforementioned in the proceeding and/or application/petition therein and the letter addressed by the Assistant Registrar (Company) was pursuant to any other of the Court or not, it would be improper, in our view, to direct for sale of any property of M/s. Angelo Brothers Ltd. pending the above enquirty and unwise if property of the company is allowed to be appropriated without there being concrete and cogent materials on the record to show that all aspects of the matter have been examined before such orders have been passed.

9. For the reasons aforementioned, we direct the Chief Judge, City Civil Court to hold enquiry into the matter and make report on the subjects aforementioned within two months. Let the matter appear for further 4 orders after the report aforementioned is filed in Court. Until further orders there shall be a stay of any appropriation including sale of the properties of M/s. Angelo Brothers Ltd."

It appears that in pursuance of such direction of the Hon'ble Division Bench, an investigation was conducted by Sri A.K. Dasgupta, who at that point of time was the Chief Judge, City Civil and Sessions Court. The original report, however, is missing from the file of this Court. Copy of the report, however, has been brought on record in an affidavit filed on behalf of the Official Liquidator, affirmed by one Debendra Kumar Singh on 17th December, 2009. In this report, it has been observed:

"After careful scrutiny of the entire materials and after recording the statement of Mr. N S Hoon and the Assistant Official Liquidator I am led to hold that the part played by the Official Liquidator, High court, Calcutta after taking charge of the properties and assets of Angelo Brothers Ltd. is not at all commendable.

My enquiry reveals that Angelo Brothers Ltd. is and was always a rich company and was a victim of conspiracy for having been would up on extremely flimsy grounds. According to Mr. Hoon the value of the present assets of Angelo Brothers would be well over Rupees 200 Crores.

The records tend to show that there has been mult-crores unwarranted loots of Angelo Brothers Ltd. assets. I am of the view that the fact and circumstances of the case swing in favour of holding a thorough and effective enquiry and investigation by CBI in order to bring out the real 5 truth and if the enquiry is held by CBI many things will come up on the surface. CBI enquiry will also held to stop destruction of Angelo Brothers having more than Rs.200 crores assets."

So far as the main winding up petition is concerned, the original is also missing from the file. This has been recorded in the order of an Hon'ble Single Judge of this Court passed on 7th May, 2010 in an application arising out of the same proceeding wherein His Lordship has been pleased to observe, inter alia, :-

"Considering the gravity of the matter brought to my notice by Mr. Hoon, I made it a point that the matter should be thoroughly investigated. Necessary orders from time to time were issued.

Three things, in particular, I wanted to know (a) whether the order dated 16th September, 1983 permanently staying the winding up petition had been recalled before the company was directed to be wound up on 26th March, 1984. On behalf of the Official Liquidator it was suggested at a later stage that the order dated 16th September, 1983 permanently staying the winding up proceedings was recalled by the order dated 30th May, 1984. The explanation given by the Official Liquidator was not acceptable to me. I was of the view which has also been indicated in my order dated 1st December, 2009, that any variation or recalling of the order dated 16th September, 1983 should have been made before the winding up order was finally passed on 26th March, 1984. Therefore, I insisted upon a definite answer to the question.

(b) I wanted to see the original winding up petition which, following the practice in the Original Side, was supposed to contain endorsements with respect to the orders passed from time to time.

(c) I wanted to examine the affidavit of service, which should contain a copy of the newspaper in which the order admitting the winding up petition should have been published.

After prolonged enquiry and various orders passed from time to time, I have been able to ascertain that on 29th September, 1983 the order permanently staying the application was recalled by the Hon'ble Justice D.K. Sen [as His Lordship then was]. This has appeared from the Minute Book which was produced before me. I have also allowed inspection of this semi-ancient document by Mr. Hoon whose reaction is that this is a forged entry made in the Minute Book subsequent to my order dated 1st December, 2009.

The original winding up petition, in spite of repeated directions was not produced before me and the reason assigned is that the same is not traceable. Same is the result with respect to the affidavit of service which has also not been produced before me, for the same reason. This is one part of the matter.

The other part of the matter is that this matter was heard from time to time when I had the occasion to hear Mr. Hoon. He, unfortunately, is in the habit of abusing both the sitting and retired Judges, questioning their honesty and integrity, who passed orders which were not favourable to 7 him. His justification for this outrageous act is that he is merely telling the truth of which there is no evidence before me.

