HIGH COURT OF
Modi Threads
Ltd.
v.
Helam Bros.
AJAY NATH
AND ASHOK
BHUSHAN J.
SPECIAL APPEAL
NO. 188 OF 2006
March 28, 2006
Section
433 of Companies Act, 1956 - Winding up - Circumstances in which a company may
be wound up - Petitioners supplied certain goods to respondent-company -
Subsequently, petitioner filed petition seeking winding up of
respondent-company on ground that it failed to pay price of goods supplied -
Single Judge passed winding up order, however, in said order, Single Judge
recorded finding that out of alleged price of goods, a substantial part had
been paid and for balance amount payable respondent had raised objection that
goods representing that amount were sub-standard - Against said winding up
order, instant appeal was filed - Whether unless debt of petitioning creditor
is undisputed a winding up petition is not appropriate remedy - Held, yes -
Whether, since, in instant case, respondent-company had raised dispute as to
quality of goods supplied, winding up order passed at first hearing needed to
be examined a little further - Held, yes - Whether, therefore, until further
orders of court, operation of impugned order was to be stayed - Held, yes
The petitioner
/ creditor supplied certain goods to respondent-company. Subsequently, the petitioner filed winding up
petition alleging that the respondent-company failed to pay the price of goods
supplied. The Single Judge passed the
winding up order, however, at the time of passing said order, the Single Judge
recorded a finding that out of the alleged price of goods, a substantial part
had been paid and part of the price which remained outstanding, the respondent
had raised objection that goods representing that value were sub-standard. Against winding up order passed by the Single
Judge, instant appeal was filed with a delay of 35 days and prayer was also
made for filing of an opposition.
It is well
known that unless the debt of the petitioning creditor is undisputed a winding
up petition is not an appropriate remedy.
Here the statutory notice was served and a presumption was sought to be
raised; such raising of presumption is permissible only in the case of
undisputed debts. [
Moreover, on
the hearing of a petitioning creditor in a winding up petition, a winding up
order is not immediately passed. The
Companies (Court) Rules, 1959, have to be followed. A winding up petition is to be advertised; it
is to be made returnable usually not before three weeks after the date of
advertisement. Views of the creditors
and the contributories are to be invited.
According to the present law, the workers have also a right of
appearance and put forward their views.
[
As such, with
respect, the winding up order passed at the first hearing required to be examined
a little further. [
Thus, until
further orders of court, the impugned order would remain stayed. [