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Madhu Trading Company Vs. International Instruments Ltd. and anr. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtKarnataka High Court
Decided On
Case NumberCompany Petition No. 54 of 1980
Judge
Reported in[1982]52CompCas305(Kar)
ActsCompanies Act, 1956 - Sections 433 and 439(1)
AppellantMadhu Trading Company
Respondentinternational Instruments Ltd. and anr.
Appellant AdvocateR.D. Kolekar, Adv.
Respondent AdvocateUdaya Holla, Adv.
Excerpt:
.....is a fresh grant, though it breathes life into previous grant, as per existing provisions of act. - i am satisfied that the respondent-company is commercially solvent and is withholding the payment of bills of the petitioner-firm as it appears to have a tenable defence against the claim......to go into the merits of the rival contentions in these summary proceedings. i am satisfied that the respondent-company is commercially solvent and is withholding the payment of bills of the petitioner-firm as it appears to have a tenable defence against the claim. 5. in these circumstances, it is not appropriate for this court to pass a winding-up order nor adjudicate upon the claim. it will be open to the petitioner to file an appropriate suit in a competent civil court and recover whatever may be due. 6. with this observation, this petition is rejected as one in which this court in its discretion should not pass the winding-up order having regard to the commercial solvency of the respondent-company.
Judgment:

Chandrakantaraj Urs, J.

1. This is a petition under s. 433(e) and (f) read with s. 439(1)(b) of the Companies Act, 1956 (hereinafter referred to as 'the Act'). The petitioner's case is that a sum of Rs. 22,920.53 is due by the respondent-company in respect of certain stationery supplied against the order of the respondent-company. It is stated that the petitioner had issued a statutory notice to the respondent demanding payment but the amount claimed had not been paid within the period prescribed. Therefore, the prayer is to pass order winding-up the company as it is unable to pay its debts.

2. The petition has been resisted by the respondent-company. In the objections filed, the respondent has stated that one of its employees in collusion with the petitioner committed fraud and the bills referred to in the petition have been submitted against stationery not duly delivered to the respondent-company. The respondent has further pointed out the financial soundness of the company and its activities, actually demonstrating its commercial solvency with reference to the last audited balance-sheet of the company.

3. Sri Kolekar, learned counsel for the petitioner, had been permitted to file a reply controverting many of the allegations made against the petitioner in the statement of objections.

4. It is necessary to go into the merits of the rival contentions in these summary proceedings. I am satisfied that the respondent-company is commercially solvent and is withholding the payment of bills of the petitioner-firm as it appears to have a tenable defence against the claim.

5. In these circumstances, it is not appropriate for this court to pass a winding-up order nor adjudicate upon the claim. It will be open to the petitioner to file an appropriate suit in a competent civil court and recover whatever may be due.

6. With this observation, this petition is rejected as one in which this court in its discretion should not pass the winding-up order having regard to the commercial solvency of the respondent-company.


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