TMI Blog2015 (3) TMI 196X X X X Extracts X X X X X X X X Extracts X X X X ..... had also raised debit notes on that account. Therefore, the dispute existed even before issuance of the statutory notice under Section 434(1)(a) of the Act and filing of the present petitions. The respondent by its similar replies dated 20.03.2012, 30.03.2012 and 30.04.2012 replied to various notices issued by the petitioner under Section 138 of the NI Act. Although, there appears to be some disputes with regard to the quality of goods, however, substantial parts of the amount claimed by the petitioner is undisputedly payable by the respondent. And, the respondent not only tendered the amount as admitted by it but also tendered the amount disputed by the respondent for which debit notes were issued. This itself indicates that the respondent company is able to pay its debts and could not be considered as commercially insolvent. In view of the above, I am unable to accept that the respondent company is unable to pay its debts and is liable to be wound up by virtue of Section 433(e) of the Act. - Winding up application dismissed. - CO. PETITION NOS. 373 & 375 OF 2012 C.A. NOS.1485 & 1492 OF 2012 - - - Dated:- 5-5-2014 - VIBHU BAKHRU, J. Vivek Singh for the Petitioner. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent is liable to pay interest at the rate of 4% per month on the delayed payment. It is submitted that the said rate of interest has been agreed and specifically mentioned in the invoices raised by the petitioner. It is stated that the late payment charges are not claimed as penalty but as pre-determined assessment of loss suffered by the supplier petitioner on account of any delay in the payment. Therefore, the petitioner has claimed and is entitled for an amount of ₹ 1,66,19,726/- as late payment charges till 31.1.2012. 3.2 It is stated that the respondent issued various cheques for an amount aggregating to ₹ 97,56,145/- in discharge of its liabilities, however, the said cheques were dishonoured. The petitioner, by separate notices dated 27.02.2012 under section 138 of the NI Act, demanded amounts of ₹ 20,08,692/-, ₹ 27,47,607/-, ₹ 28,45,540/- and ₹ 21,54,306/- on account of the dishonour of the cheques for the respective amounts. The respondent replied to the said notices, by its separate replies dated 20.03.2012 and raised the issue of inferior quality of goods being supplied by the petitioner and non-adjustment of debit notes for an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest has been agreed and specifically mentioned in the invoices raised by the petitioner. It is stated that the late payment charges are not claimed as penalty but as pre-determined assessment of loss suffered by the supplier petitioner on account of any delay in the payment. Therefore, the petitioner has claimed and is entitled for an amount of ₹ 43,14,976/- as late payment charges. 4.2 It is stated that the respondent issued various cheques for an amount aggregating to ₹ 81,46,886/- in discharge of its liabilities, however, the said cheques were dishonoured. The petitioner, by separate notices dated 03.03.2012 and 14.03.2012 issued under section 138 of the NI Act demanded amounts of ₹ 27,27,571/-, ₹ 16,97,060/- and ₹ 37,39,930/- on account of the dishonour of the cheques for the respective amounts. It is stated that the respondent failed to pay the said amounts within the time specified in the notices, therefore, the petitioner initiated proceedings under section 138 of NI Act and filed Criminal Complaint No.205/1 (with respect to the notice for ₹ 27,27,571/-), Complaint No.206/1 (with respect to the notice for ₹ 16,97,060/-) and Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent stated that although, there are bona fide disputes with respect to the goods supplied by the petitioner and the debit notes issued by the respondent have not been accounted for by the petitioner, the respondent was ready and willing to tender the amount of ₹ 1,79,00,000/- being the amount for which cheques had been issued by the respondent to the petitioners. It was also suggested that the petitioners could initiate a civil action for recovery of any further sum that the petitioners felt were due and payable by the respondent. However, as said payment was being tendered in lieu of dishonored cheques the proceedings under Negotiable Instruments Act would not proceed. This suggestion was not acceptable to the petitioner and the petitioner insisted that the respondent would also have to pay the late payment charges if the proceedings under the Negotiable Instruments Act were to be compromised. 8. It was contended by the learned counsel for the respondent that the present petitions were not maintainable as the amounts claimed by the petitioners were disputed. It is contended that the amounts claimed by the petitioners included additional bills that had not been accepted. