M SURYANARAYANA Vs. STILES INDIA LIMITED

JUDGEMENT

(1.) O.S.A.NO. 5 of 1998 is directed against the Judgment and order passed by the learned single Judge dated 12.8.1997 passed in C.P. No. 71 of 1996 dismissing the company petition filed by the appellant.

(2.) M/s. Stiles India Limited, the respondent herein, is a company incorporated under the Companies Act, 1956 (for short, the Act), having its registered office at Hyderabad and it is carrying on business activities at Lakshminagaram, Konangivaripalli, Tirupati-Chittoor Highway. Chandragiri Mandal, Chittoor District. The authorized capital of the respondent-company is Rs. 9 crores divided into 90 lakh equity shares of Rs. 10.00 each. The main object of the respondent- company is to carry on business of manufacture and dealing in Ceramic and Stoneware tiles. Mr. M. Suryanarayana, the appellant herein, and the petitioner in C.P. No. 71 of 1996, had worked as General Manager (Finance) in the respondent-company till the end of December, 1994 and left the company with effect from 1.1.1995. According to him, he is entitled to receive arrears of salary for a period of five months i.e., for the period from August 199 4/12/1994 at the rate of Rs. 18,500.00 per month. According to him, he is also entitled for some other amounts from the respondent-company towards Provident Fund contribution, encasement of leave salary and medical reimbursement etc., to a tune of Rs. 1,18,900.00. Thus, according to the appellant, he is entitled to receive a total sum of Rs. 2,11,400.00 from the respondent-company. Since the respondent-company did not pay the outstanding dues, the appellant issued a notice dated 17.7.1995 to the respondent-company under Section 433(e) of the Act demanding payment of a total sum of Rs. 2,11,400.00 towards the outstanding dues due from the respondent-company, and -as the respondent-company did not respond to the said notice nor pay the outstanding amounts to the appellant he filed C.P. No. 71 of 1996 under Sections 433(e) and Section 439 of the Act for winding up of the respondent-company on the ground that the respondent-company is unable to discharge its debts.

(3.) Notice before admission was ordered to the respondent- company and the respondent-company filed its counter-affidavit denying the allegations made in the Company Petition and contending that the respondent company was taken over by M/s Spartek Ceramics India Limited on the basis of the valuation done as on 30.11.1994, that even prior to that date, the appellant was not at all attending the office regularly and that he was working in some other organisation. In the counter-affidavit, it was also claimed that the respondent-company was closed for more than six months preceding 30.11.1994 when its Management was taken over by M/s Spartek Ceramics India Limited. The respondent)-company also claimed that the claim made by the appellant relates to the period during which he did not work, and when the factory was closed down. In the counter-affidavit, the respondent- company also disputed the claim of the appellant as regards Provident Fund contribution, encashment of leave salary, medical reimbursement. LTC etc., by contending that he is not entitled to receive any money under those heads. It was also contended in the counter-affidavit that the appellant, while leaving the services of the company, did not hand over the cash balance, books of accounts, minutes books and other statutory records, and that he took away a sum of Rs. 20,000.00 as advance from the respondent-company and he did not account for the same subsequently. So alleging the Management of the respondent- company contended that the Company Petition filed by the appellant is incompetent and liable to be dismissed in limine.