EX SUD LIMITED Vs. INDIAN ALUMINIUM CABLES LTD

JUDGEMENT

(1.) This petition raises an interesting, and at the same time an important question of law. The petitioner has obtained a foreign decree against the respondent (hereinafter referred to as ' the company') for an amount of US $ 879,750. It is an ex-parte decree of the High court of Justice Queens Bench Division, london passed on 30th April, 1993. Since the decree is by a foreign Court against an indian company, if the petitioner wanted to recover this amount, procedure contained in the Code of Civil Procedure (CPC) had to be followed. The petitioner chose not to take that recourse. Instead on the basis of this ex-parte foreign decree, it served a demand notice dated 12th July, 1993 under Section 434 of the Companies Act, 1956 (for short 'the Act') requiring the company to pay the said sum of US $ 879,750 within three weeks. On the company refusing to make this payment and contesting the same through its Advocates vide reply dated 27th July, 1993, present petition seeking winding up of the company is filed under Section 433 (e) , (f) read with Section 434 of the Act. Thus the primary ground is that the company owes debt' to the petitioner and is unable to pay the debt. The company has challenged the maintainability of such a petition filed on the basis of an ex-parte foreign decree contending that it is not a ' debt' and such a foreign decree is non est and not binding on the company who has right to contest on the grounds available to it under Section 13 of the CPC. The question, therefore, would be whether such a foreign decree would be a 'debt' and whether such a petition is maintainable

(2.) Before adverting to the aforesaid questions, we may first take note of bare facts and brief description thereof would suffice.

(3.) According to the petitioner, by an agreement contained in two telexes dated 14th 17th September, 1990 the petitioner agreed to purchase approximately 1500 Metric tonnes (MT) of EC grade aluminium rod according to the specifications and terms specifically set out in the said telexes. The express terms of the agreement were as under: