Home Case Index All Cases Companies Law Companies Law + HC Companies Law - 2019 (8) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (8) TMI 223 - HC - Companies LawScope the term “Creditor” - Termination of agreement - Stock Purchase Agreement - scope of assignment - HELD THAT:- In the instant case, there is no dispute or disagreement that the main company petition was presented in this Court on 15.7.2016 after termination of the master services agreement on 15.1.2016. This takes us to the covenant captioned 'Term and Termination' in the Master Services Agreement and the relevant clause is 4.4 captioned 'Effects of Termination'. A perusal of effects of termination adumbrated therein reveals that it has been covenanted that upon expiration or termination of master services agreement, all obligations of parties shall cease with the exception of obligations that accrued prior to the effective date of termination which shall survive and Agilis shall deliver all deliverables of Megasoft, besides, Agilis being under obligation to destroy all originals and copies belonging to Megasoft if so directed by Megasoft. After such termination on 15.1.2016, statutory notice inter-alia under Section 434(1) of the said Act was issued on 31.3.2016 followed by another demand on 17.6.2016. This position is admitted by Megasoft in the application filed in support of the instant application. The effect of stock purchase agreement dated 03.12.2013 cannot be said to be assignment of master services agreement or performance contemplated thereunder by Agilis to Infogix. To be noted, assignment of master services agreement or performance thereunder alone cannot be done without prior written consent of Megasoft. In the instant case, it is a demand made post termination, i.e., demand vide a statutory notice under said Act. Therefore, there are two reasons as to why the argument of Megasoft is unacceptable. One is, clause 7.5 captioned 'Assignment', extracted supra, stood terminated. The second reason is, it is not an assignment of agreement or performance contemplated thereunder. Interpretation of statute - expression 'creditor, by assignment or otherwise', occurring in sub-section (1) Clause (a) of Section 434 of the said Act - HELD THAT:- The term 'creditor' is not a term of art qua said Act. In other words, it is not a term which is defined in the said Act. In Harinagar Sugar Mills Co. Ltd. case, Supreme Court held that the expression 'otherwise' takes in any person to whom another becomes indebted howsoever the relationship of creditor and debtor is brought about between them - the stock purchase agreement dated 03.12.2013 certainly qualifies and neatly / snugly fits into the expression 'otherwise' occurring in Section 434(1)(a) of the said Act. Agilis is alive - HELD THAT:- As I have already negatived the argument that Infogix does not qualify to maintain this company petition on the ground that it had stepped into the shoes of Agilis and in the light of the fact that it neatly / snugly fits into the expression 'otherwise' by applying Harinagar Sugar Mills Co. Ltd. principle laid down by Supreme Court, the submission that Agilis is still alive is of no consequence. In the instant case, in the light of whether the petitioner in the main company petition is a creditor qua respondent also is a triable issue and it cannot be answered on affidavits and counter affidavits. Therefore, it is made clear that this question is not decided finally one way or the other in this order, but it is held to be a triable issue which is left open to be conclusively decided when the main company petition is tested / tried on merits. Application dismissed.
|