2023 (12) TMI 1369 - HC - Companies Law

Winding up of the respondent on the ground that it had failed to pay his admitted dues - Sections 434 and 439 read with Section 433(b), (e), (f) of the Companies Act, 1956 - HELD THAT - Since the appellant s salary slips placed on record are not disputed, it is evident that the TDS was deducted by the respondent and that it was liable to deposit the same with the concerned authorities at the relevant time - Similarly, the appellant also claimed that the respondent has failed to deposit the provident fund as reflected in the salary slips. The deposit of provident fund is also a statutory obligation and the failure to do so would invite proceedings by the concerned authorities. Insofar as the other claims are concerned, this Court finds no infirmity with the impugned order dated 12.11.2018 holding that the same are subject matter of some controversy. It is settled law that proceedings under Section 433(e) of the Companies Act would lie only in respect of debts that are admittedly due. A company is not liable to be wound up under Section 433(e) of the Companies Act in respect of debts that are disputed. However, the company s defence as to the claim of an admitted debt must be bonafide and not a moonshine defence. In the present case, it cannot be accepted that the controversy raised by the respondent is, ex facie, untenable or a moonshine defence. Thus, there are no infirmity with the impugned orders passed by the learned Company Court except to the limited extent that the appellant s claim regarding TDS and statutory dues has not been included in the admitted dues. Insofar as the statutory dues regarding provident fund is concerned, it is not disputed that the respondent is liable to deposit the same. The learned counsel for the respondent states, on instructions, that the amount of outstanding provident fund will be paid to the appellant along with interest within a period of four weeks from date, if the same is not deposited with the concerned authorities. It is clear that there is no dispute as to the payment of the amount of ₹ 2,62,800/-. The learned counsel for the respondent states that this amount would be paid along with the applicable interest. He states that in the event the respondent had not deposited the said amount with the PF authorities, the respondent shall do so within a period of four weeks from date along with applicable interest for the period. The respondent shall deposit the admitted amount of ₹ 2,62,800/- along with full interest as applicable with the concerned PF authorities within a period of four weeks from today and provide the evidence for the same to the appellant - The respondent shall also pay costs of ₹ 50,000/- to the appellant within the said period - appeal disposed off.

Summary

Issues:
- Appellant seeking winding up of respondent company for unpaid dues
- Dispute over payment of salary, signing bonus, TDS, and provident fund
- Company Court's decision on admitted and disputed claims
- Appellant's challenge to Company Court's findings
- Respondent's compliance with statutory obligations

Analysis:
The appellant, an ex-employee of the respondent company, filed an appeal challenging Company Court's orders regarding unpaid dues. The appellant alleged non-payment of salary, signing bonus, and other dues, leading to the company's winding-up petition. The respondent resisted, claiming the appellant did not provide proper notice before resignation. The Company Court found some dues admitted and directed payment, while disputing other claims. The appellant challenged this decision, emphasizing TDS deductions, provident fund non-deposit, and signing bonus non-payment.

The Court acknowledged TDS and provident fund obligations, holding the respondent accountable for non-depositing TDS and provident fund contributions. The Court emphasized that admitted debts are necessary for winding up under the Companies Act, rejecting winding up for disputed claims. However, the Court found merit in the appellant's TDS and provident fund claims, directing respondent to pay admitted dues and costs within four weeks.

Regarding TDS deposit, the Court clarified that if the respondent had deposited the amount within the stipulated period, the appellant should not be liable for interest or charges. The Court also addressed discrepancies in provident fund payments, directing the respondent to pay the admitted amount with interest. The judgment provided a framework for compliance and restoration of the petition if directions were not followed, allowing the appellant to pursue other claims legally.

In conclusion, the Court disposed of the appeal by ordering the respondent to fulfill statutory obligations, pay admitted dues, costs, and interest within a specified period. The judgment balanced the interests of both parties, emphasizing compliance with legal obligations and addressing the disputed and admitted claims effectively.