2010 (11) TMI 59 - HC - Companies Law

Winding up of the respondent-company seeked on account of its inability to pay the admitted liabilities Held that - There exist sufficient circumstances for recall of the order of winding up dated 12-8-2010 passed in CP No. 56 of 2008 and recall of the order dated 12-8-2010 passed in CP Nos. 57 59 and 60 of 2008 dismissing in default the application seeking setting aside of ex parte admission order. Since the claim of all the creditors stand settled the petitions seeking winding up of the respondent-company are also dismissed as no cause of action survives in the petitions. No justification in transposing the petitioner-creditor in CP No. 73 of 2007 to support the winding up order. The claim of the said petitioner shall be considered in accordance with law in the said petition separately. CP No.99 of 2005 is already fixed for 11-11-2010. The claim of the said creditor shall be considered on the aforesaid date. Thus the order dated 12-8-2010 passed in CP Nos. 56 57 59 and 60 of 2008 is recalled. The petitions are restored to their original number

Summary

Issues:
Application for recall of winding up order and dismissal of applications for setting aside ex parte proceedings.

Analysis:
The judgment pertains to an application for the recall of a winding-up order and the dismissal of applications seeking to set aside ex parte proceedings. The court initially ordered the winding up of the respondent-company due to its failure to pay admitted liabilities. The company did not appear despite service, leading to the admission of the winding-up petition. Subsequently, applications were filed for the recall of the winding-up order and the dismissal of ex parte proceedings. The applicant argued that the company's counsel was unavailable on the hearing date due to genuine reasons. The petitioners claimed their dues were settled, and the company was willing to reimburse the Official Liquidator's expenses post-winding up. The Official Liquidator opposed the recall, citing the need to satisfy all creditors' claims for revival under the Companies Act, 1956. The court referred to a Supreme Court judgment cautioning against hasty revival schemes.

The court considered the arguments presented by both parties. It noted that the company's absence was due to the counsel's mistake, justifying the recall of the winding-up order. The court distinguished the present case from the cited Supreme Court judgment, as it did not involve a revival scheme but a recall due to counsel's non-appearance. Consequently, the court found sufficient grounds to recall the winding-up order and dismiss the petitions seeking winding up, as all creditors' claims were settled. The court rejected the argument to transpose a creditor from another petition to support the winding-up order, emphasizing that the absence of the company's counsel was the primary reason for the order. The court directed the Official Liquidator to communicate expenses and take possession of the company's property.

In conclusion, the court recalled the orders related to winding up and restored the petitions to their original status, dismissing them as infructuous due to settled claims. The Official Liquidator was instructed to receive expenses and take possession of the company's property promptly.