2015 (9) TMI 1710 - HC - Companies Law

Seeking winding of the respondent-company - inability to pay the admitted debt - HELD THAT - It is evident that now the stand is that the respondent-company is to recover a sum of ₹ 53,648/- from the petitioner-company, whereas in reply to the notice, the claim was to the tune of ₹ 11,07,297/-. It is further relevant to add here that in reply to the petition, the story that settlement between the parties had taken place in May, 2008 regarding rebate on the invoice value is merely an after thought just to defeat the petition, as no such plea was taken when reply to the statutory notice was given in September, 2008. The defence raised by the respondent-company is not reasonable as the debt cannot be said to be disputed, which has not been paid despite statutory notice and even pendency of the present petition in this court for a period of about six years. Hence, the petition deserves to be admitted - Adjourned to February 16, 2016.

Summary

Issues:
1. Petition seeking winding up of respondent-company due to inability to pay admitted debt.
2. Dispute over quality of material supplied and payments made.
3. Discrepancy in amount claimed by petitioner and respondent.
4. Defense raised by respondent regarding disputed debt and ongoing business operations.

Analysis:
1. The petitioner filed a petition seeking winding up of the respondent-company for its failure to pay an admitted debt. The petitioner, a manufacturer of acrylic yarn, supplied material worth a significant amount to the respondent on credit basis. Issues arose regarding the quality of material supplied, leading to return of some material and issuance of credit notes. Despite repeated requests and a statutory notice, the respondent failed to pay the balance amount, leading to the petition for winding up.

2. The petitioner claimed a balance amount due from the respondent, while the respondent disputed the liability. The respondent alleged that the material supplied was defective, resulting in losses for the company. The respondent contended that no document existed where they admitted the liability. Discrepancies were noted in the amounts claimed by both parties, with the respondent asserting a lower amount due compared to the petitioner's claim.

3. The court observed that the respondent's defense was not reasonable as the debt remained unpaid despite the statutory notice and the pending petition for several years. The court found the debt to be undisputed and ordered the admission of the petition for winding up. However, considering the respondent's ongoing business operations and employment generation, an opportunity was given to settle the accounts by a specified date before further action.

4. The court directed the publication of the petition admission in newspapers and the official gazette if the settlement was not reached by the given deadline. The case was adjourned with the provision for parties to file applications in case of any developments during the interim period. The judgment emphasized the importance of resolving the financial dispute between the parties while considering the respondent's business operations and responsibilities.