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TMI Blog2012 (11) TMI 303X X X X Extracts X X X X X X X X Extracts X X X X ..... of the claim was itself pending and awaiting decision of the arbitrator. Pursuant to our order the appellant already secured the entire claim through bank guarantee. Respondent is permitted to withdraw the amount through encashment of bank guarantee by giving counter guarantee for the same. The Registrar would hold the same till disposal of the arbitration proceeding and would get it renewed from time to time - This is not a fit and proper case to wind up the appellant company - Order of admission of the winding up proceeding is set aside. - A.P.O. NOS. 289 & 299 OF 2012, C.P. NO. 297 OF 2009 - - - Dated:- 13-8-2012 - ASHIM KUMAR BANERJEE AND SHUKLA KABIR SINHA, JJ. Tilak Bose, Soumava Ghosh and Anil Dhar for the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng for the said sum. The learned Single Judge dismissed the Writ Petition by observing, "for issuing a mandamus, crystallization of a legal right would be the basis. The document relied upon by the petitioner is full of incursions and interpolations which are apparently not been certified by any authority." The learned Judge referred to the document at page 17. A Writ appeal was filed. The Division Bench observed, "without entering into the merits of the case, we are only inclined to grant liberty to the appellant to submit a representation to the Chairman-Cum-Managing Director of the respondent Company to deal with the facet of payment and if the same is admitted, the authority shall act accordingly. In any case, the representation shall b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the post admission stage. The learned Judge did not have any other option but to pass an order of winding up that would give rise to the other appeal being A.P.O. No. 299 of 2012. The learned Judge recorded, "a casual prayer is made on behalf of the company for extension of time to file its Affidavit-in-Opposition at the post advertisement stage. It is almost taken for granted that since the company is a Government Company any prayer made for extension of time of any length would be taken as a command by Court and slavishly followed. These Government Organizations and their officers must be disabused of such impression as of yesterday." His Lordship declined to extend the time and passed an order of winding up. Pertinent to note, despite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntitle him to defend that is to say, although the affidavit does not positively and immediately make it clear that he had a defence, yet, it was such a state of facts as leads to the inference that at the trial of the action he may be able to establish a defence to the plaintiff's claim the plaintiff is not entitled to judgment and the defendant is entitled to leave to defend but in such a case the Court may in its discretion impose conditions as to the time or mode of trial but not as to payment into Court or furnishing security. (e) If the defendant has no defence or the defence is illusory or sham practically moonshine then although ordinarily the plaintiff is entitled to leave to sign judgment, the Court may protect the plaintiff by o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t so passed for payment. He prayed for appropriate order for encashment of the bank guarantee in protanto satisfaction of his claim. 6. The conduct of the appellant company was deplorable. They took it for granted that the Court would show lenience to the appellant because of their governmental status. The appellant did not take the proceeding seriously. The aspect of arbitration was never highlighted before His Lordship at least, we do not find any such eventuality. When the petition was admitted the company should have been vigilant enough to prefer appeal. Earlier defective appeal was dismissed with liberty to prefer the appeal afresh that was done at a belated stage. The appellant did not file affidavit at the post admission stage. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the additional quantity in accordance with the provisions of Section 73 of the Indian Contract Act. We also find that the claim in the arbitration would relate to the identical amount being value of the final bill that was sought to be passed by the appellant company. It is admitted position arbitration is still pending and awaiting its disposal. 9. The decision in the case of Haryana Telecom Ltd. v. Sterlite Industries (India) Ltd. [1999] 22 SCL 156 (SC) would be of no assistance to us. In the said decision the issue was raised as to whether a winding up proceeding could be stayed under Section 8 of the Arbitration and Conciliation Act, 1996. The Apex Court observed that the power of winding up of a company was conferred on the Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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