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Issues Involved:
1. Maintainability of the petition. 2. Bona fide nature of the petition. 3. Ability of the respondent-company to pay its debts. 4. Privity of contract between the petitioner and the respondent-company. 5. Admission of dues and non-payment by the respondent-company. 6. Appointment of a Provisional Liquidator. Issue-wise Detailed Analysis: 1. Maintainability of the petition: The respondent-company contended that the petition was not maintainable before the Gujarat High Court as both the petitioner and the respondent-company's administrative office were in Bombay. However, the court overruled this preliminary contention by noting that the registered office of the respondent-company was at Navsari in Gujarat, and there was no specific denial of this statement by the respondent-company. The court treated this as an indication of the absence of a bona fide defense on the part of the respondent-company. 2. Bona fide nature of the petition: The respondent-company argued that the petition was filed due to business rivalry and was not bona fide. The court, however, found that the petitioners had provided sufficient evidence of the respondent-company's failure to pay its debts, and the petitions were not merely a means to recover disputed debts. The court noted the respondent-company's repeated acknowledgments of its dues and its failure to honor payment agreements. 3. Ability of the respondent-company to pay its debts: The court observed that the respondent-company had admitted to owing substantial amounts to the petitioners and had failed to make any payments after February 1996. The respondent-company's property was under attachment by the Income-tax Department for a claim of Rs. 70 lakhs, indicating its inability to pay its debts. The court concluded that the respondent-company was unable to pay its debts and that it was just and equitable to wind up the company to enable creditors to recover their dues. 4. Privity of contract between the petitioner and the respondent-company: The respondent-company contended that there was no privity of contract between it and the petitioner, as the contract was between the petitioner and H.R. Desai Stran-Wires (P.) Ltd. The court found this contention to be not bona fide, noting that the respondent-company had agreed to co-accept the lease rental bills and had acknowledged its liability in various communications. The court held that the petitioner had a valid claim against the respondent-company. 5. Admission of dues and non-payment by the respondent-company: The court noted that the respondent-company had admitted to owing more than Rs. 8 lakhs to the Bombay Leasing Co. (P.) Ltd. and had failed to make any payments after February 1996. The respondent-company had also failed to comply with court orders to deposit 60% of the dues to show its bona fides. The court found that the respondent-company had no bona fide dispute regarding the debts claimed by the petitioners and had not made any genuine efforts to pay its dues. 6. Appointment of a Provisional Liquidator: The court had previously directed the respondent-company to deposit 60% of the dues before 25-6-1998, which the respondent-company failed to do. The court noted that the respondent-company had repeatedly sought adjournments and had not complied with court orders. Consequently, the court appointed the Official Liquidator attached to the court as the Liquidator of the respondent-company to take over possession of all its movable and immovable assets. Conclusion: The court ordered the winding up of Vitta Mazda Ltd. under sections 433 and 434 of the Companies Act, 1956, with the order relating back to 14-8-1990 when Company Petition No. 126 of 1990 was presented. The Official Liquidator was appointed to take possession of the company's assets, and public notice of the order was to be published in two daily newspapers. The operation of the order was stayed for three weeks on the condition that the respondent-company would not dispose of any of its assets during this period.
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