1998 (5) TMI 413 - HC - Companies Law

Issues Involved:
1. Application for recalling and/or review of orders dated 10.4.1997 and 2.12.1997.
2. Application u/s 5 of the Limitation Act for condonation of delay.
3. Application for stay of the aforesaid orders.
4. Maintainability of the winding-up petition u/s 433 and 434 of the Companies Act.
5. Admission of liability by the respondent.
6. Whether the claim is barred by limitation.
7. Impact of dismissal of the application under Order 12 Rule 6 CPC on the winding-up petition.

Summary:

1. Application for recalling and/or review of orders dated 10.4.1997 and 2.12.1997:
The respondent filed applications for recalling and/or review of the orders dated 10.4.1997 and 2.12.1997. The court noted that the respondent's counsel was absent on crucial dates, and despite the publication of citations in newspapers, the respondent did not take timely action. The court found negligence and/or wilful inaction on the part of the respondent and dismissed the applications.

2. Application u/s 5 of the Limitation Act for condonation of delay:
The respondent sought condonation of delay in filing the application for recalling and reviewing the orders. The court observed that the respondent had knowledge of the proceedings through citations published in newspapers and failed to act promptly. The delay was not satisfactorily explained, and the application for condonation of delay was dismissed.

3. Application for stay of the aforesaid orders:
The respondent also filed an application for staying the operation of the orders dated 10.4.1997 and 2.12.1997. Given the dismissal of the applications for recalling and review, the court found no grounds to stay the orders and dismissed this application as well.

4. Maintainability of the winding-up petition u/s 433 and 434 of the Companies Act:
The petitioner filed a winding-up petition u/s 433 read with Section 434 of the Companies Act, claiming the respondent's inability to pay dues amounting to Rs. 6,89,870.76. The Division Bench had earlier remitted the matter back to the Company Judge, noting an admission of liability by the respondent. The court found that the requirements of Sections 433, 434, and 439 were satisfied, and the winding-up petition was maintainable.

5. Admission of liability by the respondent:
The respondent admitted its liability in a reply dated 22.11.1991, signed by one of its directors, and in its balance sheet for the year ending 31.3.1990. The court relied on this admission to conclude that the respondent was indebted to the petitioner and unable to pay its debt.

6. Whether the claim is barred by limitation:
The respondent argued that the claim was barred by limitation. However, the court held that the acknowledgment of debt in the balance sheet and the reply dated 22.11.1991 constituted an acknowledgment in writing within the meaning of Section 18 of the Limitation Act. Therefore, the petition filed on 14.5.1992 was within the limitation period.

7. Impact of dismissal of the application under Order 12 Rule 6 CPC on the winding-up petition:
The respondent contended that the dismissal of the petitioner's application under Order 12 Rule 6 CPC in a civil suit barred the winding-up petition. The court clarified that the remedies of recovery of money through a civil suit and winding-up proceedings are distinct and separate. The dismissal of the application under Order 12 Rule 6 CPC did not debar the petitioner from seeking winding-up of the respondent company.

Conclusion:
The court dismissed the applications for recalling and/or review of the orders dated 10.4.1997 and 2.12.1997, the application for condonation of delay, and the application for stay of the orders. The winding-up petition was found to be maintainable, and the respondent's liability was acknowledged. The claim was within the limitation period, and the dismissal of the application under Order 12 Rule 6 CPC did not affect the winding-up proceedings. The case was listed before the Hon'ble Company Judge for further orders.

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