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TMI Blog2013 (1) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to pay its debts. Its existence would cause threat to the commercial world. In favour of respondent - A.P.O. No. 211, 213 of 2011 C.P. No. 241, 242 of 2009 - - - Dated:- 23-7-2012 - ASHIM KUMAR BANERJEE, AND SHUKLA KABIR (SINHA), JJ. For the Appellants: Mr. Abhrajit Mitra (Advocate) Mr. Jishnu Choudhury, (Advocate) Mr. Chayan Gupta, (Advocate) Ms. Debasree Saha, (Advocate) For the Respondents: Mr. P.C. Sen, (Senior Advocate) Mr. D.N. Chowdhury, (Advocate) Mr. Sandeep Kr. Dutta, (Advocate) ASHIM KUMAR BANERJEE.J: Facts of this case, if brought within a short campus, would depict, M/s. Kamalapur Sugar Industries Limited, a company incorporated under the provisions of Companies Act, 1956 was a debtor in respect of a secured claim of a Nationalised Financial Institution being Dena Bank to the extent of Rs.17.03 crores approximately apart from interest at the rate of 15.5 % per annum at quarterly rest with effect from September 30, 2004. The Bank initially approached the Debt Recovery Tribunal and ultimately obtained a certificate to the above extent. The company preferred an appeal, however did not proceed with the same and the Appellate Tribunal dismissed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observing it as infructuous in view of the fact that the winding up notice had already been published in newspaper after admission and the winding up petition took a representative character by that time. Their Lordships however, granted liberty to the company to raise all available pleas at the time of final hearing. The matter came up for final hearing before the learned Company Judge. The company reiterated the pleas which they had taken at the time of admission, including the one that the winding up petition was a premature one in absence of a quantified undisputed debt being a pre-requisite of maintaining a winding up proceeding. In effect, the Company challenged the winding up proceeding at its threshold on the ground of maintainability. Upon hearing rival contentions the learned Judge allowed the winding up proceeding and passed an order of winding up as against the Company vide judgment and order dated July 30, 2010 appearing at pages 159-170 of the paper book. His Lordship held the winding up petition maintainable on the ground that there was just claim which could be enforced giving rise to a winding up proceeding in terms of Section 434(1)(a) and (b) of the said Act of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as was held by the learned single Judge of this Court in the case of Rameswar Prosad Kejriwal Sons Ltd. VS- M/s. Garodia Hardware Stores reported in 2002 Volume-II Calcutta Law Times Page-59. Mr. Mitra relied on the following decisions: i) Mt. Jeuna Bahu Others VS- Parmeshwar Narayan Mahta Ors. (All India Reporter 1918 Privy Council Page-159) ii) Mt. Sukra VS- Ram Harakh Anr. (All India Reporter 1951 Allahabad Page-195) iii) Badat Company, Bombay VS- East India Trading Company (All India Reporter 1964 Supreme Court Page- 538) iv) Ram Ranjan Chakravarti VS- Indra Narain Dass (1996 Indian Law Reporter Volume-33 Calcutta Page-890) v) State Level Committee Another VS- Morgardshammar India Ltd. (1996 Volume-I Supreme Court Cases Page-108) vi) Som Dev Ors. VS- Rati Ram Anr. (All India Reporter 2006 Supreme Court Page-3297) Per contra, Mr. P.C. Sen, learned senior counsel appearing for the Bank contended that a recovery certificate issued by the Debt Recovery Tribunal was a result of a special proceeding under a special statute and could not be equated with a decree of a Civil Court passed under Order 34 of the Code of Civil Procedure. Mr. Sen conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .R. on the doctrine of bonafide dispute. The passage being apt, is quoted below : The rule, is no doubt, that when the debt is undisputed and is of sufficient amount then he has a right to obtain payment by winding up petition, if he has given a statutory notice. Then we have to consider what is the meaning of a debt being undisputed. As I said in this case, there was no reasonable excuse for refusal to pay this debt or neglecting to pay it, but was there under a mistake in law, a bonafide dispute, something which should have prevented him from presenting the winding up petition? I do not think there was. I have looked through the correspondence and I must say, I have come to the conclusion that writers of the letters on the part of those who disputed the claim of Mr. Batty had no clear idea of their position. They stated in one letter one thing, and in another letter, but none of the letters appeared to me to amount to this: We dispute your debt on any one of these grounds. They said in one letter, you did not lend it to our clients . In another letter, we have received no notice of your claim and cannot admit any claim against these persons without evidence in support of i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mand being raised in accordance with the provisions of Section 434. The Apex Court relied on a passage from Palmer s Company precedents, a winding up petition is a perfectly proper remedy for enforcing payment of debt. It is the mode of execution which Court gives to a creditor against a company unable to pay its debts . In the case of Unique Cardboard Box Manufacturing Ltd. (Supra), the learned single Judge of this Court considered an identical issue wherein a winding up petition was sought to be maintained on a claim made as per an ex parte decree passed by a civil Court. The learned Judge observed, Sub-section 1(a) would make it clear that if a notice was served by the company regarding payment of any debt due to the creditor and such debt was not satisfied within the stipulated period the company would be deemed to be unable to pay its debt. His Lordship further held that Sub-section 1(b) was disjunctive and alternative ground for deemed insolvency. In the case of Rameswar Prasad (supra), another learned single Judge of our Court considered a winding up petition based on a decree passed beyond three years considering the date of the decree and the date of presentation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions were cited to support his contention that the winding up petition could not be held to be maintainable unless the remedy was exhausted as provided under Order 34. We find that such issue was answered by our Division Bench in the case of Maxlux Glass Pvt. Ltd. (supra). Our Division Bench considering the earlier Apex Court decision on the issue rejected such contention raised by and on behalf of the Company. On the doctrine of merger Mr. Mitra relied on a passage from Halsbury s Laws of England. The passage would denote the defence of judgment recovered , arising as it does out of res judicata, has much in common with estoppel by record, although it is not founded upon it. A claimant who has once sued a defendant to judgment cannot, while the judgment stands, though unsatisfied, sue him again for the same cause, not because he is estopped from doing so (although he, as well as the defendant, is estopped from averring anything contrary to the record), but because the cause of action is merged in the judgment, which creates an obligation of a higher nature. It is also probably true to say that a person who has once recovered judgment for a sum of money is estopped from ave ..... X X X X Extracts X X X X X X X X Extracts X X X X
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