2014 (11) TMI 1185 - HC - Companies Law

Winding up petition - substantial delay in execution of the work by the petitioner - Held that - Company s defence raised in the affidavit-in-opposition is substantially at variance from the company s defence alleged in its reply to the statutory notice. Whereas in the reply to the statutory notice the company contended that no extra work was awarded to the petitioner, in its affidavit-in-opposition the company admitted that additional work was, in fact, awarded to the petitioner. Company contends that there was substantial delay in execution of the work by the petitioner for which the company is in the process of filing a suit claiming damages, however, till date no such suit has been filed. Also significant that the company s cheques amounting to ₹ 92,38,399/- were dishonored upon presentation. The company claims that after the cheques were dishonored a sum of ₹ 1,32,81,250/- was paid by it to the petitioner but it is not clear whether such payment was wholly in respect of the contract for supply of fixture and furniture or whether part of it was in respect of the ID Works contract. In case such deposit is made, the Registrar, Original Side will invest the sum in a fixed deposit in a nationalized bank of his choice. In case, the deposit is not made as directed, the winding up petition shall stand admitted and the petitioner will be at liberty to publish advertisement once in The Telegraph , English edition and once in Ananda Bazar Partika within four weeks from the date of admission of this winding up petition. The deposit is made by the company as directed above and the petitioner does not file a suit within four weeks, thereafter, the winding up petition shall stand dismissed and the company will be at liberty to withdraw the amount deposited by it with the Registrar, Original Side of this Court. Let this matter appear under the heading adjourned motion in the monthly list of January, 2015 before the Company Court for further orders.

Summary

Issues:
Claim of due payment under the Companies Act, 1956

Analysis:
The petitioner claimed a due amount of Rs. 1,16,67,100 along with interest from the company under Sections 433, 434, and 439 of the Companies Act, 1956. The petitioner contended that despite serving a statutory notice, the company failed to pay the outstanding debt, indicating its inability to pay its debts and warranting winding up.

Case of the Petitioner:
The petitioner was awarded a contract for supplying and installing furniture for a hotel by the company. The total contract sum was Rs. 4,04,67,847, out of which a balance of Rs. 1,02,11,720 remained unpaid by the company. The company issued two dishonored cheques, leading to a statutory notice. The company admitted the dues but failed to make the payment, justifying the winding up petition.

Case of the Company:
The company argued that the supply of furniture was delayed and defective, with missing parts. There were disputes regarding additional supplies and payments made. The company contended that after the dishonored cheques, it had paid Rs. 1,32,81,250 to the petitioner, raising substantial disputes and questioning the validity of the winding up petition.

Court's View:
The court noted disputed facts and a bona fide dispute raised by the company regarding the petitioner's claim. While the company's defense seemed inconsistent, the court emphasized that it is not a debt collection court. The court directed the company to deposit the due amount with the court, staying the winding up petition. If the deposit is made, the petitioner can file a suit; otherwise, the winding up petition will proceed. This approach aimed to address doubts about the company's bona fides and provide a fair opportunity for resolution without immediate winding up.