2023 (10) TMI 1220 - HC - Companies Law

Seeking transfer of proceedings pending before High Courts relating to winding to the NCLT - HELD THAT - The petition was filed some time in 2015 and since then, the pleadings have been completed in the matter. However, no further orders have been passed. In the meantime, the Companies Act, 1956 has been amended and a provision has been enacted for transfer of winding up proceedings pending before the High Courts. Transfer of proceedings pending before High Courts relating to winding to the NCLT has been provided in Section 434 of the Companies Act, 1956. The Supreme Court in ACTION ISPAT AND POWER PVT. LTD. VERSUS SHYAM METALICS AND ENERGY LTD. 2020 (12) TMI 535 - SUPREME COURT , has held that winding up proceedings which have not reached an advanced stage ought to be transferred to the National Company Law Tribunal (NCLT). In the opinion of this Court, since hardly any proceedings have been taken towards winding up of the company, the petition no longer deserves to be continued before this Court. The petition is itself at the very nascent stage and no substantive orders have been passed towards winding up of the company. The petition is liable to be transferred to the NCLT. Parties to appear before the NCLT on 2nd November, 2023.

Summary

Issues involved:
The issue involves seeking winding up of a company due to default in maintenance charges and transfer of winding up proceedings to the National Company Law Tribunal (NCLT) as per the Companies Act, 1956.

Winding up Petition:
The Petitioner filed a petition seeking winding up of the Respondent Company due to default in maintenance charges amounting to over Rs.16 crores. The Respondent had taken possession of office space and parking spaces but failed to pay maintenance charges as per the tender document.

Transfer of Proceedings to NCLT:
The Companies Act, 1956 provides for the transfer of winding up proceedings pending before High Courts to the NCLT. The Supreme Court held in a previous case that winding up proceedings not at an advanced stage should be transferred to the NCLT for resolution under the Code. The current petition, being at a nascent stage with no substantive orders passed, is deemed fit for transfer to the NCLT.

Legal Position on Winding Up Petitions:
The Court examined the legal position in cases where winding up petitions are not at an advanced stage. It was observed that if winding up proceedings have not reached a stage where it would be irreversible, the proceedings should be transferred to the NCLT for resolution in accordance with the provisions of the Code.

Judicial Decision:
Considering the stage of the current petition and the settled law, the Court ordered the transfer of the petition to the NCLT. Parties were directed to appear before the NCLT on a specified date, and the electronic record of the petition was to be transmitted to the NCLT within a week by the Registry.