SUSHILA DEVI Vs. BASAKHA SINGH

JUDGEMENT

(1.) This is an application under Section 4.39(8) of the Companies Act 1956 read with Rule 101 of the Companies (Court) Rules and Order I, Rule 10 and Section 151 of the Code of Civil Procedure as well as Section 391 of the Companies Act. This is an application by Smt. Sushila Devi, Smt. Ganga Devi and Shri Inder Kumar Marntani directed against M/s. Basakha Singh & Co. (P)Ltd. and the official Liquidator. From the facts disclosed in the application, it appears that the applicants claim to be unpaid creditors of the company. It is stated that there are Hundis due sometime in 1966 drawn in favour of the applicants. Apparently on 13th June, 1967, a winding up petition was filed by one Gauri Dikshit in this court which was numbered as Company Petition 13 of 1967. That petition remained pending for a considerable period but there was a settlement between the petitioning creditors and the respondent company, which led to the winding up petition being withdrawn. It is stated that this settlement was recorded in C.A. 316 of 1970 and the Provisional Liquidator, who had been appointed by the court, was also discharged and all property and assets were ordered to be handed back to the company. According to the petitioner, the compromise between the company and the creditor, which took place in those proceedings, was entered into without taking into account the petitioners claim against the company. Moreover, the withdrawal of the winding up petition is stated to be due to fraudulent preference by the company. For the purpose of defending this petition, the company and the Official Liquidator have taken certain objections. As far as the Official Liquidator is concerned no reply as such has been filed but it is stated that the order passed by the Company Judge discharging the Provisional Liquidator is conclusive of the matter and the company is no longer been wound up. As far as the company itself is concerned, it is stated that the petition is no longer maintainable and other objections also have been taken. Four issues were framed which were all treated as requiring no evidence and directed to be heard as preliminary issues. The following issues were framed:

(2.) I have had the opportunity of looking at the records of C.P. 13 of 1967 wherein the Provisional Liquidator was appointed. The said petition for winding up of the company is on the ground of inability to pay debts. The proceedings terminated by an order, dated 3rd August, 1970, wherein it was stated that there had been a settlement between the creditor as well as the other creditors and the company in terms of the statements recorded in C.A. 316/70 and the petition was dismissed in terms of that settlement. This meant that the company petition came to an end on 3rd August, 1970, as a result of a settlement. I am not concerned with the correctness or otherwise of that decision. It is only sufficient to note that C.A. 316/70 has also been placed before me, which shows that a number of creditors and petitioners appeared before the court and accepted payment. The present petitioners did not, however, take part in those proceedings. There is nothing to show that the present petitioners took any part in the winding up petition.

(3.) The present petition was brought on 17th September, 1970. A question has arisefa as to how this application can be brought and as to what sort of relief the petitioners can get by moving an application of this sort. Once a winding up petition has been decided it is not possible to permit any one to become parties thereto because the proceedings are at an end. It is submitted by the learned counsel for the applicants, that, in fact, if the original petitioner withdraws a winding up petition then it is open to other persons like creditors to join the petition and support the same. For this purpose reliance is placed on Rule 101. There is no doubt that if a petitioner is found entitled to present a petition on account of not being a contributory or creditor or otherwise fails to prosecute the petition or withdraws the same or fails to appear then the court has sufficient power to enable another creditor or contributory to prosecute the petition. This does not mean that such an application can be made after the petition has been allowed to be withdrawn. The procedure in this respect is set out in Rule 99 to Rule 102 of the Companies (Court) Rules and may be summarised.