In a dramatic hearing that kept the packed courtroom unusually silent, the Calcutta High Court on Thursday unravelled what it called a “calculated scheme” that lasted more than four decades. Justice Ravi Krishan Kapur came down heavily on Special Officer Arun Kumar Agarwala for manipulating the affairs of Chrestien Mica Industries Ltd., a once-prominent mica company dragged into liquidation in 1979.
“The bench observed, ‘Fraud unravels everything. Courts cannot allow anyone to retain an advantage obtained through deceit.’”
Background
Chrestien Mica Industries, once run by six Agarwala brothers, owned valuable mining lands across Jharkhand and vast stocks of mica. After the company was ordered into liquidation in 1979, the Court appointed Special Officers in 1991 and temporarily stayed the winding-up. They were meant to safeguard assets, prepare inventories, run mines if needed, and eventually reorganise the company under strict judicial supervision.
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But as years rolled by, no statutory filings were made, no shareholder meetings were convened, and crucially, no inventory of assets was ever produced. What emerged instead was a story of near-total control silently taken over by one man.
Court’s Observations
The Court found that Arun Kumar Agarwala, while acting as Special Officer, systematically took exclusive control of the company - even though he himself was an interested party as a legal heir of a former director.
Justice Kapur noted that Agarwala and his close family members floated or controlled companies such as Nomura Investment & Finance Pvt. Ltd. and Reliance Firebrick & Pottery Co. Ltd. Through these entities, he allegedly became both the largest creditor and the largest shareholder of the company - something the Court called “clandestine and deceitful.”
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Large assets - including mica scrap, machinery, mine-related land, and even property of a subsidiary (Indian Malleable Castings Ltd.) - were allegedly sold without the Court’s permission. “There is simply no accountability nor trace of Rs 72 lakhs handed over by the Official Liquidator,” the Court recorded.
The judge remarked:
“The legal process cannot be utilized for unfair advantage. This is a clear abuse of the Court’s process.”
Shockingly, no records were filed with the Registrar of Companies for over four decades. Even the so-called “Committee of Management” created under Agarwala’s influence never appeared in Court and was found to be a sham.
The Court also dismissed a petition by Nomura seeking transfer of the case to the NCLT, calling it “frivolous and mischievous”, and adding that it was clearly aimed at avoiding scrutiny.
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Decision
In a sweeping order, Justice Kapur declared every action of Arun Kumar Agarwala as Special Officer void, illegal, and without authority.
The Court:
- Discharged both Special Officers (Agarwala and A.C. Kar)
- Held Agarwala responsible for fraud, conflict of interest, and abuse of authority
- Rejected Nomura’s plea to transfer proceedings to NCLT
- Ordered that control of Chrestien Mica Industries Ltd. be handed back to its shareholders, who can now attempt a revival of the company.
The judgment ends firmly:
“The company can no longer remain in liquidation. It must be returned to its rightful shareholders.”
Case Title: Chrestien Mica Industries Ltd. vs. Official Liquidator
Case No.: CP 117/1979 with connected CA matters (1996–2024)
Case Type: Company Petition – Alleged Fraud, Mismanagement & Liquidation Proceedings
Decision Date: 20 November 2025
