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TMI Blog2002 (3) TMI 819X X X X Extracts X X X X X X X X Extracts X X X X ..... 434(1)( a ) of the Companies Act, 1956, served upon the registered office of the company to which no reply was sent, and, thus, raising the presumption that the respondent-company is unable to pay its dues. 2. Notices were issued on 11-7-2000, to the respondent-company to file objections, if any, and a restraint order was passed directing that the respondent-company shall not transfer its immovable property without permission of the court. A counter affidavit of Shri S.N. Garg, authorised signatory of the respondent-company has been filed through Sri Vipin Sinha, Advocate. A rejoinder affidavit has also been filed. 3. I have heard Shri R.P. Agarwal, the learned counsel for the petitioner-company, and Sri Navin Sinha, the senior adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner-company and payable to the respondent-company, these amounts were adjusted after which there remains a debit balance of Rs. 14,953. It is contended that flats were given on rent by Motiwala Investment Co. (P.) Ltd., which has merged and stands amalgamated in M/s. Prashant Glass Works (P.) Ltd. respondent-company as per the scheme sanctioned by this Court on 20-9-1998. The rights and liabilities of Motiwala Investment Co. (P.) Ltd. stands transferred to the respondent-company. Whereas Rs. 1,623 was paid to Marwa Advertising by the respondent-company at the instance of the petitioner, Rs. 2,06,000 was to be paid by the petitioner-company towards rent of apartment Nos. 61 and 62 for Rs. 1,78,500 up to 31-3-1999, and towards apartment No. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the petitioner, and it was agreed that petitioner would pay the consolidated rent of Rs. 1,27,500 from 1-4-1996 to 30-6-1997, and give up their rights forthwith towards which fax message dated 27-3-1997, was sent by the respondent-company demanding Rs. 1,27,500 in response to which rent was remitted by the petitioner-company to the tune of Rs. 1,02,000 on 31-3-1997, and Rs. 25,500 on 1-5-1997, and, thus, discharging the entire liability. As far as the rent of flat No. 72 is concerned, it is taken on lease with effect from 17-7-1997, and was occupied by Shri Samir Rastogi, an officer of petitioner-company with the understanding that the said employee would pay rent to the respondent-company directly. The said flat was occupied up to 30-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Amalgamated Commer-cial Traders (P.) Ltd. v. A.C.K. Krishnaswami [1965] 35 Comp. Cas. 456, the Supreme Court said that if a debt is bona fide disputed, there cannot be neglect to pay within section 434(1)( a ), and if there is no neglect, the deeming provision does not come into play, and thus the ground of winding up that the company is unable to pay its debts is not substantiated. No other authority needs to be cited on this well settled proposition, and has been applied as a test in a creditor winding up petition by all the courts. The decisions cited by Shri R.P. Agarwal are not applicable to the facts of the present case. In Advent Corp. (P.) Ltd., In re [1969] 39 Comp. Cas. 463 (Bom.) a consent decree was passed whereby the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present case, there is no acknowledgement of debt. The respondent-company never, by conduct or by inference, admitted the liability. On the contrary, the petitioner-company could not deny that the rent was due, but tried to defend its liability on the ground that it cannot be made the subject-matter of adjudication in this proceeding. 10. Shri Navin Sinha, the senior advocate, has produced before the Court the last audited balance-sheet of the respondent-company for the year ending 31-3-2001. The respondent-company is a profit-making company and has shown income of Rs. 136,232,009.09 in the relevant year and profit available for appropriation is Rs. 19,805,708.78. It has fixed assets of Rs. 21,904,506.19 and investments of Rs. 14,118,5 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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