RISHI ENTERPRISES BOMBAY Vs. STATE OF GUJARAT

JUDGEMENT

(1.) Mr. Raval, learned Advocate appearing on behalf of the petitioners, vehemently submitted that once the Company fails to pay undisputed amount, then this Court should admit the petitions and should not adjourn them. According to his submissions, this Court has absolutely limited discretion. For that purpose he has relied upon the decision of the Supreme Court in the case of M. Gordhandas and Co. v. Madhu Woollen Indus. P. Ltd., 42 Company Cases 125.

(2.) In my view, there is no such absolute law, Section itself confers judicial discretion upon the Courts. In the present case, it seems that the only to coerce the Company and extract from it immediately by any means the amount which is payable to the petitioners. There is no such law that a Company which is a running company employing about 500 employees who are paid their wages regularly and which is having business of crores of rupees every year should be brought to a grinding halt by admitting these petitions only because it is in some financial difficulty at the moment. On the contrary even in those cases where the Company is closed, it has been laid down that it is the duty of the Court to welcome revival rather than affirm the death of the Company. It has been also held that it would not be right to say that creditors can insist on winding up of the Company by the Court as a matter of right if the position of the Company is such that it would be unable to pay its debt to them even if the Company can be resurrect. The petitioning creditor cannot be permitted to insist for a pound of flesh from the Company which may be a death blow to the Company only on the ground that for a temporary period a running Company is not in a position to pay the debt. This would be clear from the following decisions of this Court.

(3.) . In the case of New Swadeshi Mills of Ahmedabad v. Dye-Chem. Corpn., 59 Company Cases 183, Division Bench of this Court in O. J. Appeal No. 11 of 1984 has held as under :