In Re: L And T Finance Ltd. vs Unknown
2004 Latest Caselaw 552 Bom

ORDER

Anoop V. Mohta, J.

1. The present company petition has been filed by the petitioner-company L & T Finance Limited, having its registered office at L & T House, Ballard Estate, Mumbai and thereby invoked the provisions of Sections 433 and 434 of the Companies Act, 1956 (for short 'Companies Act') and thereby prayed to wind up the respondent-company, namely Ganesh Benzoplast Ltd., having its registered office at Ganesh House, off. Andheri-Kurla Road, Marol Naka Andheri (East), Mumbai. That the respondent-company some time on 8th May, 2000, approached the petitioners and requested for finance and accordingly, the petitioner-company had agreed and agreement dated 8th May, 2000, was entered between the parties. The respondent-company defaulted and made late payment of the instalments, in spite of the said agreement. On 6th May, 2000, prior to the execution of the loan agreement, the respondent had undertaken to make the payment, within the time period specified in the schedule contended in the loan agreement. On 11th June, 2002, pursuant to the request of the respondent-company, a one-time settlement was agreed on the condition mentioned in the letter dated 11th June, 2002. The respondent-company committed default again and failed and neglected to comply with the conditions contended in the said letter. Therefore, the said agreement for one-time settlement was cancelled and demand was made to the respondent-company, to make the payment of outstanding dues, in terms of loan agreement dated 8th May, 2000. As there was no payment made by the statutory notice, dated 4/3rd August, 2002, demanded the amount of Rs. 55,43,233 with further interest thereon at the rate of 26 per cent from 1st August, 2002. The said notice was duly received by the respondent-company. There was no payment made within the stipulated period of statutory notice.

2. The petitioner-company therefore, have filed company petition No. 1025/2002 and in the above background, submitted that the assets of the said company are not sufficient to meet their liabilities, which are admittedly, not paid in spite of demand. As per the latest Annual Return ie. on 29-9-2001, the respondent-company is indebtedness towards other creditors and there are various winding up petitions, which are pending against the said company. Therefore, it is just, fair, and absolutely necessary to wind up the petition and appoint official liquidator, as prayed.

3. An affidavit in reply, dated 27th December, 2002 was filed on record by the respondent and resisted the claim and objected to the liability also. To this rejoinder dated 27th July, 2003, has been filed by the petitioner-company. The respondents-company have also filed sur-rejoinder, dated 22nd August, 2003. To this petitioner-company has filed sur-rejoinder dated 18th November, 2003. In all, parties have reiterated their respective stands.

4. After considering the arguments raised and submitted by the parties, there is no doubt that the respondent-company has failed to make the payment, in spite of statutory notice and those liabilities are still pending. The defence raised by the respondent-company is not bona fide and genuine, and cannot be sufficient to dismiss the present petition, as prayed.

5. There is admittedly, no reply filed, sent or issued by the respondent-company to the statutory notice dated 3rd August, 2002. There is basically no denial to the averments made in the said statutory notice. It appears that there is no dispute, so far as, the amount referred in the said demand. On these admitted facts itself, there is material to show that the respondent-company 'neglected to make the payment', in spite of the statutory demand, within statutory period. The fact that there are various company petitions, which are pending against the respondent-company further justifying the order of winding up in this petition also.

6. The respondent-company admittedly, therefore, has no capacity to make the payment and is insolvent or at least not in a position to fulfil objections and demand made by the petitioners-company, therefore, entitled in the facts and circumstances of the case and the orders, as played on is just, fair and equitable grounds as contemplated under Sections 433 and 434 of the Company Act.

7. The conduct of the respondent shows on the basis of affidavit filed on record, that one way or the other they are denying or resisting the demand made by the petitioner-company, from time-to-time. Even one time settlement terms and conditions could not be fulfilled and/or deliberately not complied with or unable to be complied with. All this background further justify that respondent has no bona fide, and at any point of time or till today any intention to make the payment or its dues, as prayed and demanded by the petitioner-company.

8. In view of the affidavit, filed by the parties, the defence raised by the respondent-company is not bona fide and genuine and is raised only to postpone the payment and/or winding up order. In spite of their affidavit respondent-company failed to furnish the requisite material and the documents. The combined loan outstanding against the respondent-company is of more than 200 crores. In view of this, the defence, as raised by the respondent-company cannot be accepted. One cannot overlook the cheques Exh. "C" filed along with the affidavit and rejoinder, dated 24th July, 2003, filed by the petitioner. Therefore, the defence of the respondent-company, that after adjusting the amount, the respondent-company is entitled to receive some money from the petitioner-company is not bona fide or in good faith. All these averments have no foundation or supporting documents. Therefore, the case that no amount remains, as due and payable by the respondent to the petitioner is not correct and bona fide. The further defence of respondent-company about their sound financial position, as referred in their affidavit, dated 27th December, 2002, that itself cannot be the reason not to make the payments and release the company's liability as demanded by the petitioner-company. It cannot be accepted that the network of the company is Rs. 2.48 crores, that the company is in sound position. It also cannot be accepted that the company has reserved Rs. 242 crores, as shown in the balance-sheet for the year ended 31st March, 2000. The respondents-company has itself, admitted that the company have suffered losses in the current year, and there are various suits for recovery for approximately Rs. 30 to 35 crores, which are pending, including criminal proceedings under Section 138 of Negotiable Instruments Act, for recovery of their company's amount. This cannot be the reason to dismiss the present petition, even though averment is made that the company is a running concern and not liable to be wind up. Considering, the case made out by the petitioner in the petition, as well as, in its respective rejoinder and sur-rejoinders and as admittedly, the outstanding amount as on 31st July, 2003, is about Rs. 55,42,282, this is a fit case where the petition should be admitted and advertised.

9. However, if the respondent-company wants to make the payment of the amount due and as demanded by the petitioner-company, they are permitted to deposit the same within three months from the receipt of the copy of this order and/or settle the dispute with the party, within same time.

10. Failing which the following order will come into force forthwith.

11. The petition is admitted. Returnable after three months.