PIONEER POLYFEB LTD Vs. GOYAL MG GASES LTD

JUDGEMENT

(1.) The petitioner had supplied certain material, namely, HDPE pipes of certain specifications to the respondent (hereinafter referred to as 'the company') and raised invoices numbers 33, 34, 35 & 36 of dated 21st May, 1999 for a sum of Rs. 4,44,540/- each and invoices numbers 37 and 38, both dated 22nd May, 1999 for a sum of Rs. 4,00,086/- each and invoice No. 39 dated 22nd May, 1999 for a sum of Rs. 3,85,268/-. According to the petitioner, total amount payable against these invoices was Rs. 29,63,600/-. The company, however, paid Rs. 2,50,000/-, that too belatedly and after much persuasion on 13th March, 2000 and even when vide letter dated 2nd August, 2000 the petitioner agreed to allow a special discount of 8% on the accepted basic price, excise duty @ 16% and CST @ 1% on extra balance of 2000 metres of 33mm OD PE-80 HDPE pipes, balance of Rs. 19,49,600/- has not been paid. Statutory notice dated 9th May, 2002 was served for payment of the aforesaid amount along with interest and the envelope was returned with the remarks 'refused to accept' which amounts to deemed service. On the ground that the company has not paid the sum and is unable to the pay the same, present petition is filed seeking winding up of the company.

(2.) The transaction, as per the petitioner's version, is explained in brief above. However, in the petition the petitioner has given details of the transaction between the parties which led issuance of Letter of Intent dated 28th January, 1999 by the company to the petitioner for supply of the material and Letter of Intent dated 2nd February, 1999 for supplying, laying, erection and commissioning. The petitioner has also given the details of the communications exhanged between them after the supply and erection of the material and has itself stated that certain disputes were raised by the company although the petitioner blames the company for the same. Further, according to the petitioner itself, the company had written letters blaming the petitioner for delay in the execution of laying, erection and commissioning of the work and ultimately vide letter dated 27th October, 1999 terminated the contract and requested the petitioner to refund a sum of Rs. 7,79,520/- paid to the petitioner by the company stating the termination was necessitated because of delay in completion of the work. However, the petitioner treats the said termination of the contract as arbitrary and mala fide and, therefore, it replied vide letter dated 10th December, 1999 refuting the stand of the company. Subsequently, it also wrote letters dated 5th January and 11th March, 2000 and asked for release of the balance payments. Reminders were also sent thereafter. It is also mentioned that further correspondence took place between the parties for setting the issues with respect to payments and supply of the balance quantity of material to the company. Some discussions ensued and ultimately the petitioner agreed to give certain discount vide letter dated 2nd August, 2000 as noted above. Joint meetings were also held but did not yield any result and as the company was not making payments, notices were sent demanding the payment.

(3.) Particulars of the correspondence exchanged between the parties are not stated in detail as the narration of facts disclosed by the petitioner itself would show that there are serious disputes between the parties regarding supply of the material and commissioning thereof. In fact as disclosed by the company in its reply, the contract between the parties contains an arbitration agreement as per which disputes arising out the said contract are to be settled by means of arbitration in terms of the following clause: