2025 (2) TMI 689 - HC - Companies Law

Seeking winding up of company - Sections 433(e)/434(1)(a)/439 of the Companies Act 1956 - HELD THAT - Upon an examination of the record it is evident that the present winding-up petition is a non-starter. The proceedings remain at a preliminary stage with neither a provisional liquidator nor an official liquidator having been appointed to assume control over the assets and affairs of the respondent company. Consequently no substantive orders have been passed in this petition for seven years. Hon ble Apex Court in the case of Action Ispat and Power P. Ltd. v. Shyam Metalics and Energy Ltd. 2020 (12) TMI 535 - SUPREME COURT held that those winding up proceedings pending before the High Courts which have not progressed to an advanced stage ought to be transferred to the NCLT. In the present case the respondent has submitted written submissions explicitly requesting the transfer of the winding-up petition to the NCLT. In view of the respondent s express request for transfer and the legal precedents affirming that a formal application is not indispensable this Court finds no impediment in treating the written submissions as an application for transfer of the present petition to the NCLT. The Court is not bound to insist on a separate application when the intent of the party seeking transfer is evident from the record. Considering the express request by the respondent the fact that no substantive proceedings have been undertaken towards winding up of the company the present petition cannot be allowed to be continued before this Court. Hence the instant petition is transferred to the NCLT Delhi Bench for further proceedings. Conclusion - The petition should be transferred based on the respondent s request and the lack of substantive progress towards liquidation. List before the NCLT on 10.03.2025 - Petition disposed off.

Summary

1. **Issues Presented and Considered:** - Whether a winding-up petition filed under the Companies Act, 1956, at a stage where no irreversible steps have been taken towards liquidation, can and should be transferred to the National Company Law Tribunal (NCLT) at the instance of the respondent.2. **Issue-Wise Detailed Analysis:** - The relevant legal framework provided by Section 434 of the Companies Act, 2013, allows for the transfer of winding-up proceedings to the NCLT. - The Court interpreted the applicability of Section 434 and considered precedents such as Action Ispat and Power P. Ltd. v. Shyam Metalics and Energy Ltd. to determine the stage at which transfer is appropriate. - Key evidence included the absence of substantive proceedings towards winding up, no appointment of liquidators, and no irreversible steps taken in the present case. - The Court applied the law to the facts by analyzing the stage of the winding-up petition and the absence of irreversible actions. - Competing arguments were presented by the petitioner, requiring a formal application for transfer, and the respondent, asserting the Court's inherent jurisdiction to transfer the matter. - The Court concluded that the winding-up petition should be transferred to the NCLT based on the respondent's explicit request, lack of irreversible steps, and alignment with legal principles and precedents.3. **Significant Holdings:** - The Court held that the absence of irreversible steps towards liquidation, the respondent's request for transfer, and the provisions of Section 434 justified transferring the petition to the NCLT. - Core principles established include the Court's discretion to transfer winding-up petitions, the importance of considering irreversible steps, and the relevance of parties' requests in transfer decisions. - The final determination was to transfer the winding-up petition to the NCLT, Delhi Bench, for further proceedings, with the electronic record to be transmitted within a week.This judgment analyzed the transfer of a winding-up petition to the NCLT under Section 434 of the Companies Act, emphasizing the stage of proceedings and the absence of irreversible actions as key factors in the transfer decision. The Court's interpretation of the legal framework, consideration of precedents, and application of law to the specific facts of the case led to the conclusion that the petition should be transferred based on the respondent's request and the lack of substantive progress towards liquidation.