In the circumstances it is not possible for me to apply my judicial mind to the matter without fear or favour. Therefore, I would like to release the matter from my list.

The matter is, accordingly, released.

The Registrar, Original Side, is directed to keep the Minute Book containing the order dated 29th September, 1983 in safe custody until further order."

In my order passed on 17th May, 2013, I had observed that there was no reference to any order of 29th September, 1983 in any of the earlier proceedings an in my view, the question as to whether the winding up proceeding is still subsisting or not requires to be further examined. In my order of 17th May, 2013, I had indicated that the immediate concern of the Court was in relation to existing assets of the company in liquidation. Mr. Hoon had submitted that such assets were generating income in various forms for the benefit of unauthorised persons and none of the persons who were benefiting from transactions with the assets of the company had any right over such assets, which was meant to be under the control of the Official Liquidator, in the event the winding up proceeding was still in operation. Considering the circumstances, I had appointed the D.I.G., C.I.D., Government of West Bengal as a Special Officer directing him to file a preliminary report before this Court on 10th June, 2013 disclosing therein the identity of the occupants of immovable assets of the company and 8 manner in which the funds generated by the assets of the company were being employed, and who were utilising the said fund. The Official Liquidator as also Mr. Hoon were directed to assist the Special Officer in that regard. I had also directed the Registrar, Original Side of this Court to produce the cause list of 29th September, 1983.

No such cause list, however, was produced. On the other hand, one, Biren Pal, Section Officer of Old Record Department, in a report addressed to the Assistant Registrar of this Court, indicated that the cause list of 29th September, 1983 could not be found out in the department. For this reason, the said officer, however, tendered apology.

The Special Officer, appointed by this Court, had initially submitted a report on 11th June, 2013 followed by another interim report on 10th July, 2013. In these reports, the identity of the persons in occupation of the factory of the company at Chitpur and certain other places have been disclosed. In his final report of 30th January, 2014, it has been observed :-

"1. This instant report is being filed pursuant to the order passed by His Lordship Hon'ble Justice Aniruddha Bose on 2nd September, 2013 inter alia directing that the funds so far collected along with accounts thereof shall be furnished with the Ld. Registrar, Original side and the same shall be transmitted to him by Shri A.K. Mitra, an old staff of the subject company. It has been further directed that the entire collection of future funds shall be remitted to the said Ld. Registrar, Original Side who shall hold the same until further order of the Hon'ble Court. 9

2. In compliance with the same, I have interacted with the said Ld. Registrar, Original Side for creating procedural formalities and certain steps have been undertaken by opening a savings bank Account with a nationalised bank for depositing the money so far collected from the occupants of Cossipore Unit. The said Shri A.K. Mitra has been deputed to collect all such moneys and also was authorised to interact with various and or directions of the Special Officer and collecting the documents in relation to such occupancy.

3. On in-depth assessment and investigation of all such documents so far received from the occupants, it has been learnt that most of the occupancy in Cossipore Unit has been created clandestinely and at the behest of Shri Nawdeep Singh and his son Nitin Singh which is evident from the fact that a huge amount of money was taken away as advance prior to creation of such documents. My enquiries reveal that Nawdeep Singh has been collecting 50% in cash to cheat his trusting employers which will be evident from his affidavit in court that Rs.30 Lacs was collected by Mitra in two months. This indicate that Mr. Hoon's Chowkidar has been cheating 1.80 crores every for the last 8 years which totals nearly 15 crores plus other monies obtained from sale of burnt down factory items before the turn of century. It is also very important to mention that Chitpore Police Station Officer S.I. Paul was hand in glove with Nawdeep Singh & Nitin singh otherwise it could not have been possible to steal that huge amount of property. However, the quantum of misappropriation of 10 funds by the said Nawdeep Singh and Nitin Singh will be calculated on production of the documents including bank account of the occupants for which a through investigation is going on.

4. On the score, it may be mentioned here that despite stiff resistance from Nawdeep Singh and his goons an amount of Rs.2,28,720 so far collected from the occupants of the subject premises during the month of December 2013 and has been remitted to the Ld. Registrar, Original Side along with a statement of accounts and also Rs. 2,00,000/- towards past collections remitted to the said Registrar as per your kind order.

