Section 416 — Payments by liquidator into bank

(l) Every liquidator of a
company shall, in such manner as may be prescribed, pay and keep all moneys
received by him or which become available with him or come under his control in
his capacity as such in a special account opened by him in that behalf in a scheduled
bank in the name of the company.

(2) If any such liquidator at any time retains or allows any money to be
not so paid and kept as aforesaid or utilises otherwise for more than three days a
sum exceeding ten thousand rupees or such other amou nt as the Court may on the
application of the liquidator authorise him to retain then he shall pay surcharge on
the amount so retained at the rate of two percent per month or part thereof and shall
be liable to (a) disallowance of all or such part of his remuneration as the Court
may think just; (b) to make good any loss suffered by the company personally and
(c) be removed from the office by the Court of its own motion or on application of
the registrar or a creditor or contributory of the company, and shall also be liab le
personally for any loss occasioned by the default.
(3) No liquidator shall pay into his personal account or any account
other than the liquidation account of the particular company in liquidation any sums
received by him as liquidator.
(4) Every liq uidator who makes default in complying with the
provisions of this section shall, in addition to his other liabilities, be punishable
with imprisonment for a term which may extend to three years and with fine which
may extend to the amount of loss caused t o the company or wrongful gain or five
hundred thousand rupees, whichever is higher.