9911796707
TMI Blog2001 (8) TMI 1246X X X X Extracts X X X X X X X X Extracts X X X X ..... rs were holding two series of debentures of the respondent-company, one being 1,98,687-19.5 per cent debentures of the face value of Rs. 100 at a premium of Rs. 5 and the other being 2,00,000-14 per cent debentures of the face value of Rs. 100 at a premium of Rs. 5. 2. It is alleged by the petitioners that the respondent-company failed to pay the redemption value of the shares on maturity. There is correspondence on record to indicate that the petitioners extended the time for payment from time to time and even conditionally agreed to a reduction in the interest rate. It is the contention of the petitioners that despite accommo-dation, the respondent-company could not pay amounts aggregating to Rs. 9,63,582.65 under the first series of deb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of wages. The gross value of the fixed assets as on 30-6-1999, is Rs. 22,698 lakhs. The non-payment of the amounts, it is asserted, is due to a temporary cash crunch which is nothing but a result of the market conditions and the general slack in the economy. It is contended that this is not a fit case where a winding up petition ought to be admitted and that the winding of the company or even an order of admission of the company petition would result in serious repercussions and may bring the entire company to a grinding halt. 5. The learned counsel for the company has relied upon the following decisions in support of his contention that in these circumstances, a company petition deserves to be dismissed. (i) Rishi Enterprises, In re [1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 183 (Guj.) : "It is the case of the creditors that the company is unable to pay its debts and that it is just and equitable that the company should be wound up. The circumstances call for no proof of inability on the part of the company to pay its debts as such inability is self-evident on the admitted facts. There are huge debts, secured as well as unsecured, which, as matters stand, are far beyond the means of the company to meet. Even so, a court will exercise a sound discretion in deciding whether to wind up a company or not and in doing so consider many relevant factors. It may be that despite the inability to pay its debts, a company has still prospects of coming back to life and if the court is told of any specific proposal, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indicative of the fact that even if one or more of the grounds mentioned in section 433 is made out, and the company is unable to pay its debt, it is still not mandatory, but rests in the discretion of the court whether to make an order of winding up. The court must in each case exercise its discretion in deciding whether in the circumstances of the case, it would be in the interest of justice to wind up the company." (p. 841) 6. In light of the rival contentions, it is crystal clear that the respondent-company is a going concern doing substantial business having a huge turnover. The respondent-company is paying huge amounts as the revenue and also has a substantial asset base. The respondent-company has also from time to time paid to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he third column of the schedule hereto annexed by their respective due dates set out in the first column of the schedule, each such payment to be made strictly on or before the relevant due date. On respondent paying to the petitioners the amounts on the dates as set out in the schedule annexed hereto, the petition shall stand dismissed. (2)In the event of respondent committing any two defaults in payment of the amounts as set out in the schedule annexed hereto, the petition shall stand admitted and shall be advertised one week after written intimation to the respondent in that behalf. (3)The learned counsel on behalf of the petitioners makes a statement on instructions from its clients that the petitioners shall grant their no objection ..... X X X X Extracts X X X X X X X X Extracts X X X X
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