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2015 (12) TMI 1134 - HC - Companies LawWinding up petition - Held that - The Company Petition is admitted and made returnable on 4 January 2016. The Petitioner is directed to advertise the Petition in two local newspapers, viz. Free Press Journal (in English) and Nav- Shakti (in Marathi) and also in Maharashtra Government Gazette. Any delay in publication of the advertisement in the Maharashtra Government Gazette, and any resultant inadequacy of the notice shall not invalidate such advertisement or notice and shall not constitute non-compliance with this direction or with the Companies (Court) Rules, 1959. The Petitioner shall deposit an amount of ₹ 10,000/- with the Prothonotary and Senior Master of this Court towards the publication charges, within a period of two weeks from the date of this order, with intimation to the Company Registrar. After the advertisements are issued, the balance, if any, shall be refunded to the Petitioner. Notice under Rule 28 of the Companies (Court) Rules is dispensed with by the company.
Issues Involved:
1. Privity of Contract 2. Inadequate Stamp Duty 3. Absence of Certificate by Authorized Officer Issue-wise Detailed Analysis: 1. Privity of Contract The Respondent argued that the corporate guarantee was executed with the Hong Kong branch of the Petitioner bank, suggesting that there was no privity of contract between the Respondent and the Petitioner's head or corporate office in India. The Respondent cited the Supreme Court judgment in *Agencia Commercial International Ltd. vs Custodian of the Branches of Banco Nacional Ultramarino* and the Calcutta High Court decision in *Chainrup Sampatram vs Punjab and Sind Bank* to support this claim. However, the court clarified that these cases pertained to jurisdictional issues and the situs of debt, not privity of contract. The court emphasized that the corporate guarantee was executed by the Respondent in favor of the Petitioner bank, described as having its registered office in Vadodara and corporate office in Mumbai, acting through its Hong Kong branch. Thus, the privity of contract existed with ICICI Bank Ltd., and the Hong Kong branch acted merely as an agent. 2. Inadequate Stamp Duty The Respondent contended that the corporate guarantee was inadequately stamped and thus inadmissible in evidence in Maharashtra. The guarantee was stamped with Rs. 100 in Gujarat, which was adequate there but not in Maharashtra. The court pointed out that the Company Court, in winding up proceedings, is concerned with the company's inability to pay its debts, not the admissibility of documents in evidence. The court noted that the debt could be enforced in Gujarat where the document was adequately stamped. Therefore, the inadequacy of stamp duty in Maharashtra did not constitute a valid defense against the winding-up petition. 3. Absence of Certificate by Authorized Officer The Respondent argued that the absence of a certificate by an authorized officer of the Petitioner, as required by the corporate guarantee, rendered the claim invalid. The court clarified that while such a certificate would be conclusive evidence of the amount due, it was not the only form of evidence. The Petitioner provided overwhelming evidence of the dues, making the absence of the certificate immaterial. The court noted that the Respondent had acknowledged the debt in various communications and balance sheets, and there was no bona fide dispute regarding the debt. Conclusion The court found no valid defense to the Respondent's liability. The Respondent had executed a corporate guarantee and acknowledged the debt in multiple documents. The Petitioner disclosed all payments made by the principal borrower, and the outstanding debt was clearly established. Consequently, the court admitted the company petition and directed it to be advertised, while granting the Respondent a four-week period before issuing the advertisement. Order: 1. The Company Petition is admitted and returnable on January 4, 2016. 2. The Petitioner is to advertise the Petition in specified newspapers and the Maharashtra Government Gazette. 3. The Petitioner must deposit Rs. 10,000 towards publication charges. 4. Notice under Rule 28 of the Companies (Court) Rules is dispensed with. 5. The Petitioner is directed not to issue any advertisement for four weeks from the date of the order.
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