TMI Blog1996 (8) TMI 401X X X X Extracts X X X X X X X X Extracts X X X X ..... ai Shah, who has filed this petition for order of winding up of Presto Finance Ltd. The petitioner is carrying on business of investment. The respondent-company, Presto Finance Ltd. was incor-porated under the provisions of the Act, and its registered office is at Ahmedabad. The respondent-company was established for the following objects: " 1. To carry on the business as finance company and to assist in or to finance and to carry on all kinds of financial operations including but without limiting the generality of the foregoing, long-term/short-term loans, seed capital, bridge loan, working capital, bill discounting, bill purchasing and hire purchase, deferred payment, instalment sales and lease operations of all kinds and types, equity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 88,000 was issued by the company in favour of the petitioner. The said cheque on presen-tation came to be bounced firstly, on 22-1-1996, and secondly, on 30-1-1996. On both the occasions, the cheque came to be returned on the ground of arrangement being exceeded. It is, therefore, the case of the petitioner that the company has failed to discharge its obligation as there was clear failure on the part of the respondent-company to discharge its financial liability. 5. The petitioner, thereafter, was obliged to issue a statutory notice under section 434(1) of the Act dated 2-2-1996 demanding an amount of Rs. 88,000 along with agreed rate of interest, within 21 days from the receipt of the notice. However, a reply dated 27-2-1996 was re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the creditors. A list of some of the creditors to whom cheques were given and bounced back for insufficient funds is produced along with the affidavit of the petition- er. There are about 23 creditors who are not paid their dues by the respondent-company. In fact, this petition is one of the 10 petitions and other 9 creditors have also moved this Court for winding up order against the respondent company. 7. It will be also interesting to mention that the Stock Exchange, Ahmedabad has also taken action against the respondent company. On account of the action taken by the Stock Exchange, trading in company's shares has been suspended and its shares have been delisted. Not only that, the Stock Exchange has also issued a public notice warn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has also filed affidavit, nobody has filed affidavit on behalf of the respondent company. On the contrary, it is an admitted fact that the petitioner-company had given a cheque of Rs. 55,000 and the respondent company only requested for one month's time for payment of Rs. 55,000 along with interest which amounted to Rs. 88,000. Therefore, more than sufficient time has elapsed, but no payment is made. Nothing is shown which would even remotely suggest or indicate that the respondent company is in a position to pay the dues of the petitioner company. 10. Section 433 of the Act reads as follows: " 433. Circumstances in which company may be wound up by Court. - A company may be wound up by the Court, ( a )if the company has, by specia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 days period, in the reply given late, undoubtedly the dues are admitted and it was requested by the respon- dent company through its lawyer in the reply to the statutory notice, which is on record, to give one months time which was also given. In such a situation, the presumption has to be raised about the inability to pay the dues of the petitioner-company. No doubt, in order to raise the presump-tion of inability to pay it is not enough to show that the company has omitted to pay the debt despite service of statutory notice. It must be further shown that the company has omitted to pay without reasonable excuse. The petitioner has successfully shown that not only the respon- dent company has not paid its debt, but has also shown the inab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitions. 14. Section 434 reads as under: " Company when deemed unable to pay its debts. - (1) A company shall be deemed to be unable to pay its debts ( a )if a creditor, by assignment or otherwise, to whom the company is indebted in a sum exceeding five hundred rupees then due, has served on the company, by causing it to be delivered at its registered office, by registered post or otherwise, a demand under his hand requiring the company to pay the sum so due and the company has for three weeks thereafter neglected to pay the sum, or to secure or compound for it to the reasonable satisfaction of the creditor; ( b )if execution or other process issued on a decree or order of any Court in favour of a creditor of the company is ret ..... X X X X Extracts X X X X X X X X Extracts X X X X
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