2018 (9) TMI 1456 - HC - Companies Law

Seeking winding up petition - existence of Bonafide dispute - Held that - The disputes raised by the respondent are bonafide. It is appropriate that the petitioner approaches the executing court to execute the present decree where detailed examination of the objections raised by the respondent can be gone into including by leading evidence, if necessary. This petition is accordingly dismissed. I, however, grant liberty to the petitioner to approach the executing court as per law to execute the decree. It is made clear that any observation made herein are only for the purpose of adjudication of the present petition and would not in any manner prejudice the parties in case proceedings are commenced before the appropriate civil court.

Issues Involved:
1. Maintainability of winding up petition based on a foreign decree.
2. Adequacy of service of summons on the respondent.
3. Allegations of fraud and deficiency in services provided by the petitioner.
4. Legality of services provided by the petitioner in India in light of an FIR.

Issue-wise Detailed Analysis:

1. Maintainability of Winding Up Petition Based on a Foreign Decree:
The petitioner sought winding up of the respondent company under sections 433(e) & (f), 434(1)(a) & (c), and 439 of the Company Act, 1956, based on a foreign decree obtained from the High Court of Republic of Singapore. The court referenced the judgment in Ex.Sud Ltd. v. Indian Aluminium Cables Ltd., which established that a winding up petition can be based on a foreign decree. However, the court must test the foreign decree for fraud or non-binding nature under Section 13 of the CPC. The court concluded that the petitioner should file execution proceedings under Section 44-A CPC to test the validity of the decree after recording evidence.

2. Adequacy of Service of Summons on the Respondent:
The respondent argued that the foreign decree was obtained without proper service of summons, violating principles of natural justice. The petitioner claimed service was effected at the respondent’s Green Park address and via email. However, service at the Noida address mentioned in the agreement was not attempted. The court noted that service on a servant at a residential address does not comply with Order 5 Rule 15 CPC, which requires service on an adult family member. Additionally, service via email to an address not specified in the agreement ([email protected]) was deemed inadequate, as there was no evidence that Mr. V.K. Gupta was authorized to accept summons on behalf of the respondent.

3. Allegations of Fraud and Deficiency in Services Provided by the Petitioner:
The respondent alleged fraud and serious deficiencies in the services provided by the petitioner, which were not disclosed to the High Court of Republic of Singapore. The court acknowledged that these issues could not be resolved in the present winding up petition and required a detailed examination in execution proceedings.

4. Legality of Services Provided by the Petitioner in India in Light of an FIR:
The respondent contended that the services provided by the petitioner were illegal, citing an FIR registered by the CBI. The petitioner argued that the Telecom Disputes Settlement & Appellate Tribunal (TDSAT) had upheld the legality of the services. However, the court noted that the TDSAT judgment was not in a case initiated by the petitioner, and the legality of the services should be examined in execution proceedings.

Conclusion:
The court found that the disputes raised by the respondent were bona fide and required detailed examination in execution proceedings. The winding up petition was dismissed, granting liberty to the petitioner to approach the executing court to execute the decree. The court clarified that its observations were only for adjudicating the present petition and would not prejudice the parties in future proceedings.

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