2014 (4) TMI 1313 - HC - Companies Law

Admission of company petition to hearing - direction for issuance for publication of the advertisement of the said petition in the Statesman (English Edition) and Jansatta (Hindi Edition) for 14.07.2014 - HELD THAT - The Respondent on 10.05.2012 sent a notice under Sections 433 and 434 of the Companies Act 1956 to the Appellant demanding a sum of Rs. 13, 09, 32, 188.73. The Appellant on 29.05.2012 replied to the notice dated 10.05.2012 seeking more time from the Respondent to clear the outstanding and expressing its willingness to make payment of the balance agreed amount in terms of the compromise decree dated 15.12.2011 if the Respondent extends the time till March 2015 and waives off the future interest. The Appellant is liable to pay the balance amount in terms of the settlement arrived at between the parties before the Debt Recovery Tribunal. Presumably for this reason no reply to the petition was filed by the Appellant despite ample opportunity being granted for the aforesaid purpose. The averments made in the petition are thus unrebutted and unchallenged. There are no infirmity in the impugned order. The order admitting the petition and issuing citation therefore calls for no interference - appeal dismissed.

Summary

Issues:
Admission of company petition, failure to file reply, settlement agreement non-compliance, dismissal of application for modification of compromise decree, demand notice under Companies Act, 1956, request for extension of time for payment, liability to pay balance amount, unrebutted averments in petition, no interference with impugned order, dismissal of appeal.

Analysis:
The judgment pertains to an appeal against an order admitting a company petition and directing publication of an advertisement. The respondent failed to file a reply despite multiple opportunities granted by the court. The petition remained uncontested, leading to the closure of the right to file a reply. The petition highlighted a settlement agreement between the parties in a debt recovery matter before the Debt Recovery Tribunal-II. The appellant failed to comply with the settlement terms by not paying the agreed instalments, leading to a dispute over outstanding dues.

The appellant's subsequent application for modification of the compromise decree was dismissed by the Debt Recovery Tribunal. Following this, the respondent issued a notice under the Companies Act, 1956, demanding payment of a substantial sum. In response, the appellant requested an extension of time until March 2015 to clear the outstanding balance as per the compromise decree, seeking a waiver of future interest. The court noted the appellant's liability to pay the balance amount as per the settlement, emphasizing the unrebutted nature of the averments in the petition due to the appellant's failure to respond.

Ultimately, the court found no infirmity in the impugned order admitting the petition and issuing citation. The judgment concluded by dismissing the appeal and associated application, affirming the validity of the original order. The decision underscores the importance of compliance with settlement agreements and timely responses to legal proceedings to avoid adverse outcomes in litigation matters.