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TMI Blog2002 (5) TMI 802X X X X Extracts X X X X X X X X Extracts X X X X ..... for a sum of Rs. 47,74,242. It appears from the impugned order also that the learned company judge gave liberty to the petitioning creditor/appellant to institute such proceedings as it may be advised to realise its alleged dues against the company, if any, either by way of interest or otherwise. Liberty was also given to the respondent-company to pay a sum of Rs. 5,00,000 on or before 28-2-2002. It was further directed that the balance sum shall be paid by the company in monthly instalments of Rs. 5,00,000 and the first of such instalment shall commence on and from 15-3-2002 and thereafter on the 15th of each month till the entire dues were paid. In default of any of the payments, as directed, the petitioning creditor/appellant shall be at liberty to publish advertisements once in The Statesman and once in Bartaman and however publication in the Official Gazette was dispensed with. Feeling aggrieved by the impugned order of the learned company judge refusing to grant interest at the rate of 21 per cent per annum after expiry of 60 days from the submission of the bill in question, this appeal has been preferred by the petitioning creditor/appellant. Before us, Mr. Basak, learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he impugned order by the respondent. Mr. Basak appearing on behalf of the respondent-company however submitted on instruction before us that the company being aggrieved by the finding of the learned company judge, was intending to file an appeal against the self-same impugned order. Be that as it may, we are unable to accept this submission of Mr. Tiwari, appearing on behalf of the appellant. It is well settled that an appellate court shall make any order which ought to have been passed or made to pass or make such further order as the case may require, and this power may be exercised by the court notwithstanding that the appeal was as to part only of the order and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties might not have filed any appeal or objection. (see Order 41, rule 33 of the Code of Civil Procedure). Therefore, when we find that the jurisdiction of the company court to entertain an application for winding up of the company at the instance of an unregistered partnership firm was an issue, we must keep in mind the provisions of Order 41, rule 33 of the Code of Civil Procedure, as noted hereinearlier. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... modes. From a plain reading of the aforesaid provisions as made in section 425 of the Companies Act, winding up is a means by which the dissolution of a company is brought about and its assets realised and applied in payment of its debts and after satisfaction of the debts the balance if any, is paid back to the members in proportion to the contribution made by them to the capital of the company. Chapter II deals with winding up by the court and cases in which company may be wound up by the court. Section 433 of the Companies Act deals with circumstances in which company may be wound up by court. They are as follows : (a)if the company has, by special resolution, resolved that the company may be wound up by the court ; (b)if default is made in delivering the statutory report to the Registrar or in holding the statutory meeting ; (c)if the company does not commence its business within a year from its incorporation, or suspends its business for a whole year ; (d)if the number of members is reduced, in the case of a public company, below seven, and in the case of a private company, below two; (e)if the company is unable to pay its debts ; (f)if the court is of opinion that it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 433 and its sub-sections of the Companies Act, it is clear to us that section 433 only empowers the court to pass an order of winding up of a company in appropriate cases. It is also clear from the provisions made in section 433 of the Companies Act that the principle to be followed in a winding up petition by the court is that there is no right to a party to claim winding up on the basis of any agreement between the company and the said party. The power to winding up a company is only conferred on the court if the court is satisfied that the circumstances mentioned in section 433 of the Companies Act were available to a person to obtain an order of winding up from the court. At this stage we may also deal with section 439 of the Companies Act as quoted herein earlier. From a plain reading of the aforesaid provision made in section 439 of the Companies Act, we are of the view that there is no restriction for an unregistered partnership firm for presenting a winding up petition as the only restriction made in that section is stated in clauses (a) to (f) of section 439 of the Companies Act which conditions in our view, cannot be made applicable to an unregistered partnership firm. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 69(1) clearly prohibits a suit to be instituted to enforce a right arising from a contract or conferred by the Partnership Act, in any court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been partnership in the firm unless the firm is registered and the person suing is or has been shown in the register of firms as a partner in the firm. Therefore, it can be safely concluded that section 69(1) of the Partnership Act prohibits a suit to be instituted to enforce a right arising from a contract or conferred by the Partnership Act by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to have been partners of the firm unless the firm is registered and the persons suing are or have been shown in the register of firms as a partner in the firm. So far as the present case is concerned, it is an admitted position that a winding up petition was filed by an unregistered firm against a third party. Therefore, in our view, section 69(1) cannot be applied to the facts and circumstances of this case as it is an admitted position that the petitioning creditor being an unregistered par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubt that if the winding up petition is construed to be a "suit", in that case a decree shall follow but it is an admitted position that no decree is passed against an order passed by a learned company judge in a winding up petition under section 433 of the Companies Act. Therefore, there is no question of treating the winding up proceeding as a suit as that question cannot arise at all. Even assuming that the winding up petition can be treated to be a suit, whether such a winding up petition could be instituted to enforce a right arising from a contract or conferred by the Partnership Act. Let us, therefore, consider whether in a winding up petition the unregistered