Bombay High Court
State Trading Corporation Of ... vs Indo Bonito Multinational Ltd. ... on 13 November, 2017
Bench: R.M. Savant
1 APPL 134-17.doc-23
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
APPEAL (L) NO.134 OF 2017
IN
COMPANY APPLICATION NO.448 OF 2016
IN
COMPANY PETITION NO.276 OF 2011
State Trading Corporation of India Ltd. ]
a company incorporated under the ]
provisions of the Companies Act, 1956, ]
with its office at Jawahar Vyapar Bhavan, ]
Tolstoy Marg, New Delhi - 110 001. ] ... Appellants /
(Orig. Petitioner)
Versus
1. Indo Bonito Multinational Ltd. & Anr. ]
a Company incorporated under the ]
provisions of the Companies Act, 1956, ]
having its office at A-729, TTC Industrial ]
Area, Koparkhairane, Navi Mumbai-400705.] ...Orig. Respondent
2. Shubhra Sudhanshu Datta. ]
(Ex-Director, Indo Bonito Multinational Ltd.)] ... Respondents /
(Orig. Applicant)
Mrs. S. I. Shah i/b S. I. Shah & Co. for Appellant.
Mr. Mayur Khandeparkar a/w Mr. Jamshed Ansari & Mr. Mayur Kadu
for Respondents.
CORAM :- R. M. SAVANT &
SARANG V. KOTWAL, JJ.
DATE :- 13 NOVEMBER, 2017
URS 1 of 15
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JUDGMENT (PER : R. M. SAVANT, J.) :-
1. Admit. Heard forthwith.
2. The above Appeal takes exception to the order dated
22/02/2017 passed by a learned Single Judge of this Court (Coram R.
D. Dhanuka, J.). By the said order, the Company Application No.448
of 2016 filed by the Respondent no.2 herein who is the Ex-Director of
the Respondent no.1, came to be allowed and resultantly, the order
dated 14/11/2014 passed in Company Petition No.276 of 2011 came
to be recalled.
3. It is not necessary to burden this order with unnecessary
details. Suffice it would be to state that an amount of
Rs.112,99,23,300/- was due and payable by the Respondent Company
i.e. the Respondent herein to the Petitioner i.e. the Appellant herein
towards the payment of the outstanding dues of foreign buyers as
stated in the Agreement dated 22/06/2006 and Addendum MOU
dated 07/07/2009 executed by and between the Petitioner and the
and the Respondent Company under the Post Shipment facility availed
of by the Respondent Company through the Petitioner's bankers EXIM
URS 2 of 15
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Bank in the years 2006-07-08-09 for USD 41094627.87 which is
equivalent to Indian Rs.184,92,58,254/-, totally aggregating to
Rs.215,11,40,300/-. The Petitioner accordingly issued a statutory
notice dated 24/12/2010 on the Respondent Company calling upon
the Respondent Company to pay the said amount of
Rs.215,11,40,300/- to the Petitioner within 21 days from the receipt
of the said statutory notice. In view of the fact that the said statutory
notice did not evince any response from the Respondent Company
that the Petitioner filed the instant Company Petition being Company
Petition No.276 of 2011 seeking winding-up of the Respondent
Company. Copy of the said Company Petition was sought to be served
at the address of the Respondent Company appearing in the record of
the Registrar of Companies. However, the packet containing the copy
of the petition was returned with the remark 'shifted'. It seems that
thereafter inquiries were made by the Petitioner with the Registrar of
Companies in August 2011 upon which the Petitioner was furnished
with the registered address of the Respondent Company at Goregaon,
Mumbai. The packet addressed at the said address also returned with
the postal remark as 'unclaimed'. On further inquiries being made in
July 2012, the Registrar of Companies furnished to the Petitioner
URS 3 of 15
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'Company Master Details' of the Respondent Company and in the said
details, the address mentioned of the Respondent Company was an
address in Koparkhairane, Navi Mumbai. The said address would be
referred to in detail in the subsequent part of this order. However, the
packet which was sent at the said address of Koparkhairane, Navi
Mumbai also came back with the remark that the company is 'not
available'
4. The Company Court i.e. the learned Single Judge, by order
dated 30/07/2012, admitted the above Company Petition. The
learned Single Judge has recorded in the said order that the copy of
the petition has been served at the registered office shown in the
records of the Registrar of Companies. The learned Single Judge has
also adverted to the fact that the packet containing copy of the
petition has been returned with the remark 'shifted'. The learned
Single Judge, therefore, observed that the Company is unable to pay
its debts and therefore deserves to be wound-up. The learned Single
Judge accordingly issued the directions as regards the advertisement,
depositing the cost of advertisement etc. in the said order dated
30/07/2012.
