2009 (7) TMI 763 - HC - Companies Law

Winding up - seeking for appointment of a liquidator for the respondent-company - Held that - As per annexure J reply dated 12-12-2007, sent to the legal notice dated 5-12-2007, issued by the petitioner, the respondent-company has clearly admitted that the total terminal benefits payable to the petitioner were approximately in a sum of ₹ 1,85,000 and that the said amount will be paid to the petitioner without prejudice to their rights. Since this is an admitted sum, the respondent-company cannot avoid its liability only on the ground that the proceedings are pending before the competent authority. The petitioner who has undeniably worked under the respondent-company is entitled for the admitted amount to sustain himself. The respondent-company is directed to pay a sum of ₹ 1,65,692 to the petitioner within four weeks from today.The petitioner shall receive this amount subject to the result of the proceedings pending before the Controlling Officer under the provisions of the Payment of Gratuity Act. In case, the proceedings goes against the petitioner, it would be open to the respondent-company to recover this amount in accordance with law

Issues involved:
Petition under section 433(e) and (f) and section 434 of the Companies Act, 1956 seeking appointment of a liquidator and winding up of the company.

Detailed Analysis:

1. Claim for Terminal Dues:
The petitioner, a former employee, sought terminal dues from the respondent-company after resigning from his position. The petitioner claimed an amount of Rs. 4,71,201 as terminal benefits, which was disputed by the respondent. After several communications and legal notices exchanged between the parties, the respondent admitted liability to pay Rs. 1,85,000 as terminal benefits. However, the respondent withheld the payment, leading the petitioner to file the petition under the Companies Act.

2. Disputed Liability and Pending Proceedings:
The respondent argued that the admission of liability was not unqualified and was made without prejudice to their rights and contentions. Additionally, the respondent had initiated proceedings for alleged misconduct by the petitioner, resulting in the forfeiture of a part of the gratuity amount. The respondent contended that the petitioner had also approached the Controlling Officer under the Payment of Gratuity Act, and a suit was pending regarding the petitioner's actions. The respondent claimed that the petitioner was not entitled to maintain the petition due to these pending proceedings.

3. Judicial Findings and Decision:
The court examined the evidence and found that the respondent had admitted liability to pay Rs. 1,85,000 as terminal benefits to the petitioner. The court noted that this admitted amount could not be avoided by the respondent based on pending proceedings or disputes over other amounts claimed by the petitioner. While acknowledging that the proceedings before the Controlling Officer would impact the payment, the court directed the respondent to pay the admitted amount of Rs. 1,65,692 (after deducting the amount already paid) to the petitioner within four weeks. The petitioner was instructed to receive this amount subject to the outcome of the proceedings before the Controlling Officer.

4. Disposition of the Petition:
The court disposed of the company petition under section 433(e) and (f) of the Companies Act by ordering the respondent to pay the specified amount to the petitioner within a stipulated timeframe. The petitioner was granted the right to receive the amount subject to the result of the ongoing proceedings before the Controlling Officer. In case the proceedings ruled against the petitioner, the respondent was permitted to recover the paid amount in accordance with the law.

In conclusion, the judgment resolved the dispute over terminal benefits by directing the respondent to pay the admitted amount to the petitioner while considering the impact of pending proceedings on the final payment. The decision balanced the rights of both parties and provided a clear directive for the resolution of the financial dispute.

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