partnership firm is seeking enforcement of a right arising from a contract or conferred by the Partnership Act. In our view, section 69(2) of the Partnership Act cannot stand in the way of an unregistered partnership firm to make an application for winding up of the company because in our view such a winding up petition was not filed to enforce a right arising from a contract. It is now well settled that in a winding up petition, the court is only required to decide whether the company is commercially solvent or insolve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 998] 7 SCC 184 the Supreme Court dealt with this aspect of the matter, though in that decision the Supreme Court was not considering a petition for winding up by an unregistered partnership firm but in our view, the principles laid down in the said decision for filing a suit for recovery of possession based on a statutory right of the plaintiff could be squarely applicable to the facts and circumstances of this case. In that decision the plaintiff in the clearest terms had based its cause of action also on the law of the land and also the cause of action emanating from the alleged breach of the covenant on the part of the defendant. So far as the second part is concerned that is to say cause of action emanating from the alleged breach of the covenant on the part of defendant, the Supreme Court held that no suit for recovery of possession could be held to be maintainable in law in view of the bar under section 69(2) of the Partnership Act. But the Supreme Court in that decision at the same time also laid down the principle that a suit filed at the instance of an unregistered partnership firm which was based on a statutory right under the provisions of Transfer of Property Act under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. So far as this second part of the cause of action is concerned, it cannot certainly be said that it is arising out of the erstwhile contract." (p. 206) 5. Relying on and following the principles laid down by the Supreme Court in the aforesaid decision viz., in the case of Raptakos Brett & Co. Ltd. (supra), we are of the view that in a winding up petition by an unregistered partnership firm against the respondent who was a third party was not barred by section 69(2) of the Partnership Act. In our view, the application for winding up filed by an unregistered partnership firm was based on the statutory right under section 433 read with section 439 of the Companies Act. In view of our discussions made hereinearlier, and applying the principles laid down in the aforesaid decision of the Supreme Court and other decisions as discussed hereinabove, we are of the view that the enforcement of that right under the Companies Act has nothing to do with the contract between the parties. The decision of the Supreme Court in the case of Raptakos Brett & Co. Ltd. (supra) was again noticed by the apex court of our country in the case of Haldiram Bhujiawala v. Anand Kumar Deepak Kumar AIR 2000 SC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpression "right arising from a contract" occurring under section 69(3) of the Indian Partnership Act. But the learned judge has also found that the remedy, which is provided in the Companies Act for winding up of a company is a statutory remedy, and such a remedy has been provided in public interest. According to the learned judge, the right on the basis of which the said remedy was sought for in that case was arising out of a contract entered into by the parties. The learned judge further held that since the petitioning creditor was praying for winding up of the company on its failure to pay the debt of the firm it would be difficult to say that the petitioning creditor had not filed the winding up proceeding to enforce its right arising from the contract. Although the learned judge found that remedy for winding up may be statutory but the right to get an order for winding up was based on a contract for supply of goods and the winding up petition was filed for the alleged non-payment of the price of goods sold and delivered. So far as the decision of the Supreme Court in the case of Raptakos Brett & Co. Ltd. (supra) was concerned, the learned judge found that in the facts of that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ip firm was seeking enforcement of its legal right to possession against the erstwhile lessee flowing from the provisions of section 108(q) read with section 111(a) of the Transfer of Property Act which in turn also sought to enforce the corresponding statutory obligation of the defendant under the very same statutory provisions. Applying this principle in the present case we are of the view that the appellant was seeking enforcement of its legal right to get an order of winding up of a company from the provisions of section 433 of the Companies Act. In the case of Haldiram Bhujiawala (supra) in paragraph 28 of the said decision at page 1293 after discussing the decision of the Supreme Court in Raptakos Brett & Co. Ltd.'s case (supra) and the law on the point came to a conclusion of law that if a suit is based on infringement of statutory right under the Trade Marks Act, the said suit is not for enforcement of any rights arising out of a contract entered into by or on behalf of the unregistered firm with third parties in the course of the firm's business transactions and accordingly the suit was not barred under section 69(2) of the Partnership Act. In the present case the winding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nst the impugned order by which the aforesaid findings were made by the learned company judge. That apart the appeal has been preferred not by Mr. Basak's client but by the petitioning creditor against the order refusing to grant interest. Such being the position we are unable to permit the respondent to raise this question at this stage. 7. Let us now revert back to the question, which was argued on behalf of the appellant on the merits of this appeal. According to Mr. Tiwari, appearing on behalf of the appellant, the finding of the learned company judge that there was no evidence that the interest was calculated at the agreed rate or that no particulars in respect to computation of interest were produced either by annexing the copy of the same or by producing the same before the learned company judge, was not correct in the facts and circumstances of this case. It is true that from the claim made in the winding up petition the petitioning creditor was entitled to interest at 21 per cent per annum after expiry of 80 days from the date of submission. The learned judge however did not grant interest in the absence of any evidence to that extent. The only document that was produced ..... X X X X Extracts X X X X X X X X Extracts X X X X
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