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Issues:
Challenge to order passed by Trial Judge, Failure to comply with obligations under Memorandum of Understanding (MOU), Just and equitable ground for winding up, Company's debt and inability to pay, Admissibility of winding up petition, Requirement of bank guarantee for securing claim. Analysis: The appellant challenged the order passed by the Trial Judge on two dates, 29-6-2001 and 23-11-2004. The appellant contended that the winding up petition was admitted based on a Memorandum of Understanding (MOU) where the company failed to fulfill its obligations, leading to a disputed debt. The appellant argued that the company was solvent and should not be wound up. On the other hand, the respondent highlighted the agreement between the parties, stating that the company owed a debt of Rs. 22,26,000 as per the MOU. The respondent emphasized that repeated reminders for payment were ignored by the company, justifying the winding up petition under section 433(e) of the Companies Act, 1956. The Court examined the orders passed by the Trial Judge and found the company had no tangible assets, with an annual profit of only Rs. 1 lakh, which was insufficient to prevent winding up. The Court upheld the Trial Judge's decision on admitting the winding up petition, considering the undisputed debt owed by the company. The Court directed the company to furnish a bank guarantee or security of Rs. 20 lakhs within four weeks to contest the claim, failing which the Official Liquidator would proceed with the winding up process. In conclusion, the appeals and applications were disposed of based on the requirement for the company to secure the claim through a bank guarantee or security. The Court's decision aimed to provide a chance for the company to contest the claim while ensuring the petitioning creditor's interests were protected.
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