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Issues:
1. Parallel proceedings on the same cause of action. 2. Claim barred by limitation. 3. Adjustment of bills and dispute on the third bill. Issue 1: Parallel Proceedings on the Same Cause of Action: The petitioning creditor conducted share transactions on behalf of the company under an agreement. Bills totaling Rs. 10,68,934.25 remained outstanding. The company raised disputes regarding the bills. The company argued that since a civil suit on the same cause of action was pending, the winding-up proceeding should not continue. The company cited legal precedents to support its contention. However, the court held that the mere pendency of a civil suit does not bar a winding-up proceeding. The court differentiated between a civil suit seeking a decree and a winding-up petition, which is a statutory right granted to a creditor under the Companies Act, 1956. The court rejected the argument that parallel proceedings should prevent the winding-up petition. Issue 2: Claim Barred by Limitation: The company contended that the claim was barred by limitation as the bills were raised before the filing of the winding-up petition. The court found this argument unconvincing, stating that the timeline of bill issuance and petition filing did not automatically render the claim time-barred. The court highlighted that limitation is a mixed question of fact and law, and the mere chronological sequence of events does not necessarily establish a limitation defense. Issue 3: Adjustment of Bills and Dispute on the Third Bill: The company claimed that the first two bills were settled by an amount held by the petitioning creditor on behalf of the company. Additionally, the company disputed the third bill, alleging that the consignment related to it was never received and that the signature on the consignment note was forged. The court noted that the company failed to provide contemporaneous evidence of the adjustment of the first two bills. Moreover, the court found the company's dispute regarding the third bill unsubstantiated, as the company did not clarify the non-receipt of the consignment despite repeated demands for payment. The court emphasized that to resist winding-up proceedings, a company must raise a bona fide dispute, which was not adequately demonstrated in this case. Consequently, the court admitted the winding-up petition for the outstanding sum, allowing the petitioning creditor to publish advertisements and granting the company a payment schedule. In conclusion, the court dismissed the arguments regarding parallel proceedings and limitation, while also rejecting the company's claims of bill adjustment and dispute on the third bill. The court emphasized the statutory right of a creditor to seek winding up under the Companies Act, 1956, and admitted the winding-up petition for the outstanding amount, providing a payment schedule for the company.
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