9911796707
TMI Blog1977 (9) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... pplication was admitted and notice thereof was directed to be published. On 30th of June, 1976, when the case was placed for direction regarding fixing of a date of appearance, the Company appeared and applied for stay of publication of the notice and for dismissal of the application itself and stay of publication was ordered. Affidavits and further affidavits have been filed by either side thereafter and the matter was adjourned several times at the request of parties. Ultimately it was heard on 19-8-1977 and at the request of parties, was further adjourned to 2-9-1977, when the hearing was completed and orders were reserved. 2. The short facts leading to the making of the application are these: The Company was incorporated as a Public ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eges that a notice as required under Section 434 of the Act has been given and notwithstanding the admitted liability, the Company has failed to satisfy the debt. Accordingly it has been alleged that the Company is commercially insolvent and unable to pay its debt and it is just, equitable and convenient that the Company may be wound up. 3. The Company does not dispute the Creditor's allegation that the latter undertook execution of contracts. It has been pleaded by the Company that though the work was for stipulated sum of ₹ 7,85,000)/- they (the creditor) had already been paid an extra sum of more than a lakh and forty-five thousand rupees and the claim raised by the Creditor for the excess dues had never been agreed upon and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Having heard learned Counsel for both sides at length, I am of the view that the dues of the Creditor have nowhere been admitted as such. It is true that the Creditor has laid claim for additional payments for extra work done by it. It is also true that the Creditor maintains that a part of its dues under earlier bills are still awaiting payment. The stand of Mr. Patnaik for the Company is that over and above the agreed amount, payments have been made. Even if the Creditor's entitlement to extra payment is found, adjustments are necessary and what exactly the Company would be owing to the Creditor is yet to be ascertained. Be has relied upon the arbitration clause in the agreement which runs thus: All disputes and differences arising ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eeking to enforce payment of a debt which is bona fide disputed by the Company. The petition presented ostensibly for a winding up order but really to exercise pressure will be dismissed and under circumstances may be stigmatised as a scandalous abuse of the process of the Court. At one time petitions founded on disputed debt were directed to stand over till the debt was established by action. If, however, there was no reason to believe that the debt, if established, would not be paid, the petition was dismissed. The modern practice has been to dismiss such petitions. If the debt was bona fide disputed, there cannot be neglect to pay within the meaning of Section 431(1)(a) of the Act. If there was no neglect, the deeming provision does not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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