SARITA PAWANKUMAR GOENKA Vs. JAI PRAKASH STRIPS LTD

JUDGEMENT

(1.) By this Petition, it is prayed that the Respondent Company be wound up under the provisions of the Companies Act, 1956 (hereinafter referred to as 'the Act') on the ground that the Company is unable to pay its debts.

(2.) The case of the Original Petitioner, who claimed to be the creditor of the Respondent Company, a sole Proprietor of M/s. Pragati Enterprises, is that, he had sold, delivered and supplied goods to the Respondent Company as per their request from time to time which were valued at about Rs.30,05,385/-. According to him, the Respondent Company accepted the said goods without any demurer. No grievance was made about short supply or of substandard quality of goods. However, the Respondent Company failed and neglected to pay the dues. The fact that the goods were supplied to the Respondent Company is substantiated by the invoices-some of which are appended to the Company Petition being Invoice No.38 to 49 as Exhibit A to Exhibit L. It is stated that a Statement of Account in respect of amount due and payable to the original Petitioner was sent by him alongwith his letter dated 2nd September, 1997 mentioning the outstanding amount of Rs. 30,05,387/- The Respondent Company in reply neither disputed the factum of receipt of goods nor the outstanding amount. However, in reply dated 4th September, 1997 it was merely alleged that the claim of interest of the Petitioner was untenable. In other words, the Respondent Company merely raised dispute regarding the claim of interest. The original Petitioner by its letter dated 11th September, 1997 immediately placed on record that the amount referred to in the respective invoice was payable not later than a month, failing which it would bear interest as printed in the invoice for late payment. Since no response was received from the Respondent Company, the original Petitioner sent letter dated 13th October, 1997, once again requesting the Respondent to immediately pay the outstanding amount alongwith interest without any further delay. Eventually, the original Petitioner sent legal notice through his Advocate dated 25th October, 1997 purported to be under Section 434 of the Companies Act calling upon the Respondent Company to pay sum of Rs. 30,05,385/- alongwith interest at the rate of 30% per annum within three weeks from the receipt of the notice. It is stated that the said notice was returned with postal remarks "not claimed". Therefore, the said notice was once again sent by registered AD as well as under postal certificate on 25th November, 1997. The Registered AD letter was again returned with postal endorsement "not claimed". In so far as notice sent under postal certificate was duly delivered to the Respondent Company as a consequence whereof, the Company paid a sum of Rs. 20,00,000/- without any direction for appropriation, by four separate payments of Rs. 5,00,000/- each on 20th January, 1998, 23rd January, 1998, 27th January, 1998 and 29th January, 1998. The original Petitioner appropriated the said amount towards Invoice Nos.15 to 37, and balance amount of Rs. 89,577/- towards Invoice No.38 thereby leaving the balance amount of Rs. 10,05,385/- due and payable by the Respondent Company. It is stated by the original Petitioner that inspite of repeated reminders, the Respondent Company failed and neglected to remit the balance amount of Rs. 10,05,385/- or part thereof. Therefore, a legal notice through Advocate was issued on 6th March, 1998 to be treated as statutory notice under Section 434 of the Act calling upon the Respondent to pay balance amount of Rs. 10,05,385/- together with interest at the rate of 30% per annum within 21 days from the receipt of the notice failing which action of winding up will be initiated against the Company. The said legal notice was sent by speed post AD on the registered office of the Respondent Company which was returned back with postal endorsement "intimation". Further, copy of the statutory notice was sent by registered AD, which was also returned with postal endorsement "intimation, not claimed". In the circumstances, the original Petitioner sent another legal notice dated 26th June, 1998, on this occasion by telegraphic mode through post. It was a telegraphic notice sent through Advocate stating that it was a statutory notice under Section 434 of the Act calling upon the Respondent to pay the aforesaid outstanding amount of Rs. 10,05,385/- alongwith interest at the rate of 30% per annum within 21 days from the receipt of notice, failing which winding up action of the Respondent Company would be initiated. It is stated that the Petitioner through Advocate addressed a letter dated 18th July, 1998 to the Superintendent, Central Telegraphic Office mentioning that a telegraphic notice was sent to the Respondent Company on the registered office of the company to furnish a certified copy of the telegram and also clarify whether the telegram has been received by the addressee or not as that information will have to be mentioned in the proposed Company Petition to be filed in this Court against the company. In response to the said communication, the Office Incharge of Central TO, Mumbai replied as follows: "DEPARTMENT OF TELECOMMUNICATIONS I beg to inform you that your attached telegram No.N163/27-6 handed in on the 27-6 addressed to M/s Jai Prakash Strips Limited at 17, Dehbanoo Commercial Complex, Opp. Vidyut Bhavan Nasik Road 422 101 cannot be delivered owing to refused by addressee. Office stamp Office Incharge Dated 22-7-1998 Sd/-Central T.O.Mumbai CORRECTION ON AMPLIFICATION OF ADDRESS. If any alteration in the address is necessary it can only be made by means of a paid service advice(See Telegraph Guide), delete, if necessary."

(3.) In view of the said communication and refusal to accept statutory notice by the Respondent Company, the Petitioner had no other option but to file the present Petition for winding up of the Respondent Company on the assertion that the Respondent Company is unable to pay its debts. This Petition was filed on 3rd August, 1998. The Petition was accepted and notice was issued to the Respondent Company on 3rd September, 1998. As per the order, it is noticed that Advocate for Respondent Company appeared before the Court on 25th November,1998, however, when the matter appeared for admission on 30th November, 1998, no appearance was made on behalf of the Respondent Company. On the other hand, the Petitioner tendered the affidavit of service stating that the notice sent to the Respondent Company was refused by the company. On that basis, the Court proceeded to admit the Petition and ordered advertisement of admission of the Petition in two local newspapers. It is noticed that the direction given by the Court of advertisement was complied with. During the pendency of this Petition, the original Petitioner expired on 26th April, 2005, as a result, his heirs and legal representatives were brought on record to continue the action against the Respondent Company in respect of the outstanding amount payable by the Respondent Company. The Petition eventually reached for final hearing on 14th February, 2007 till then no efforts were made by the Respondent Company to enter appearance in the Company Petition. No one appeared for the Respondent Company before the Court. However, before proceeding to pass any drastic order, the Court deferred the hearing of Petition to 28th February, 2007 as it noticed that one Advocate Navinchomal had appeared for the Company on 30th March, 1999. Advocate for the Petitioner duly served notice to Advocate Navinchomal on 20th February, 2007 informing that the matter would proceed for further hearing on 28th February, 2007. Inspite of that notice, no appearance was made before the Court on 28th February, 2007. As a result, considering the facts of the case, the Company Judge proceeded to allow the Petition in terms of prayer clauses (a)&(b) and accordingly ordered winding up of the Respondent Company as also appointed Official Liquidator to proceed in accordance with law.