TMI Blog2015 (6) TMI 331X X X X Extracts X X X X X X X X Extracts X X X X ..... up only to stall the process of winding up. - Decided against the appellant. - A.P.O. No. 235 of 2014, A.P.O. No. 236 of 2014, C.P. 349 of 2013 - - - Dated:- 23-4-2015 - Ashim Kumar Banerjee And Shivakant Prasad, JJ. For The Appellant : Mr. Sakya Sen, Senior Advocate, Mr. Aniruddha Mitra, Advocate and Mr. Rohit Mukherjee, Advocate For The Respondent : Mr. Sailendra Jain, Senior Advocate and Mr. S.N. Pandey, Advocate ASHIM KUMAR BANERJEE, J. BACKDROP: Nampa Electricals Private Limited (hereinafter referred to as the said Company) engaged New Haryana Transport Company to act as their transporter. They were supposed to transport goods from various places on behalf of the company to the destination according to the instruction given by the company. Haryana Transport would claim, their four bills remained outstanding amounting to ₹ 24,000, 11,000, 18,500 and 35,000 respectively aggregating to ₹ 88,500. The Company initially asked the transporter to raise the fourth bill on the consignee Radha Strips Private Limited. They did so however, they were subsequently told; Nampa would pay the said bill, despite reminders the bills were not paid. Transpor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l. While doing so, the Division Bench observed, the order of admission was passed considering the rival contentions hence; there could be no scope for making any application for recall. The document sought to be placed on record were already in control and custody of the Company and could have been annexed in the affidavit. The Division Bench however, observed at the last, it is however, well-settled that the observations made in the proceedings which were basically inter-locutary do not determine the final result of the proceeding . The matter appeared before the learned Judge again at the post advertisement stage. His Lordship directed affidavits to be exchanged. The learned Judge ultimately passed an order of winding up. From the order of winding up we find, the Company expressed its desire to secure the claim as according to them payments had already been made in full. The learned Judge observed, the defence was not taken in the affidavit-in-opposition at the admission stage. Their application for recall was dismissed. The Division Bench also dismissed the appeal. There was no change to the order of admission hence; such plea could not be accepted. The above two appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may not be relevant here as the record shows; the company was in involved circumstances due to its precarious financial condition. In our view, His Lordship should have admitted the winding up petition and directed advertisement of notice making the said proceeding a representative action. Emphasis was placed on the advertisement of notice of demand. The petitioning creditor claimed, they did not receive back the acknowledgement due card. It would have been proper, if the appellant would enquire from the postal authorities about the fate of such undelivered packet, or the acknowledgement due card. They took no step in this regard. However, this ground alone would not be sufficient to deny admission of petition. This irregularity could not be presumed as mala fide as erroneously held by his Lordship. If we go by His Lordship s views per se on section 434 (1) (a) we might agree with the ultimate result. However, the right of a creditor, secured or unsecured, to maintain the winding up petition would lie both under section 434 (1) (a) as well as 433 (e) and (f). Mr. Mookherjee contended, it was not argued. The learned judge however mentioned about the other aspect particularly t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o wait till the priority creditors are paid off and a rest and residue would become available for his payment. In a civil suit this long drawn complex process would not be there, a creditor can simply sue its debtor even if it is a Company and on final adjudication, he would get a decree from Court that he would be entitled to put to execution. Such simple process would help him to recover the dues. The process of adjudication in a civil suit and a winding up proceeding would be totally different from each other. As observed hereinbefore, the creditor would be entitled to file a winding up proceeding based on the presumption of insolvency in case his notice is not attended to, in the manner prescribed in law. However, such presumption is not the last word, the Company would still be entitled to rebut such presumption contesting the proceeding and such rebuttal could only be done by raising a bona fide dispute. Once a dispute is raised, the Court adjudicates on the dispute and such adjudication may not have to go through the strict process of proof in accordance with the provisions of the Evidence Act. Once such adjudication is made and such adjudication goes against the Company, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The judgment was carried in appeal. The Division Bench in the case of SRC Steel Limited (supra), upset the said decision and held, such adjudication was conclusive. I frankly admit, I have become wiser after going through the reasoning given in the Division Bench decision in the case of SRC Steel Limited (supra). The Karnataka decision in the case of Air Wings (supra) would hold otherwise, it observed, but after advertisement even after creditors can show or even the Company itself can show at the stage of trial that despite the prima facie finding which has resulted in admission and advertisement of the petition, there is no case for winding up. Such observation was made in a different context. If we read the judgment as a whole we would find, the question arose at what stage the enquiry on merits would be done. The Division Bench observed, a pre-admission hearing was the need of the hour. While deciding the procedural aspect, the Division Bench also prescribed the scope of enquiry and while doing so the Division Bench observed so as referred to above. Our High Court has been doing so for a pretty long time and may be the pioneer in the field of setting the procedure for a windin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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