5. It is not out of place to submit here that I being DIG, CID (SPL) of Criminal Investigation Department, Government of West Bengal am going to be superannuated on 31st January, 2013 and as such I shall not be available in my office to discharge my duties and for which substitute arrangements may kindly be made. I must also admit that being a Police Officer it is very embarrassing for me to criticise the role of local Police who had been very generous of the activities of Nawdeep Singh in the past connected with the Angelo Brothers. I would like to put briefly my findings on record before relinquishing the charge. My findings are also based on the investigation report of City Court Chief Judge, which was of tremendous help to me at every stage.

I visited the property of Angelo Brothers located at Dum Dum. This multi Crore property was admittedly rented out fraudulently by Mundhra. In fact when I visited the said property with police officials I found all the 11 buildings demolished to rubbles and lacs of bricks stolen and heaps lying scattered all over. As a result Mr. Hoon took possession of his property and put his locks on the gate. Thereafter an FIR was registered against 6 accused persons including Paban Ruia, Haridas Mundhra and P.K. Singhania who were all absconding from Calcutta and are untraced till date as per version of Dum Dum PS. Now finally coming to the Angelo Brothers factory at Cossipur, I could gather the history and background of a vibrant company being ruined and ultimately the goons like Nawdeep Singh and his other associates exercising absolute control over the incomes generated out of it. In fact originally the factory of Angelo was located in this land, which was burnt down by one P.K. Singhania after stealing multi crore machinery of Angelo with help of dishonest workers who were also bribed in crores by Singhania. As such the entire plant of Angelo which will cost nearly five hundred crores today was stolen and transferred to Purulia, where Singhania has built his Gigantic Shellac plant. In any case it is the complaint of Mr. Hoon that the said Nawdeep singh and his son Nitin Singh stole and misappropriated over 15 Crores over the period of 8 years with the help of Police and local goons. Several FIRs have been filed against accused Nawdeep Singh, Nitin Singh and others and as a result Nitin singh was arrested and bailed jailed along with another Choukidar Manoj Sukla. However, the main culprit Nawdeep Singh has evaded arrest for the past 4 months inspite of his cancellation of Bail by both High Court and Supreme 12 Court. This is unfortunate to say that despite all out efforts on the part of Chitpur police station said Nawdeep Singh is yet to be arrested. I hope Chitpur police station will secure arrest of Nawdeep Singh without further delay. In this connection I would like to mention that I at Jhalda. I also could not visit Londaon where 20 crores property of Angelo Brothers was misappropriated by Ashoke Jain and Bennet Colman of Times of India.

Before concluding I must inform your Lordship that I was perpetually and continuously disturbed and obstructed by the lawyers & advocates of the suspects I was investigating. This includes K.N. Fatepuria of Alexander Court as well as Draupadi Mansion etc. who had taken full advantage to divest Angelo of its valuable assets as elaborately recorded in the investigation reports of Chief Judge which I consider as a master piece."

As the said Special Officer has superannuated, it has become necessary to engage another officer from the Law Enforcement Agency of a senior rank to continue with the investigation so that the funds, if any, illegally generated by utilising the assets of the company in liquidation is traced and recovered from the unauthorised beneficiaries thereof. So far as the earlier Special Officer, who was holding the rank of D.I.G., C.I.D., West Bengal, he shall be discharged on filing of proper accounts. But for the purpose of continuing with further enquiry, I appoint the D.I.G., Enforcement Branch, Government of West Bengal as Special Officer of this Court. The scope of his enquiry would be to ascertain the asset position of the company in liquidation and the manner in which, if any, of such 13 assets have been transferred or whether any new interest has been created in respect of them from 16th September, 1983.

An enquiry is necessary also for the purpose of finding out who have been the beneficiaries of the funds generated by such assets.

The Special Officer shall also be empowered to enquire into any ancillary issues necessary for giving his report on the aforesaid two aspects.

The Commissioner of Police, Kolkata, the Official Liquidator and all other state agencies whose help may be necessary for carrying out the direction of this Court shall cooperate with the Special Officer.

A preliminary report shall be filed preferably within a period of six weeks and in the event the Special Officer requires any clarification or further specific direction he shall be at liberty to approach this Court.

Mr. Hoon shall also render necessary cooperation in this respect. Let signed copy of this order along with three reports of the Special Officer as also the copies of all orders passed by this Court from 17th May, 2013 onwards be sent to the D.I.G. Enforcement Branch by Registrar Original Side forthwith. The same set of papers shall also be given to the Public Prosecutor.

(ANIRUDDHA BOSE, J.) kb & gh A.Rs. [C.R.]

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