2018 (12) TMI 1309 - HC - Companies Law

Winding up petition - recovery of dues - liability to pay the dues of the petitioner - Held that - It is clear that the averments being made in the preliminary submission and the averments in the reply are mutually contradictory, evasive and only an attempt to wriggle out of the liability to pay the dues of the petitioner. Hence, admissions can be inferred from vague and evasive denials or admissions can even be inferred from the facts and circumstances of the case. In view of the above, the defence set up by the respondent is clearly not bonafide. The reply/defence is vague and evasive. The averments are also contradictory. There is clearly no dispute raised in this case by the respondent. Accordingly, I admit the present petition. The Official Liquidator attached to this Court is appointed as the Provisional Liquidator. He is directed to take over all the assets, books of accounts and records of the respondent-company forthwith. The citations be published in the Delhi editions of the newspapers Statesman (English) and Veer Arjun (Hindi), as well as in the Delhi Gazette, at least 14 days prior to the next date of hearing.

Summary

Issues:
Petition under section 433(e) and 434 of the Companies Act, 1956 for winding up of the respondent company based on outstanding dues of the petitioner for security services provided.

Analysis:
1. The petitioner provided security services to the respondent from November 2013 to December 2015, raising invoices totaling ?2,94,606, of which only ?82,318 was paid, leaving an outstanding amount of ?2,12,288. The respondent did not dispute the invoices but failed to release full payment, leading to the petition for winding up.

2. The respondent's reply presented contradictory statements. In the preliminary submission, it admitted to availing security services from the petitioner for other factories, highlighting the petitioner's defaults in paying dues of workmen. However, in the reply on merit, the respondent denied engaging the petitioner for security services at its corporate office, refuting the existence of any agreement or services provided.

3. The court noted the contradictory nature of the respondent's submissions, emphasizing the importance of scrutinizing pleadings for unequivocal admissions. Citing previous judgments, the court highlighted that vague and evasive denials could imply admissions, especially when inconsistent statements are made.

4. Referring to legal precedents, the court emphasized that a genuine dispute must exist for a winding-up petition to be dismissed. In this case, as the respondent failed to raise a substantial dispute regarding the outstanding dues, the court admitted the petition for winding up. The Official Liquidator was appointed as the Provisional Liquidator to take over the assets and records of the respondent company.

5. The court granted a six-week period for the respondent to pay the outstanding dues. If the amount of ?2,12,288 was paid within this period, the order appointing the Official Liquidator as the provisional liquidator would be recalled, providing an opportunity for settlement before further liquidation proceedings.

6. The court directed the publication of citations in newspapers and the Delhi Gazette, and mandated the petitioner to deposit a sum towards the cost of publication. The Official Liquidator was tasked with inventorying assets, sealing premises, valuing assets, and seizing bank accounts to facilitate the winding-up process.

7. The judgment underscored the need for genuine disputes to be raised to avoid misuse of winding-up petitions, ensuring a fair and transparent resolution of outstanding dues between parties involved.