RATHI BARS LTD Vs. DEEPAK CASTING LTD

JUDGEMENT

(1.) The present appeal is directed against the order dated 7th January, 2003 passed by the learned Company Judge in a winding up petition filed by the respondent herein, petitioner in CP No.201/2000 praying, inter alia, for winding up of the appellant company on account of its inability to pay the acknowledged dues of Rs.55,88,589/- payable to the respondent . By the impugned order, the learned Company Judge has held that the winding up petition preferred by the respondent is maintainable and as an interim measure, the appellant company has been directed to deposit the principal sum of Rs.43,75,630/- in court within four weeks from the date of the impugned order. Aggrieved by the said order, the appellant company has preferred the present appeal.

(2.) The brief facts of the case, as culled out from the record are that the respondent issued a statutory notice dated 7th January, 2000 under Section 434 (1) (a) of the Companies Act, 1956 (for short `the Act') to the appellant company calling upon it to pay an amount of Rs.60 lacs to the respondent. Prior to issuance of the said statutory notice, vide letter dated 11th January, 1999, the appellant company acknowledged the outstanding dues of Rs.55,88,589/- as being payable to the respondent. However, in its reply dated 29th January, 2000 issued by the by the appellant company, it referred to two earlier letters dated 8th December and 29th December, 1999 stated to have been sent to the respondent, denying its liability to pay any amount to the respondent. It is pertinent to note that the aforesaid two letters were, however, neither annexed to the aforesaid reply dated 29th January, 2000 issued by the appellant company nor were the same filed alongwith the reply/counter affidavit filed before the Company Court and in fact, the same were produced in court on 7th January, 2003 and sought to be tendered in the course of arguments on the ground that they could be discovered only on the said date.

(3.) In view of the refusal on the part of the appellant company to discharge its outstanding dues payable to the respondent, a winding up petition was preferred by the respondent to which a reply was filed by the appellant company wherein it raised the question of maintainability of the winding up petition. It was submitted that in view of the fact that the goods supplied by the respondent to the appellant company were defective and the winding up petition was based on amounts claimed on the basis of a running account, the petition was not maintainable. Submitting that the winding up petition based on a running account is not maintainable and that only a civil suit is maintainable, it was argued before the learned Company Judge that the winding up petition should be dismissed as not being maintainable. The said submissions were, however, rejected by the Company Court. After going through the records and considering the submissions of both the parties, it was held that the dispute in respect of the debt sought to be raised by the appellant company cannot be termed as `a bona fide dispute' and that no correspondence or any document of any nature was brought on record or even averred to exist by the learned counsel for the appellant company in respect of such defective goods. Further, the learned Company Judge referred to the acknowledgment of debt by the appellant company contained in its letter dated 11th January, 1999, issued by the Manager (Accounts) of the appellant company and also reproduced in the impugned order, wherein the appellant company acknowledged the credit balance of Rs.55,88,589/- in favour of the respondent as on 31st December, 1998. Holding that the foundation of the winding up petition is 14 days credit facility and acknowledgment of the amount by the appellant company, the learned Company Judge arrived at the conclusion that the winding up petition is founded on the above letter dated 11th January, 1999 and not based on a running account and further that nothing had been placed on record by the appellant company to show that the aforesaid amount of Rs.55,88,589/- as acknowledged in the letter dated 11th January, 1999 was thereafter paid to the respondent.