9911796707
TMI Blog2015 (5) TMI 485X X X X Extracts X X X X X X X X Extracts X X X X ..... o pay the outstanding amount to the Petitioner and assured the Petitioner that payment would be made shortly. According to the Petitioner, despite repeated assurances, the Company has failed to remit the outstanding dues. Accordingly, the Petitioner issued a statutory notice dated 13th May 2013, calling upon the Company to remit the admitted outstanding sum of USD 226,283.40. The Company failed to reply to the statutory notice. The Petitioner therefore filed the present Company Petition seeking winding up of the Company. 3. In its Reply to the present Company Petition, the Company has taken the stand that its purchase of goods from the Petitioner was part of a tripartite transaction between the Petitioner, Company and a third party, namely, Powerwave Technologies Inc. ("Powerwave") , an American company who appears to have been a customer of the Company and the end user of the goods supplied by the Petitioner. On this basis, it was submitted by the Company that there was an oral understanding between the Petitioner and the Company that payments to the Petitioner would only be made once monies were received from Powerwave. 4. It is also submitted on behalf of the Company that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im from the Company in regard to the alleged loss to the extent that the insurance company has made good. 7. Further, it is submitted on behalf of the Company that the claim under the Petition is not a "debt" but "damages" and, therefore, the present Petition for winding up is not maintainable. In support of this contention, the Company has relied on the following decisions: (I) Kudremukh Iron Ore Co. Ltd. vs. Kooky Roadways P. Ltd. [1986 (60) Comp Cas 1060 Kar] (ii) Greenhills Exports vs. Coffee Board, Bangalore [1986 (60) Comp Cas 1060 Kar] ; and (iii) ICICI Lombard General insurance vs. AFL P. Ltd. [2008 (141) Comp Cas 188 Bom.] 8. Lastly it is submitted on behalf of the Company that the Company is a sound, running and profitable Company employing about 1200 employees and having net fixed assets worth over Rs. 16 crores. It is submitted that it is settled law that no Company would be wound up if it is profitably running. It is therefore submitted on behalf of the Company that the Petition deserves to be dismissed with costs. 9. On the other hand, in response to the Company's first contention with respect to the tripartite nature of the transaction, it is submitted on behal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion rights of insurance companies, which rights would any way accrue to them by virtue of equity. The Petitioner has relied on the decisions in the case of (i) Mason vs. Sainbury & Anr. [2008 (141) Comp Cas 188 Bom.], (ii) Morley v. Moore (1936) 2 K.B. 359 and (iii) Yorkshire Insurance v. Nisbet Shipping Co. Ltd. (1962) 2 Q.B. 330 where the principles of subrogation with respect to insurance contracts have been considered. 12. In response to the contention raised by the Company that the payment receipt-cumsubrogation letter includes the words "assign" and "transfer", and therefore it is only the insurer who can initiate and maintain an action against the Company, the Petitioner has relied on the judgment of the Supreme Court in the case of Union of India vs. Sri Sarada Mills Ltd. AIR 1973 SC 281 and the decision of the Division Bench of the Gujarat High Court in the case of PVD Plast Mould Industries Ltd. vs. ING BHF Bank Aktiengesellschaft (2008) 144 Comp Cases 485 (Guj). 13. In relation to the Company's contention that the claims under the Petition are in the nature of 'damages' and not a 'debt' and would require to be ascertained, it is submitted on behalf of the Petitioner t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Petitioner, the Company has, in its written submissions, admitted that the fact that the Petitioner received US$ 181,026.72 from the insurance company was brought to the knowledge of the Company by the Petitioner itself. If the Petitioner had any intention of suppressing the said fact as alleged, the Petitioner would not have mentioned the same to the representative of the Company. The decision in the case of Agarwal Industries Ltd. (supra) relied upon by the Company pertained to a case where this Court took a grave view of the deliberate withholding of information by the Petitioner at the time of obtaining ex-parte ad-interim reliefs. The Petitioner in this case had filed a Summary Suit in respect of the same claim in respect of which it then filed a winding-up petition and had obtained a garnishee order in the Summary Suit whereby the insurance company was directed to withhold the payments of assured sums to the Respondents to the tune of the Petitioner's claim. The aforesaid fact was suppressed from this Court in the winding-up proceedings where an ex parte order was obtained. This Court, therefore, rightly held that the failure to disclose the filing of the Summary Su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as if it had not been paid. The question, then comes to this, can the owner, having insured, sue the hundred? Who is first liable? If the hundred, it makes no difference, if the insurer, then it is a satisfaction, and the hundred is not liable. But the contrary is evident from the nature of the contract of insurance. It is an indemnity. Every day the insurer is put in the place of the insured. In every abandonment it is so. The insurer uses the name of the insured. The case is clear, the Act puts the hundred, for civil purposes, in the place of the trespassers and, upon principles of policy, as in the case of other remedies against the hundred, I am satisfied that it is to be considered as if the insurers had not paid a farthing. Buller, Justice - Whether this case be considered on strict legal principles, or upon the more liberal principles of insurance law, the plaintiff is entitled to recover. Strictly, no notice can be taken of anything out of the record. Taken in its narrow form, the contract is only a wager, more liberally construed, it is an indemnity. Still, upon the words, and as to third persons, it is only a wager, of which third persons shall not avail themselves. