2010 (6) TMI 329 - HC - Companies Law

Unpaid creditor on account of services rendered - Held that - There is no merit in the company s defence and the petitioner is entitled to an order of admission. However, the company is afforded the luxury to contest the claim in a suit that may be brought by the petitioner, subject to the company furnishing security in respect of the principal claim of the petitioner in the sum of ₹ 37,33,055. In the event such security is furnished within a period of four weeks from the date before the Registrar, Original Side, the claim of the petitioner will stand relegated to a suit and the security will stand to the credit of the suit that may be brought by the petitioner within a period of ten weeks from date. The company will furnish the security upon intimation to the petitioner and the Registrar, Original Side, will make a fixed deposit of the money in a nationalised bank within the vicinity of this court. In default of the security being furnished within the time permitted, the petition will stand admitted for the principal sum of ₹ 37,33,055 together with interest thereon at 10 per cent. per annum from the date of the statutory notice. In the event the petitioner fails to file the suit within the time permitted notwithstanding the security having been furnished by the company, the company will have liberty to mention the matter upon notice to the petitioner for the security to be directed to be immediately released.

Issues Involved:
1. Claim of unpaid dues by the petitioner.
2. Delay in completion of electrical works.
3. Increase in rates due to extended completion schedule.
4. Dispute over the authenticity of a letter dated May 26, 2008.
5. Admission of the petitioner's claim and provision for security.

Detailed Analysis:

1. Claim of Unpaid Dues by the Petitioner:
The petitioner claims to be an unpaid creditor for services rendered, specifically for electrical works at leisure villas near Rishikesh. The contract was executed on December 21, 2005. Despite completing the work and submitting final bills, the petitioner alleges non-payment of dues amounting to Rs. 41,88,876, including interest.

2. Delay in Completion of Electrical Works:
The petitioner argues that the delay in completing the electrical works was due to the company's failure to complete civil works on time. The company, however, contends that the delay was caused by the petitioner. Both parties refer to the minutes of a meeting held on March 12, 2008, where the petitioner agreed to complete the work by April 15, 2008, and requested compensation for increased prices due to the extended schedule.

3. Increase in Rates Due to Extended Completion Schedule:
The minutes of the March 12, 2008 meeting recorded an agreement to enhance the rates of items supplied and executed after March 12, 2007, by 12%, except for extra items. The petitioner uses this agreement to argue that the delay was not attributed to them, as the company agreed to the increased rates. The company claims it was forced to agree to the higher rates to avoid inconvenience and because alternative agencies were not readily available.

4. Dispute Over the Authenticity of a Letter Dated May 26, 2008:
The company produced a letter dated May 26, 2008, alleging the petitioner's failure to complete the work and refuting the final bill. The petitioner denied receiving this letter and questioned its authenticity, pointing out discrepancies in the courier's proof of delivery and the company's failure to mention this letter in earlier correspondence. The court found the timing and content of the letter suspicious and concluded it was likely fabricated to support the company's defense.

5. Admission of the Petitioner's Claim and Provision for Security:
The court found no merit in the company's defense and ruled in favor of the petitioner. However, the company was given the option to contest the claim in a suit, provided it furnished security for the principal amount of Rs. 37,33,055 within four weeks. If the security is provided, the petition will be stayed, and the petitioner must file a suit within ten weeks. If the security is not furnished, the petition will be admitted, and the petitioner will advertise the claim in specified newspapers.

Conclusion:
The court ruled that the petitioner is entitled to an order of admission for the unpaid dues, subject to the company furnishing security. The observations in the judgment should not prejudice either party in the proposed suit. No order as to costs was made at this stage, and urgent certified copies of the judgment are available upon compliance with requisite formalities.

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