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In the Matter Of: Seksaria Cotton Mills Ltd. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtMumbai High Court
Decided On
Judge
Reported in[1969]39CompCas47(Bom)
ActsCompanies Act
AppellantIn the Matter Of: Seksaria Cotton Mills Ltd.
Excerpt:
- .....asked the court to do. all the same, i am prepared to make an order which, in my opinion, will, whilst protecting the right of the petitioner and other creditors, will whilst protecting the rights of the petitioner and other creditors, will whilst protecting the right s of the petitioner and other creditors, give the necessary time to the company to work out and place before the court any scheme which it might be in a position to evolve in the near future. i accordingly order that the petition be admitted, but that it be future. i accordingly order that the petition be admitted, but that it be not advertised for a period of twelve weeks form to-day. it will there-after be advertised for a period of twelve weeks from to-day. it will there after be advertised in the times of india and.....
Judgment:

Vimadalal, J.

1. This is a petition for winding up the Seksaria Cotton Mills Ltd., inter alia, on the ground of non-compliance with the statutory notice that has been given by the petitioner under section 434(1)(a) of the Companies Act. Mr. Khambatta has sought to contend that the company is not commercially insolvent and that its financial position is not such as to be unable to pay its debts. The petitioner's debt is an undisputed debt and, as stated in Palmer's Company Law 20th edition, page 697, the court will not listen to such a deface where the debt is undisputed. In the judgment delivered by me in In re Advent Corporation Pvt. Ltd. [1969] 39 Com. Cas. 463 in Company Petition No. 80 of 1968 on 19th September, 1968. I have taken the view that once there is non-compliance with a statutory notice, and the court comes to the conclusion that there is no bona fide dispute in regard to the petitioner's debt, the creditor is entitled to a winding up order ex debito justitiae. This contention of Mr. Khambatta must, therefore, be rejected.

2. Mr. Khambatta has next contended, though it is not the case made out in the affidavit in reply filed on this petition, that he should be given time to work out a compromise or arrangement under which the mills can be worked. There is however, nothing concerted placed before the court by way of a scheme which would justify me in refusing to admit the petition on this ground and postponing the dame, as Mr. Khambatta has asked the court to do. All the same, I am prepared to make an order which, in my opinion, will, whilst protecting the right of the petitioner and other creditors, will whilst protecting the rights of the petitioner and other creditors, will whilst protecting the right s of the petitioner and other creditors, give the necessary time to the company to work out and place before the court any scheme which it might be in a position to evolve in the near future. I accordingly order that the petition be admitted, but that it be future. I accordingly order that the petition be admitted, but that it be not advertised for a period of twelve weeks form to-day. It will there-after be advertised for a period of twelve weeks from to-day. It will there after be advertised in the Times of India and in the Lokasatta and in the Maharashtra Government Gazette, unless further orders of the court are obtained by the company in the meantime.

3. I may state that I have not permitted the Kamgar Margadarshak Samitee, which is a registered union of workers, to appear at the hearing of this petition as, in my opinion, it is only individual creditors who can appear, and not a labour union even though it may be registered or may , by reason of such registration, have rights under the industrial law to appear before industrial tribunals. Cost of the petition will be cost in the cause.


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