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TMI Blog2015 (3) TMI 196X X X X Extracts X X X X X X X X Extracts X X X X ..... mpanies. Notwithstanding the respondent's contention that it owed only a sum of Rs. 1,56,00,000/- to the petitioners, the respondent offered to pay the petitioners an aggregate sum of Rs. 1,79,00,000/-. The respondent has offered to pay the said amount because the respondent had already issued cheques for the said amount in favour of the petitioner companies, which had been dishonored. And, proceedings under section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'NI Act') had been instituted by the petitioners with respect to the dishonored instruments. 2. The controversy that needs to be addressed in the present petitions is whether the defense raised by the respondent company is bonafide or a sham defence. And, whether the petition is maintainable in view of the offer made by the respondent to pay an amount of Rs. 1,79,00,000/- to the petitioner. Co. Pet No.373/2012 3. Brief relevant facts with respect to Co. Pet No. 373/2012 are as follows:- 3.1 The petitioner company supplied various iron and steel products to the respondent company as per the agreed specifications. The petitioner had raised various bills for the materials supplied and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the respondent company. Thereafter, the petitioner filed the present winding up petition on the ground that the respondent company was deemed to be unable to pay its debts as the respondent had failed to pay the amount of Rs. 1,03,18,917/- along with late payment charges, which were alleged to be admittedly due, despite service of the statutory notice. 3.4 The respondent has disputed three invoices being invoice nos. 161, 162 and 163 dated 20.07.2011 for an aggregate sum of Rs. 5,62,771/-. The respondent has also raised disputes with respect to the quality of the goods supplied by the petitioner and in that respect had also raised a debit note for a sum of Rs. 20,20,431/-. Co. Pet. No.375/2012 4. Brief relevant facts with respect to Co. Pet No. 375/2012 are as follows:- 4.1 The petitioner company supplied various iron and steel products to the respondent company as per agreed specifications. The petitioner had raised various bills for the materials supplied and the petitioner has provided the details of the invoices which have remained unpaid. It is stated that the respondent company has failed to make the payment of the bills amounting to Rs. 1,18,11,927/- despite receivin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4.4 The respondent filed a reply to the petition, raising disputes regarding the quality of goods supplied by the petitioner and further stated that the amount claimed by the petitioner did not account for a debit note dated 14.11.2011 for an amount of Rs. 1,72,108/-. The respondent also disputed the bill nos.83 & 84 dated 08.12.2011, bill nos.90 & 92 dated 20.12.2011 and bill nos. 93 & 94 dated 21.12.2011 aggregating Rs. 36,65,042/- Submissions 5. It was contended by the learned counsel for the petitioners that the respondent has failed and neglected to pay the amount due and payable by the respondent company, towards the goods supplied by the petitioner along with the late payment charges, despite service of the statutory notice. The learned counsel for the petitioner also emphasized that the respondent had issued cheques, which were dishonored. It was submitted that the cheques issued by the respondent clearly indicated that the respondent was indebted to the petitioners. 6. The petitioner also claimed that it was entitled to late payment charges at the rate of 4% per month. It was submitted that the late payment charges has been mentioned in the invoices and, therefore, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the respondent. It was further contended that the delayed payment charges @4% per month were unconscionable and in any event could not be enforced by the petitioner. 10. It was submitted that the present petitions were not maintainable as the respondent was fully capable of making payments to its creditors. The learned counsel also submitted that the tender of demand drafts for the amounts in excess of the admitted dues, amply demonstrated that the respondent was not insolvent and was capable to discharge its debts. 11. I have heard the learned counsel for the parties. 12. A petition for the winding up of the company under Section 433(e) of the Act is maintainable if the company is unable to pay its debt. A company is deemed to be unable to pay its debt, if a demand is made on the company for the amount due and payable by the company and the company has failed and neglected to pay its debt. However, there can be no presumption of inability to pay debts where the same are not accepted as such. Where the company is solvent and claim raised by the creditor is disputed by the respondent company, then a proceeding for winding up is not maintainable. 13. In the present case, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and having received the Debit Notes your clients have refused to adjust the said debits and have been insisting, and pressurizing my clients to make the entire payments, without adjusting the debit notes and, have further been pressurizing my client to make payment of further Interest @4%, though there has been no such agreement or understanding for the delayed payment between my clients and the said representative of your client SH. DEVI DAYAL GARG." 14. Although, there appears to be some disputes with regard to the quality of goods, however, substantial parts of the amount claimed by the petitioner is undisputedly payable by the respondent. And, the respondent not only tendered the amount as admitted by it but also tendered the amount disputed by the respondent for which debit notes were issued. This itself indicates that the respondent company is able to pay its debts and could not be considered as commercially insolvent. 15. The second issue is with respect to the late payment charges claimed by the petitioner. The petitioner claims that interest at the rate of 4% per month is payable by the respondent on the delayed payment. It is contended by the petitioner that the said r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rest to the petitioner on its failure to make payment of the bill within a specified time. ...... In my opinion, in the absence of any agreement between the parties, the dispute which the respondent has raised regarding its liability to pay interest cannot be treated as a fictitious or frivolous dispute. There is sufficient justification in the claim of the respondent that the dispute is a bona fide dispute. It is also to be noted that the petitioner has not even said that the parties had agreed for payment within a particular time period. In the absence of such an agreement, the claim made by the petitioner for his right to get interest at the rate of 18 per cent. or 21 per cent. cannot be treated as an admitted debt. Thus, I am clearly of the opinion that the respondent has raised a dispute of substantial nature and it is not possible to hold that the respondent has failed to pay debt due from it." A single judge of this court has concurred with the aforesaid view in Naptha Resins & Chemicals Ltd. v. Flow- Tech Air (P) Ltd.: [2003] 4 Comp LJ 489 (Delhi). 17. In view of the controversy with regard to the delayed payment charges claimed by the petitioner, the same can by no stret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uced as a debt collecting agency or as a means of bringing improper pressure on the company to pay a bona fide disputed debt. Of late, we have seen several instances where the jurisdiction of the Company Court is being abused by filing winding-up petitions to pressurise the companies to pay the debts which are substantially disputed and the courts are very casual in issuing notices and ordering publication in the newspapers which may attract adverse publicity. Remember, an action may lie in appropriate court in respect of the injury to reputation caused by maliciously and unreasonably commencing liquidation proceedings against a company and later dismissed when a proper defence is made out on substantial grounds. A creditor's winding-up petition implies insolvency and is likely to damage the company's creditworthiness or its financial standing with its creditors or customers and even among the public. ** ** ** 35. A Company Court, therefore, should act with circumspection, care and caution and examine as to whether an attempt is made to pressurise the company to pay a debt which is substantially disputed. A Company Court, therefore, should be guarded from such vexatious a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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