ANIL VASUDEV SALGAONKAR Vs. KERMEEN FOODS P. LTD.

JUDGEMENT

(1.) OUR learned brother, Talati J., has, by the order under appeal (Kermeen Foods P. Ltd., In re : Anil Vassudev Salgaonkar v. Kermeen Foods P. Ltd. [1984] 56 Comp Cas 445 (Guj)), summarily dismissed a petition for winding up the respondent -company, Kermeen Foods P. Ltd. The winding up was sought on the ground that the company was unable to pay its debts and also on the ground that it would be just and equitable that the company be wound up, grounds falling within s. 433(e) and (f) of the Companies Act, 1956. The Companies (Court) Rules, 1959, provide for the form in which a petition for winding up has to be filed and the procedure to be adopted thereupon. Rule 96 in Part III of the Companies (Court) Rules, 1959, provides for admission of petition and that rule reads : '96. Admission of petition and Directions as to advertisement. - Upon the filing of the petition, it shall be posted before the Judge in Chambers for admission of the petition and fixing a date for the hearing thereof and for directions as to the advertisements to be published and the persons, if any, upon whom copies of the petition are to be served. The judge may, if he thinks fit, direct notice to be given to the Company before giving directions as to the advertisement of the petition.'

(2.) EVIDENTLY , the posting of the petition for admission is contemplated by sub -s. (8) of s. 439 of the Companies Act which provides that before a petition for winding up a company presented by a contingent or prospective creditor is admitted, the leave of the court shall be obtained for the admission of the petition and further that such leave shall not be granted unless the conditions specified therein are satisfied. It is evident from r. 96 that admission is contemplated for every petition for winding up whether it be by a prospective or contingent creditor or by any one else eligible to apply for winding up. In the case of a prospective or by any one else eligible to apply for winding up. In the case of a prospective or contingent creditor before the admission is made, leave also has to be obtained and the guidelines for grant of such leave are indicated in s. 439(8) of the Act.

(3.) THE petitioner's case is that in 1977, the petitioner, at the request of Shri V. V. Keshkamat, the chairman and the managing director of the respondent company, gave certain guarantees to the Central Bank of India, the State Bank India and the Gujarat State Financial Corporation, on behalf of the respondent company, in connection with certain advances made by these institutions and as a result of this the petitioner has committed himself to a contingent liability of about Rs. 50 lakhs. It is said that the company has ceased to function by or about the year 1979. The respondent company had been formed to carry on business in sea foods at Veraval and due to various reasons the business had to be closed. It is the agreed case that for about five years past, the respondent company has not carried on any business. It is also the agreed case that most of the creditors of the company, namely, the banks and the financing institutions, have taken proceedings for recovery of money and the respondent company has not yet paid such dues. It is the petitioner's case that he may be ultimately held liable for the debts of the respondent company in view of the guarantees given by him despite the fact that in the litigations, the petitioner has taken up the stand that due to the subsequent creditor, the petitioner claims to be entitled to move for winding up under s. 439(1)(b) which contemplates any creditor or creditors moving a winding up petition and the term 'creditor' includes any contingent or prospective creditor under s. 439(1)(b).