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TMI Blog1982 (2) TMI 265X X X X Extracts X X X X X X X X Extracts X X X X ..... plication for the appointment of a provisional liquidator is being moved, inter alia , on the ground that there was a danger to the assets of the company and there was obvious insolvency and the company had admitted that it had no defence to the petition. In so far as the ground as to the danger to the assets is concerned, there does not seem to be any averment except the extract from a certain letter. But I propose to deal with the merits of this case after I have dealt with certain preliminary objections that have been taken. The first preliminary objection that is taken by Mr. S.B. Mookherjee, appearing on behalf of the company, is that the application for the appointment of provisional liquidator is not maintainable at this stage. Reference is made to section 450 of the Companies Act, 1956, sub-section (1) whereof provides as follows : "At any time after the presentation of a winding-up petition and before the making of a winding-up order, the court may appoint the official liquidator to be liquidator provisionally." It was submitted by Mr. Mookherjee for the company that the expression "presentation of a winding-up petition" means the admission thereof by the court. Adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he summons "orders for winding-up have already been passed". In this factual background, Mr. Mookherjee contends that a new winding-up application is not maintainable by the present petitioner. In this connection Mr. Mookherjee draws my attention to a passage in Buckley on the Companies Acts, 13th edition, page 470, where the following observations occur : "If a creditor knows that a winding-up petition has been presented but fears that it will not be or finds that it is not being prosecuted with diligence, his remedy is to appear at the hearing in support of the petition and ask to be substituted under winding-up rule 37. If, instead, he chooses to present another petition, he does so at the risk of having it dismissed with cost, against him." Mr. Mookherjee submits that this principle should be invoked in the facts of this case and this application should be held to be not maintainable. I do not propose to express any final opinion on this argument also. This is for the reason that it is a well-known proposition that it is only after advertisement of the winding-up petition that the action becomes a representative one. Admittedly, on the facts of this case, the advert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have agreed to get their debts paid in instalments. It is further stated in the affidavit of Abu Zafar Md. Osman Gani affirmed on February 5, 1982, that the first instalment of nearly Rs. 4 lakhs has been paid to these creditors. According to Mr. Mookherjee, the present petitioner is one of those recalcitrant creditors who have refused to accept instalments and has made this application merely as a lever to obtain full payment at once and without any instalment. Mr. Mookherjee submits that this application should be held to be an abuse of process of this court and no order, either interim or final, should be made in this case. Having regard to all the facts and circumstances of this case as disclosed in the affidavits, I am of the view that the contention of Mr. Mookherjee should be accepted. I am fully satisfied that the company went through a temporary period of financial distress. I am further satisfied that the company has turned the corner and will be able to honour its commitments to those creditors who have come to an arrangement with the company. A very strong comment was made by Mr. Mookherjee on an aspect of this case which, though not strictly connected with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nerjee and the managing director have now fallen out and Mr. Banerjee is now openly colluding with the creditors of the company and supplying information to them for the purpose of winding-up petitions including a copy of the letter dated January 7, 1982. In my view, this contention of Mr. Mookherjee should also be upheld. In the facts of this case, I am fully satisfied that a copy of the letter of January 7, 1982, must have been given by Mr. Banerjee to the petitioning creditor or his lawyer. Therefore, this application, in my view, is not a bona fide application. Even before me, it was stated by Mr. Mookherjee on instructions that the company was willing to pay the petitioner's dues by instalments in the manner in which it is being paid to a very large number of other creditors. Mr. Biswas, appearing for the petitioner, stated before me on instructions that his client wanted all the money at once. As I have indicated, I have no manner of doubt in my mind that this is not a bona fide application but is a mere lever to obtain payment of the entire dues of the petitioner without the benefit of payment in instalments to the company. It would follow, therefore, that, in my vie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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