TARAI FOODS LTD Vs. WIMPY INTERNATIONAL PVT LTD

JUDGEMENT

(1.) This petition is seeking winding up of the respondent company invoking Sections 433(e), 434 and 439 of the Companies Act, 1956 (in short 'the Act'). Primarily it is Section 433(e) which is invoked as the main ground is that the respondent is indebted to the petitioner in the sum of Rs.5,95,873.20p. besides interest, which has not been paid in spite of service of statutory notice and, therefore, deeming provision contained in Section 434 is also invoked, namely, it be deemed that the respondent company is unable to pay this debt.

(2.) As per the averments contained in the petition, the petitioner had been supplying frozen French fries (hereinafter referred to as the 'said material') to the respondent company against orders placed. In fact, the respondent had made inquiries vide its letter dated 24th January 1996 from the petitioner with regard to the petitioner's ability to deliver the said material to the respondent at its various restaurants located in Delhi, Chandigarh, Jalandhar and Ludhiana. Inquiries about commercial terms and conditions of the supplies were also made. Thereafter vide fax letter dated 1st August 1996 the respondent sent its specifications pertaining to the material to be supplied. The petitioner vide its letter dated 12th August 1996 quoted its rates for the supply of the said material of the specifications needed by the respondent. Rates submitted were Rs.52/- per Kg. + taxes Ex their cold storage at Okhla, New Delhi. Thereupon an agreement was arrived at between the parties and the petitioner vide letter dated 20th August 1996 agreed to supply the said material to the respondent as per the specifications, terms and conditions set out in the said letter. According to the petitioner, their representative visited the respondent's the restaurant at Connaught Place, New Delhi and demonstrated the manner in which the said material supplied by the petitioner was to be fried with particular emphasis on the temperature to be maintained, oil level and the type of oil to be used. The respondent's personnel were also informed of the necessity of storing the said material in the deep freezer at the cold storage at the basement at ideal temperature required to maintain the quality of the product. After satisfying itself about the demonstration the respondent placed purchase order No. 070 dated 23rd August 1996 for supply of 15,000 Kgs. of the said material at the unit price of Rs.52/- per Kg. for a total sum of Rs.7,80,000/-. As per the terms of payment, it was to be made within 30 days after receipt of bill along with duly receipted challans. The petitioner supplied various quantities of the said material from time to time pursuant to the purchaser orders. According to the petitioner, the amount against following invoices has not been paid:- <FRM>JUDGEMENT_131_AD(DEL)8_2005Html1.htm</FRM>

(3.) Various reminders were issued to the respondent from November 1996 onward vide letter dated 9th January 1997 and 11th February 1997. The respondent promised to clear the dues of the petitioner but did not make the payment. When the matter was pursued further, for the first time vide letter dated 15th April 1997 the respondent took the plea that the material supplied by the petitioner was not up to the required standard. This was refuted by the petitioner vide letter dated 20th April 1997 explaining the entire position. As no payment was made even thereafter, legal notice dated 8th July 1997 was sent to the respondent calling upon the respondent to make payment of the aforesaid amount along with interest @ 18% per annum. However, instead of making the payment the respondent vide its letter dated 31st July 1997 denied the payment on patently false grounds without any factual basis and, therefore, this petition has been filed seeking winding up of the respondent company.