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TMI Blog2011 (3) TMI 1457X X X X Extracts X X X X X X X X Extracts X X X X ..... o incorporated and established under the laws of Czech Republic. The above purchase price was to be paid by the Purchaser company in terms of clause 3.1.1. in four instalments. The said clause is reproduced hereinbelow :- "3.1.1.1 Payment of Purchase Price. The Purchase Price up to the agreed amount shall be paid to the Seller's account as follows :- (i )First instalment - The first instalment in the amount of 50,000,000-CZK (fifty million Czech Crowns) shall be paid into the Seller's Account within 3 (three) months after the Start of Construction but not earlier than 15 (fifteen) working days after the Registration Date. (ii)Second instalment - The second instalment in the amount of 50,000,000-CZK (fifty million Czech Crowns) shall be paid into the Seller's Account within 6 (six) months after the Start of Construction. (iii)Third instalment - The third instalment in the amount of 50,000,000-CZK (fifty million Czech Crowns) shall be paid into the Seller's Account within 12 (twelve) months after the Start of Construction. (iv)Fourth instalment - The fourth instalment in the amount of 80,000,000-CZK (eighty million Czech Crowns) shall be paid into the Seller's Account at the lat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t from the Seller that its claim has not been satisfied by the Purchaser within the deadline specified or to the specified extent, and that the Seller requests settlement in accordance with this Guaranty Declaration. 4.This guaranty is valid until 15-5-2009 and its validity will expire automatically if it is not enforced within this deadline. The Seller is entitled to apply the rights ensuing from the Guaranty Declaration within a deadline no shorter than 15 days prior to its expiry. 5.This Guaranty Declaration is not transferable to third parties. 6.The Seller accepts the Guarantor's declaration to the extent specified above. Prague, March 15, 2007 SdSd guarantorSeller." 5. It is further alleged that as the Purchaser only paid an amount of CZK 14,625,000 out of the total consideration of CZK 230,000,000 petitioner sent letters requesting the Purchaser to pay the unpaid instalments. But as the Purchaser did not make the payment, the petitioner sent a demand notice to the guarantor, namely, the respondent. According to petitioner, it also sent letters dated 30-5-2008 and 14-4-2009 demanding payment of unpaid instalments. 6. Subsequently, the petitioner through their counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or executive and promoter director of Spice Group. He states that Mr. Chilukuri is the group CEO of the respondent Group and further that respondent is one of the companies under the Spice Energy Group. Therefore, according to him, the authority of Mr. Ravi Chilikuri to sign documents cannot be questioned. 13. After having heard the parties, I am of the opinion that the present petition raises no disputed question of fact as not only the respondent has under the Guaranty Declaration dated 15-3-2007 assumed the duty to pay to the petitioner in the event of default by the Purchaser but it has also endorsed four promissory notes issued by the Purchaser for the equivalent amount of purchase price, i.e., CZK 230,000,000. A sample copy of one of the promissory notes is reproduced hereinbelow :- PROMISSORY NOTE Per Aval SRM Exploration Private Limited D-146, Saket, New Delhi - 110 017, India Ravi Chilukuri Sd Prague March 15, 2007 I promise to pay for this promissory note on April 30, 2008 In order to N & S & N Consultants s.r.o. headquartered at Budovatelu, 2830, Most, Czech Republic. The amount of CZK 50,000,000.... In words : fifty million Czech crowns....... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missory notes on behalf of the respondent is, in my opinion, authorized by the board resolution dated 2-3-2007 to sign deeds, documents, agreements and contracts etc. The certified copy of the board resolution is issued under the signature of the director of the Respondent. The Board Resolution dated 2-3-2007, is reproduced hereinbelow :- "Certified true copy of the extract of proceedings of the board meeting held on March 2, 2007 'Resolved that the consent of the Board be and is hereby accorded to Mr. Mohinder Verma and Mr. Ravi Chilukri to sign, verify, execute documents, applications, deeds, agreements, contracts etc. on behalf of the company. Resolved further that the Board hereby ratifies any action already taken by above persons in accordance with the resolution' For S R M Exploration Private Limited Sd Director" 16. In any event, in view of the principle of internal management, respondent cannot take the defence that either Mr. Ravi Chilukuri did not have a power of attorney in his favour or that he was singularly not authorised to execute the Promissory Note or the Guaranty Declaration did not bear the stamp/seal of respondent company. In fact, these defences are clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Delhi) has held as under :- "11. The second contention of Sri Jain is that the provisions of section 433(e) read with section 434(1)(a) of the Companies Act have no application to the present case. He pointed out that the above provisions are attracted only where there is a "debt" owed by the company to a creditor and the contention is that in the present case there was no "debt" owed by the company to the firm. According to him, no such debt could arise until the amount thereof is ascertained and a decree, on the basis of the deed of guarantee, is obtained against the company.......... 12. Applying this test, it is clear that a "debt" from the company to the firm has come into existence in the present case. Under the deed of guarantee, the company has undertaken an obligation to pay to the firm the amounts due to it by the mills. But no "debt" came into existence merely on the execution of the deed of guarantee because it was not a present liability but a contingent liability. The liability of the company to pay did not arise unless, (a) the mills defaulted in making the payments as scheduled, and (b) there was a request/notice calling upon the company to pay the amounts due. Bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no doubt that a debt is owed by the respondent to the petitioner and further the petitioner does not have to wait to obtain a decree from a Civil Court on the basis of the Guaranty Declaration. 24. Recently, the Supreme Court in IBA Health (I) (P.) Ltd. v. INFO-DRIVE Systems SDN BHD [2010] 10 SCC 5531 has held that if there is no dispute as to the company's liability, the solvency of the company would not constitute a stand-alone ground for setting aside a notice under section 434(1)(a ) of the Companies Act, meaning thereby, if a debt is undisputedly owing, then it has to be paid. Consequently, I am of the opinion that respondent owes a debt to the petitioner which it has defaulted in paying. Moreover, the defence set up by respondent is a moonshine and a sham. 25. In view of the aforesaid, the petitioner's application being CA 767/2009 is allowed. The Liquidator attached to this Court is appointed as the Provisional Liquidator of the respondent company. It is further ordered that the respondent company and its directors/officers are restrained from selling, parting with possession or creating third party rights in respect of its movable and immovable properties/assets t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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