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2024 (6) TMI 776 - HC - Companies LawPermission for withdrawal of petition with liberty to institute proceedings before the appropriate commercial court for adjudication of their claims - Seeking winding up of the respondent company - Section 433(e) of the Companies Act, 1956 read with Sections 434 and 439 of the Act - Non-payment of outstanding dues with interest. Winding up of company - HELD THAT -This Court is of the opinion that the contentions raised by the parties constitute triable issues, insofar that there is a dispute as to the existence of a payable debt. It is trite law that the Company Court cannot enter into an adjudication of disputed facts, wherein a finding on facts is to be recorded as regards whether the liability stated is actually due and payable, and such a case would be the subject matter of a commercial suit. Withdrawal of petition - it has been prayed by learned Counsel for the Petitioner that they may be permitted to withdraw the present petition with liberty to institute proceedings before the appropriate commercial court for adjudication of their claims in accordance with law - HELD THAT - Reference may be invited to the decision of a Co-ordinate Bench of this Court in M/S. SHANKAR STEEL SUPPLIER VERSUS M/S. RAMPUR ENGINEERING COMPANY LIMITED 2018 (12) TMI 1308 - DELHI HIGH COURT , wherein it was held that the issues in contention ought to have been raised before the Civil Court, and it was held therein that ' It is settled legal position that it is not the function of the company court to enter into an adjudication of disputed facts which should have been the subject matter of the Civil Suit.' The present company petition is dismissed as withdrawn, and pending applications, if any, are disposed of. The petitioner is granted liberty to institute proceedings before the appropriate Commercial Court and the petitioner may seek condonation of delay, in accordance with law, for the period of time which has been spent during the pendency of these winding up proceedings. Petition dismissed.
Issues:
Winding up petition under Section 433(e) of the Companies Act, 1956 based on non-payment of outstanding amount. Dispute regarding the existence of a payable debt and overcharging by the petitioner. Request for withdrawal of the petition with liberty to approach the commercial court. Application for benefit under Section 14 of the Limitation Act, 1963. Analysis: The petitioner filed a winding up petition against the respondent company seeking payment of an outstanding amount along with interest. The petitioner claimed that the respondent failed to make payments for goods supplied, leading to the present proceedings. The respondent, on the other hand, disputed the debt, alleging overcharging by the petitioner and claiming a refund for excess amounts paid. The respondent argued that a winding up petition is not the appropriate means for debt enforcement and that the petitioner should pursue the matter in a commercial court. The court noted that the existence of a payable debt was a triable issue and held that the Company Court cannot adjudicate disputed facts, which are to be resolved in a commercial suit. The petitioner's counsel requested to withdraw the petition and approach the commercial court for adjudication. They also sought the benefit of Section 14 of the Limitation Act, 1963 for exclusion of time spent in the current proceedings. The court allowed the withdrawal of the petition, granting liberty to the petitioner to seek relief in the commercial court. Reference was made to a previous decision emphasizing that disputed facts should be addressed in a civil court rather than a company court. The court dismissed the petition as withdrawn, allowing the petitioner to seek condonation of delay for the time spent during the winding up proceedings. In conclusion, the court dismissed the winding up petition, allowing the petitioner to pursue the matter in the appropriate commercial court. The court clarified that the dismissal did not reflect any opinion on the merits of the case, and the petitioner could seek condonation of delay as per law for the time spent during the proceedings.
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