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as raised a claim for an amount of ₹ 1,03,18,917/- and in Co. Pet. No.375/2012, the petitioner has claimed an amount of ₹ 1,18,11,927/- towards the supplies made to the respondent. The respondent, however, disputes the claim of the petitioners on the ground that the petitioners supplied inferior quality material due to which the respondent alleged that it had suffered huge losses which the petitioners were liable to make good. It is pertinent to note that the dispute with regard to inferior quality of the goods supplied by the petitioner was raised by the respondent in its reply to the notice issued under Section 138 of the NI Act and the respondent had also raised debit notes on that account. Therefore, the dispute existed even before issuance of the statutory notice under Section 434(1)(a) of the Act and filing of the present petitions. The respondent by its similar replies dated 20.03.2012, 30.03.2012 and 30.04.2012 replied to various notices issued by the petitioner under Section 138 of the NI Act and the relevant extract of the reply dated 20.03.2012 is extracted hereinbelow:- That your clients representative also ensured my client to be supplied with the good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent. Therefore, the amount towards the late payment charges was due and payable by the respondent. On the other hand, the respondent has contended that the respondent used to strike out the said clause on the copies of the bills which were acknowledged by it, therefore, there was no agreed rate of interest. It was further contended that the delayed payment charges are in the nature of penalty which cannot be the subject matter of the present proceedings. The respondent in its replies dated 20.03.2012, 30.03.2012 and 30.04.2012 to various notices issued by the petitioner under Section 138 of the NI Act also disputed the amount claimed towards the late payment charges. In view of the above, there exists a bona fide dispute with regard to the amount towards the late payment charges and the same cannot be said to be due and payable by the respondent company. 16. Further, it is a settled principle that mere mentioning a stipulation with regard to delayed payment interest in a bill or invoice would not per se constitute an agreement for payment of interest. The Rajasthan High Court in the case of Kitply Industries Ltd. v. Hari Narain Sons (P.) Ltd. [1998] 91 Comp Cas 715, has held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e payment charges, First of all, the petitioner would have to establish that there was an agreement between the parties that such charges would be paid. The respondent has stated that the clause for delayed payment charges was never agreed upon and had been deleted by the respondent in the invoices acknowledged by it. The petitioner has disputed the same and has stated that there were no invoices available with the petitioner which had been acknowledged by the respondent. This clearly is a substantial dispute that would require to be adjudicated. Secondly, the delayed payment charges claimed by the petitioners are in the nature of damages and the petitioners would have to establish that the same reflects reasonable damages suffered by the petitioners. Prima facie, charges at the rate of 4% per month (i.e. 48% per annum) seem unconscionable. The respondent has not admitted that the same are payable and the omission on the part of the respondent to pay the same cannot be inferred as indicating that the respondent is unable to pay its debts. 18. The respondent has also disputed certain specified bills and the petitioner would have to establish that the goods of the requisite descri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty to unreasonably set the law in motion, especially when the aggrieved party has a remedy elsewhere. 20. In view of the above, I am unable to accept that the respondent company is unable to pay its debts and is liable to be wound up by virtue of Section 433(e) of the Act. 21. Before concluding, I must add that it appears that the present proceedings had been initiated by the petitioners to pressurize the respondent. After filing of the present proceedings, the respondent had tendered the amount of cheques to the petitioners, in proceeding under the NI Act, before the Metropolitan Magistrate. However, the petitioner had refused to accept the same. Accordingly, by an order dated 31.08.2012, the Metropolitan Magistrate rejected the said applications filed by the respondent as the petitioner had refused to accept the amount offered by the respondent. The relevant portion of the said order dated 31.08.2012 is extracted hereinbelow:- In view of totality of circumstances, after going through the record and hearing the submissions of both parties, this application for paying the cheque amount is also rejected as the complainant has submitted that the cost of compounding shall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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