9911796707
TMI Blog1993 (3) TMI 288X X X X Extracts X X X X X X X X Extracts X X X X ..... d into a consultancy services contract with the appellant-company for lay-out, drawings, engineering, tender-invitation and supervision of construction of its factory, office and connected buildings of their project in plot Nos. 223 to 226, Matsya Industrial Area, Desula, Alwar. The appellant-company was registered under the Companies Act, 1956, vide certificate of incorporation No. 3461 of 1985-86, dated November 29, 1985, as a public company limited by shares. On the basis of tenders received, the work for the construction of the factory, office and buildings connected with the project of the company at Alwar was awarded on June 15, 1987, to the Nucon India Pvt. Ltd., a construction contractor. The work under the consultancy services cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I have already issued an injunction order in that case and that injunction order, in my opinion, will also safeguard the interest of the petitioner. Connect this case with Company Petition No. 11 of 1991 and issue notice to the respondent-company returnable within two weeks as to why provisional liquidator may not be appointed." The appellant-company filed a counter-affidavit asserting that the petition filed was not bona fide having been filed with the sole object of coercing the appellant-company into making payment of amounts that were not legally due or payable, hence, the petition was liable to be rejected. The appellant-company also asserted that the claim was premature and unjustifiable and there was no neglect to pay the debt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Rules and submitted that the advertisement had not since been made, the learned company judge had no jurisdiction to go into the merits of the winding up petition and direct for winding up. Rules 96 and 99 of the Companies (Court) Rules, 1959, are reproduced below : "96. Admission of petition and directions as to advertisement. Upon the filing of the petition, it shall be posted before the judge in chambers for admission of the petition and fixing a date for the hearing thereof and for directions as to the advertisements to be published and the persons, if any, upon whom copies of the petition are to be served. The judge may, if he thinks fit, direct notice to be given to the company before giving directions as to the advertise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fected the merits. The steps required by rule 96 are of vital nature and compliance with the same appears to be mandatory. The purpose of advertisement contemplated by rule 96 is very wholesome and is meant for the benefit of all the creditors and shareholders. Winding up or liquidation is the process by which the management of a company's affairs is taken out of its directors' hands and its assets are realised by a liquidator. A company may be wound up under the Companies Act by the court on the grounds laid down in section 433. Before the winding up proceedings are taken by the creditors, not only a petition must be served upon the company, but also it must be advertised in the manner prescribed in rule 24 of the Rules. In Halsbury's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petition, and order that the petition be advertised and direct that the petition be served upon persons specified in the order. A petition for winding up cannot be placed for hearing before the court, unless the petition is advertised ; that is clear from the terms of rule 24(2). But that is not to say that as soon as the petition is admitted, it must be advertised. In answer to a notice to show cause why a petition for winding up be not admitted, the company may show cause and contend that the filing of the petition amounts to an abuse of the process of the court. If the petition is admitted, it is still open to the company to move the court that in the interest of justice or to prevent abuse of the process of the court, the petition b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appeal on the preliminary ground mentioned above, it is not necessary for us at this stage to go into the question as to whether the amount for which recovery was sought in the winding up petition was bona fide or not. In the appeal, the appellant-company was directed to hand over a bank draft of Rs. 50,000 and, the respondent was directed to furnish bank guarantee for the said amount. The appellant-company has complied with the order. We consider it appropriate to direct that the bank guarantee shall not be withdrawn by the respondent till further orders of the court. In the beginning, we have noted the order of the then learned company judge, who being of the opinion that as the company petition filed in the connected Case No. 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
