9911796707
TMI Blog2005 (1) TMI 400X X X X Extracts X X X X X X X X Extracts X X X X ..... re and sale of pulp, paper, board and other articles. The purchase orders inter alia stiuplated that payment will be made within 60 days/90 days sight through UCO Bank, Brajarajnagar and overdue interest payable at the rate of 16 per cent per annum. In terms of the said purchase orders, the petitioner supplied the goods to the company but the price of the goods amounting to Rs. 69,29,104 as well as interest at the rate of 16 per cent per annum totalling to Rs. 9,44,042.01 was not paid to the petitioner by the company. By a registered notice dated 20-8-1999 served at the registered office of the company at Brajarajnagar, Jharsuguda, the petitioner called upon the company through his advocate to make payment of Rs. 80,58,801.51 within three weeks, but the company did not make the said payment. The petitioner has therefore filed this petition as a creditor for winding up of the company by the Court under the provisions of the Companies Act, 1956. 3. The case of the petitioner in Comp. Act No. 22 of 2000 is that the petitioner supplied Ferric Alum Grade II and Non-ferric Alum to the company and the company paid part of the price of such goods but did not pay a sum of Rs. 4,40,311 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mills Co. Ltd. v. Stepan Chemicals Ltd. [1986] 60 Comp. Cas. 1046 , wherein it has been held that where a petition is presented for winding up of the company on the ground that it is unable to pay its debt and the company admits its liability and pays it up, the forum of company Judge is the appropriate forum for determining as to whether the creditor is entitled to interest on the amount in question or not. Mr. Patra and Mr. Mukherji submitted that this Court therefore can also decide in these winding up petitions as to whether the company which has already paid up the principal amounts to the petitioner is also liable for interest to the petitioners. 8. Mr. K.K. Jena, learned counsel appearing for the company in Comp. Act Case No. 25 of 1999, on the other hand, cited Buckley on The Companies Acts, 12th Edition, for the proposition that a winding up petition is not a legitimate means of seeking to enforce payment of a debt which is bona fide disputed by the company. He submitted that the company admitted its debt towards the principal amount and has paid it to the petitioner but bona fide disputes its liability to pay interest to the petitioner and the winding up petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Bench of the Punjab Haryana High Court turned down this contention and held : "In our opinion, where the company Judge was seized of the matter and when the liability to pay the principal debt had not been disputed by the company sought to be wound up and, in fact, paid up the debt in order to avoid winding up, the forum of the company Judge is the appropriate forum for determining as to whether the creditor was entitled to interest on the amount in question or not. The basic policy of law is to avoid multiplicity of litigation." (p. 704) This decision of the Division Bench of the Punjab Haryana High Court was followed by the Company Judge of the Punjab Haryana High Court in Delhi Cloth General Mills Co. Ltd. v. Stephen Chemicals Ltd. [1986] 60 Comp. Cas. 1046 and it was held therein that if after the filing of the petition under section 439 of the Companies Act, 1956 the company pays the principal amount during the pendency of the petition but does not pay the interest, the company can be ordered to be wound up. 11. In Buckley on The Companies Acts, however, the English law is stated that a winding up petition is not a legitimate means of seeking to enforce t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n disputed by the Company. Section 4 of the Act, 1993 both before and after its amendment by the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings (Amendment) Act, 1998 is quoted hereinbelow : Before the Amendment Act of 1998 "4. Date from which and rate at which interest is payable. Where any buyer fails to make payment of the amount to the supplier, as required under section 3, the buyer shall, notwithstanding anything contained in any agreement between the buyer and the supplier or in any law for the time being in force, be liable to pay interest to the supplier on that amount from the appointed day or, as the case may be, from the date immediately following the date agreed upon, at such rate which is five per cent points above the floor rate for comparable lending. Explanation . For the purposes of this section, "floor rate for comparable lending" means the highest of the minimum lending rates charged by scheduled banks (not being co-operative banks) on credit limits in accordance with the directions given or issued to banking companies generally by the Reserve Bank of India under the Banking Regulation Act, 1949." After the Amendme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dment in 1998, the said section 6 has been renumbered as sub-section (1) of section 6 and a new sub-section (2) has been introduced in section 6 to the effect that notwithstanding anything contained in sub-section (1), any party to a dispute may make a reference to the Industry Facilitation Council for acting as an arbitrator or conciliator in respect of the matters referred to in that sub-section and the provisions of the Arbitration and Conciliation Act, 1996 shall apply to such dispute as if the arbitration or conciliation were pursuant to an arbitration agreement referred to in sub-section (1) of section 7 of the said Act, 1996. These provisions in section 6 of the Act, 1993 on which Mr. K.K. Jena, learned counsel for the Company has placed great reliance do not affect in any manner the liability of the company to pay interest to the petitioners under sections 4 and 5 of the Act, 1993. These provisions in section 6 are merely procedural provisions as to the forum before whom a dispute with regard to the principal amount together with interest thereon can be decided between a buyer and a supplier which is a small scale industry. 14. The interest amounts as claimed by the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X
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