TMI Blog1993 (9) TMI 360X X X X Extracts X X X X X X X X Extracts X X X X ..... ct was awarded to the petitioner. On acceptance of the offer, the company paid an advance ofRs.50,000.00 to the petitioner. The petitioner executed the work and submitted the invoices from time to time. On completion of the contract, the petitioner submitted its final bill/invoice for ₹ 89,804.66 p., balance as against the total bill of ₹ 1,79,804.76 p. the company cleared the bill to the extent of ₹ 1,78,764.75 p.there by leaving a principal sum of ₹ 88,764.75 p. due. This outstanding due is payable by the company. The company infact confirmed the credit balance. The company also issued Form 'C' in respect of the material supplied by the petitioner. The petitioner had been calling upon the company to clear t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e limitation. It is apparent that after 31st March, 1990 no account continued nor any transaction took place. Hence the period of limitation has to be counted from 31st March, 1990. (4) I have heard the learned counsel for the parties and perused the record. Perusal of the record shows that the petitioner issued letter on I st September, 1990 filed on record as Annexure 'A' asking the respondent to confirm the balance as on 31st March, 1990. This letter was received by the company on 6th September, 1990. So naturally the confirmation which was signed by the Accounts Officer/Authorised officer of the respondent company on the said letter could not have been earlier than 6th September, 1990. Hence the presumption is that either it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere exist present subsisting liability which respondent company has failed to discharge. To strengthen my view, I am supported by the decision of the Andhra Pradesh High' Court in the case of Shree Vijaya Kumar Machinery. and Electrical Stores vs. Alaparthi Lakshmikanthamma reported in (1968)II Andhra Weekly Report page 567. While interpreting the word acknowledgement of debt it was held that the acknowledgement of debt must relate to a present subsisting liability. The date of signing the balance sheet by the respondent started a fresh period of limitation. The facts of that case were that a suit was filed on the basis of two promissory notes. Original promissory notes were not produced in court but the plaintiff relied on a copy of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... defense. This clearly shows that the respondent has no capacity to pay the amount- even after the, statutory notice. The company is financially insolvent. The only defense which was raised has been negatived. The liability being admitted and the respondent company being not in a position to discharge the same, I have prima facie come to the conclusion that the respondent company is financially insolvent and accordingly direct the petition to be admitted to hearing. Let citation be published in the newspapers Statesmen (English Edition), Navbharat Times (Hindi Edition) and Delhi Gazette. However, if the respondent company pays the debt within two months from today, till then the citation may not be published. - - TaxTMI - TMITax - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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