Kerala High Court Recalls Keltron Subsidiaries’ Winding Up Orders, Allows Revival After Fresh Government Approval
Isabella Mariam
The High Court of Kerala Single Bench of Justice Viju Abraham has recalled earlier winding up orders against two subsidiaries of a state-owned electronics corporation, clearing the way for Keltron Power Devices Ltd and Keltron Rectifiers Ltd to be taken out of liquidation and revived. The court allowed the holding company’s request to reopen the companies and to take over their assets and liabilities, after the State Government granted fresh, in-principle approval for a revised proposal involving the companies’ land and a joint initiative with a central research body. It also recorded the holding company’s undertaking to bear existing and future statutory and other dues and noted there was no objection from the Government or the Official Liquidator.
The proceedings arose from two company applications filed by a government-owned holding corporation seeking recall of winding up orders passed against two of its wholly owned subsidiary companies engaged in the manufacture of power devices and rectifiers. The winding up orders had earlier been passed pursuant to opinions rendered by the Board of Industrial and Financial Reconstruction that the companies were not viable. The applicant placed before the Court a Scheme of Compromise, Arrangement and Revival for both companies and sought closure of the liquidation proceedings, discharge of the Official Liquidator, and transfer of assets, records, and liabilities back to the applicant.
The State Government filed affidavits stating that it had examined proposals involving retrieval of company land from liquidation, partial sale of land to a central government-funded scientific institution, and initiation of joint venture activities on the remaining land. The Official Liquidator submitted statements requesting an express undertaking from the applicant to assume responsibility for all existing and future liabilities and suggested compliance with statutory requirements under the Companies Act, 1956. The applicant filed affidavits accepting full responsibility for all dues and liabilities and stated that meetings of members or creditors were unnecessary as the companies were wholly owned subsidiaries and had no secured creditors.
The Court recorded that “Company Application 212 of 2025 is filed by the Kerala State Electronics Development Corporation seeking to recall the order dated 14.11.2005 … for winding up of Keltron Power Devices Ltd., (in liquidation)” and that a similar application had been filed in respect of the rectifier manufacturing company. It noted that the winding up orders had followed opinions of the BIFR that it was just and proper for the companies to be wound up.
The Court observed that affidavits filed by the State Government disclosed that sanction had been accorded in principle “approving the proposal to retrieve 12.19 acres … from the official liquidator” and that decisions had been taken regarding sale of a portion of land and commencement of joint venture activities with a central scientific institution.
It recorded the submissions of the Official Liquidator seeking a direction that the applicant “shall be solely responsible for all present and future dues, claims, and liabilities of the company” and suggesting a meeting of creditors and members under the Companies Act.
The Court noted that the applicant had filed affidavits undertaking responsibility for all dues and liabilities and stating that approval of members was redundant as the companies were wholly owned subsidiaries, and that there were no secured creditors. It further recorded that “the Government of Kerala, as well as the Liquidator, expressed no objection to the proposal submitted by the applicant.”
On this basis, the Court stated that it was of the view that the company applications could be allowed.
After noting that “the Government of Kerala, as well as the Liquidator, expressed no objection to the proposal submitted by the applicant” and that the applicant had filed an affidavit “undertaking responsibility for any dues and liabilities against the company,” the Court directed: “I am of the view that the above Company Applications could be allowed and I accordingly do so.”
Advocates Representing the Parties
For the Petitioners: Nebil Nizar, N. Krishna Moorthy, Akhil J. Chandran, Advocates.
For the Respondents: K. Moni, Standing Counsel for the Official Liquidator; Government Pleader.
Case Title: Kerala State Electronics Development Corporation Limited v. Keltron Power Devices Limited & Anr. and connected matter
Neutral Citation: 2025: KER:95735
Case Number: Co.Appl. No.212 of 2025 in CP No.40 of 2001 and Co.Appl. No.217 of 2025 in CP No.31 of 2002
Bench: Justice Viju Abraham
