1998 (12) TMI 628 - HC - Companies Law

Summary

Issues:
- Winding up petition filed by petitioners against respondent company for recovery of due amount.
- Dispute regarding the nature of the transaction and the outstanding amount.
- Company's defense based on multi-party transactions and alleged suppression of facts.
- Court's analysis of the documents and arguments presented by both parties.
- Decision on the admission of the winding up petition and directions given to the respondent company.

Winding Up Petition:
The petitioners sought winding up of the respondent company due to an amount of Rs. 22,49,041.10 being owed, inclusive of interest. The claim originated from an inter-corporate deposit of Rs. 20 lakhs made by the petitioners to the company, with subsequent renewals and issuance of post-dated cheques. The company failed to repay the deposit, leading to the petitioners filing a winding up petition.

Dispute Over Transaction Nature:
The respondent company contended that the transaction was part of a multi-party arrangement, and the amount due needed reconciliation. They argued that any outstanding amount was secured under valid Leave and Licence Agreements. The company denied liability and accused the petitioners of misleading the court.

Court's Analysis:
Upon reviewing the documents, the court found that the transaction was a straightforward inter-corporate deposit and not part of a larger multi-party arrangement as claimed by the company. The court dismissed the company's defense as not honest or bona fide. The court also noted that the company's subsequent filing of a recovery suit did not improve its position.

Decision and Directions:
The court directed the respondent company to deposit Rs. 20 lakhs with the court within two months. If the amount was deposited, the winding up petition would be dismissed. The deposited amount would be invested in a fixed deposit, with interest credited to the suit for recovery. Failure to deposit the amount would result in the admission of the winding up petition.

In conclusion, the court's detailed analysis of the transaction, the parties' arguments, and the subsequent decision to give the respondent company an opportunity to deposit the due amount showcased a thorough examination of the case before reaching a final decision on the winding up petition.