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lenders obliged themselves to accept the money in settlement, and, although it was held there was no accord and satisfaction, the Court held that they had thereby disabled themselves from suing the original debtor. Here there are no facts resembling those facts, and for that reason I decline to apply a case, decided with reference to an entirely different set of facts, in circumstance to which hitherto nobody has ever suggested that it was applicable. I only want to add one other thing. I hope that the result of this judgment will be that Plaintiffs will realize that they still have whatever may be their full rights accompanied by whatever duties result from the exercise of those rights, notwithstanding arrangements made beyond the scenes between the insurance companies." Further, In the case of Yorkshire Insurance Vs. Nisbet Shipping Co. Ltd. (1962) 2 Q.B. 330, which has been considered by various Indian authorities, it was held as under: "In my view, this case turns upon what is meant by the word "subrogated" in this context. The doctrine of subrogation is not restricted to the law of insurance. Although often referred to as an "equity" it is not an exclusively equitable doctr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceeding is not maintainable on the basis that the Petitioner had already received money in lieu of its claim against the Company from the insurance company is, in my view, without any basis in law and accordingly rejected. 16. The next submission on behalf of the Company was that, in view of the phraseology of the payment receipt-cum-subrogation letter, which includes the words "assign" and "transfer", only the insurer can initiate and maintain any action against the Company. The operative part of the payment receipt-cum-subrogation form is reproduced hereunder for convenience: "In consideration of having received this payment, we hereby agree to assign, transfer and subrogate to you, to the extent of your interest, all our rights and remedies in and in respect of the subject matter insured, and to grant to you full power and give you any assistance you may reasonably require of us in the exercise of such rights and remedies in our or your name." 17. In response to the above contention, the Petitioner placed strong reliance on the decision of the Supreme Court in the case of Union of India vs. Sri Sarada Mills Ltd. (supra), which not only discussed the principles of subr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng up in PVD Plast Mould Industries Ltd. vs. ING BHF Bank Aktiengesellschaft (supra) wherein it was held as follows: " In the present matter, it is to be seen that the loan was taken by the company somewhere in the year 1993 and the company which claims to be running profit making assetful company, did not discharge its liability within the statutory period despite the demand notice and the insurance company had to discharge the liability. The endeavour of Mr. Soparkar was to convince us that if the creditor company has already received 95 per cent of the loan amount and the insurance company has not lodged its claim against the appellant company, the court must not exercise its discretion in favour of the admission of the winding up matter. The argument is one of frustration. We are unable to understand the logic behind the said argument. It is not the case of the appellant that certain goods were insured and in lieu of the goods, the money has been paid by the insurance company to the principal creditor. In fact, the loan amount/loan transaction was insured. The Petitioner cannot say that once the insurance company has paid the money to the principal creditor, then the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ky Roadways P. Ltd. (supra): In that case, it was the Petitioner's contention that there had been a short delivery of 131.63 MT of steel material, which had been entrusted to the Respondent for transportation. The Managing Director of the Respondent stated that the Respondent took full responsibility and guaranteed that he would deliver a minimum of 40 MT of steel by a particular date. Despite this, the Respondent failed to supply more than 9 MT of steel material resulting in the Petitioner filing a winding-up petition for Rs. 5.89 lakhs, on account of the short delivery by the Respondent. The Karnataka High Court held that there had been no clear admission by the Respondent Company, save and except, the communication from the Managing Director alluded to earlier. The Court, came to the view that "the letter, in whatever manner read, there is no acknowledgment of liability to pay any sum of money to the Petitioner". As a result, it was held that the claim in the winding up petition related to damages for a sum of money, which remained to be ascertained in accordance with law. Therefore, as there was no ascertainment of the sum due to the Petitioner on account of short delivery, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge to certain air-conditioning units during transportation. The insurer had duly paid Hitachi for the losses suffered and had instituted this action directly against the transporter. In its defence, the Respondent questioned the maintainability of the winding up petition on the ground that the Petitioner was seeking to recover losses and/or damages sustained on account of negligence of the Respondent. It was contended that these could only be proved in a Civil Suit and there could not therefore be a debt due or payable. This Court accordingly took the view that, unless the negligence of the Respondent Company stood established in accordance with Section 8 or Section 9 of the Carriers Act, 1865, there was no question of a debt being due, as there was no ascertained liability. Naturally therefore, whether or not negligence had been established was a matter which required evidence to be recorded, which necessitated a trial in a Civil Court. It is interesting to note that this decision refers to the judgment of the Supreme Court in Union of India Vs. Shree Sarada Mills Ltd. (supra) to state the proposition that subrogation did not confer any independent right on an underwriter to maint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt-cum-subrogation form is untenable and rejected. The Petitioner is entitled to maintain the present Petition and pursue the Company in respect of the entire claimed amount. As has been correctly submitted by the Petitioner, if any payments are made by the Company, the Petitioner is fully entitled to receive such monies subject to the right of the insurer to recover any sums paid which are in excess of the Petitioner's losses. However, such matters between the insurer and the Petitioner would be the subject matter of independent proceedings and we need not delve further into these at the stage of admission of the present Company Petition. In any event, this cannot constitute a defence for the Company not paying its dues. The Company would be released from its obligations vis-a-vis its pending dues the moment it makes payment to the Petitioner. The expressed fear that the insurer would also pursue the Company for such sums is entirely untenable and unfounded. Even if the Petitioner was intent on being unjustly enriched by seeking payment from the insurer (which it has received to the stated extent) and again seeking payment from the Company behind the back of the insurer, it do ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
