2016 (1) TMI 670 - HC - Companies Law

Winding up petition - failure to pay the admitted liability/debt - Held that - As the respondent company was not in a position to discharge its admitted liability, vide order dated 21.4.2015, the petition was admitted. The official liquidator was appointed as Provisional Liquidator vide order dated 25.5.2015. He was asked to take over the movable and immovable assets of the company. No purpose would be served in keeping the matter pending and therefore, in view liability being admitted the company is ordered to be wound up and the Provisional Liquidator is now appointed as Liquidator of the company. Let the factum of winding up of the respondent company be published in the newspapers namely The Indian Express (English) and Jansatta (Hindi) and in the Official Gazette of Government of Haryana.

Summary

Issues:
Petition for winding up under Sections 433(e), 434, and 439 of the Companies Act, 1956 based on non-payment of admitted liability by the respondent-Company.

Analysis:
1. The petitioner-Company filed a petition seeking winding up of the respondent-Company under Sections 433(e), 434, and 439 of the Companies Act, 1956, alleging non-payment of an admitted liability amounting to Rs. 2,09,45,292.

2. The petitioner-Company, engaged in manufacturing and supplying calcium carbonate, had supplied materials to the respondent-Company, which failed to pay the outstanding amount. Despite reminders and statutory notices, the respondent-Company did not clear the debt, leading to the petition for winding up.

3. The respondent-Company, in its reply, contended that the material supplied was of poor quality and unsuitable for manufacturing, and raised objections regarding the complexity of the case. However, the Court found that the respondent had failed to pay the admitted debt, leading to the admission of the petition.

4. Following hearings, the Court, on April 21, 2015, admitted the petition, appointed a Provisional Liquidator for the respondent-Company, and directed the liquidator to take charge of the company's assets. Subsequently, on May 25, 2015, the Official Liquidator was appointed as the Provisional Liquidator.

5. With the respondent failing to discharge its admitted liability, the Court ordered the winding up of the company on the basis of the admitted debt. The Provisional Liquidator was appointed as the Liquidator, and the fact of winding up was directed to be published in newspapers and the Official Gazette of the Government of Haryana.

6. As no representation was made on behalf of the respondent-Company during the proceedings, and considering the admitted liability, the Court concluded the matter by ordering the winding up of the respondent-Company and appointing the Provisional Liquidator as the Liquidator, with directions for publication of the winding-up in newspapers and the Official Gazette.