URS 4 of 15
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5. The Company Petition thereafter came up for final hearing
before the learned Single Judge on 14/11/2014. The learned Single
Judge adverted to the order of admission dated 30/07/2012 and the
observations made therein in respect of service effected on the
Respondent Company. The learned Single Judge has also adverted to
the fact that the notice under Rule 28 of the Companies (Court) Rules,
1959 which was sought to be served on the Company, returned with
the remark 'left'. The learned Single Judge has also adverted to the
fact that since the notice was sought to be served on the registered
address which on the day was shown in the record of the Registrar of
Companies, the notice is deemed to have been served on the Company
though the packet has come back with the remark 'left'. The learned
Single Judge accordingly made the Company Petition absolute in
terms of prayer clauses (a) and (b) and resultantly directed winding-
up of the Respondent Company under the orders of this Court.
6. The Respondent No.2 herein who is the Ex-Director of the
Respondent No.1 Company thereafter filed the instant Company
Application No.448 of 2016 for condonation of delay of 530 days in
filing the application and for recall of the said order dated
URS 5 of 15
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14/11/2014 passed by the learned Single Judge directing winding-up
of the Respondent Company. In justification of the delay, it was
stated that the Applicant became aware of the order passed on
14/11/2014 on 27/04/2016 and that the instant Company
Application was filed on 06/05/2016. The foundation for the said
Application can be said to be the fact that the Applicant had not
received the notice of the above Company Petition as the same was
not served on its registered address at Koparkhairane, Navi Mumbai.
It seems that no reply was filed to the said Company Application. A
learned Single Judge of this Court (R. D. Dhanuka, J.) considered the
said Application and by the impugned order dated 22/02/2017,
allowed the said Application and whilst allowing the said Application,
condoned the delay of about 530 days in filing the Application. The
learned Single Judge has adverted to the mandate of Rule 28 of the
Companies (Court) Rules, 1959 which requires that the Company
Petition was required to be served on the registered address of the
Respondent. The learned Single Judge has adverted to the Division
Bench Judgment of this Court in the case of MODERN DEKOR
PAINTING CONTRACTS PVT. LTD. VS. JENSON & NICHOLSON
URS 6 of 15
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(India) LTD. and another1 which Judgment is an exposition of the
Division Bench as regards the said Rule 28 and the Judgment of the
learned Single Judge of this Court in SKOL BREWERIES LTD. VS.
SANMAN DISTRIBUTORS PVT. LTD.2 in which Judgment, the
Judgment of the Division Bench has been referred to and relied upon.
The learned Single Judge, therefore, deemed it appropriate to allow
the Application thereby setting aside the order dated 14/11/2014
passed in the above Company Petition and issued the directions which
are contained in the operative part which would facilitate the de novo
hearing of the Company Petition by recording the statement made by
the learned Counsel for the Respondent that he waives notice under
Rule 28 of the Companies (Court) Rules, 1959. As indicated above, it
is the said order dated 22/02/2017 which is taken exception to by
way of the above Appeal.
7. Heard the learned Counsel for the parties.
8. The learned Counsel for the Appellant i.e. the Petitioner
Mrs. S. I. Shah would contend that the Petitioner had sought to serve
the Company Petition at all the three addresses i.e. the Santacruz
1 1983 Mh.L.J. 485
2 AIR 1999 Bombay 249
URS 7 of 15
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address, Goregaon address and the Koparkhairane, Navi Mumbai
address. However at all the three address, the packets came back with
remarks as 'shifted', 'unclaimed' and 'not available'. It was the
submission of the learned Counsel that having regard to the said fact
of the packets not being claimed on behalf of the Respondent
Company, there was no necessity for the Petitioner to amend the
cause-title so as to correct the address mentioned of the Respondent
Company in the cause-title so as to incorporate the Koparkhairane,
Navi Mumbai address. It was also the submission of the learned
Counsel that Rule 28 (2) also provides that the Company Petition can
be served as the last known address of the Company in question of
whose winding-up is sought. The learned Counsel would seek to
place reliance on the order directing the winding-up as according to
her, in the said order, the learned Single Judge who passed the final
order of winding-up in the Company Petition, has taken cognizance of
the fact that the notice was sought to be served at the registered
address which was in the record of the Registrar of Companies. It
was, therefore, the submission of the learned Counsel that the learned
Single Judge has erred in recalling the order passed in the Company
Petition.
URS 8 of 15
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9. Per Contra, the learned Counsel for the Respondents Mr.
Mayur Khandeparkar supported the impugned order. The learned
Counsel would contend that the attempt of the Petitioner to serve the
Respondent Company at the pre-admission stage at Koparkhairane,
Navi Mumbai address is of no avail in view of the fact that service of
the Company Petition after its admission is also required to be effected
at the registered address of the Company which, in the instant case, is
Koparkhairane, Navi Mumbai. In support of the said contention, the
learned Counsel would seek to rely on the Judgment of the Division
Bench in the case of MODERN DEKOR (supra) and the learned Single
Judge in SKOL BREWERIES LTD (supra). It was the submission of the
learned Counsel that a clear distinction has been made between the
service effected prior to the admission of the petition and post the
admission of the petition insofar as compliance of Rule 28 of the
Companies (Court) Rules, 1959 is concerned. It was, therefore, the
submission of the learned Counsel that no interference is called for
with the impugned order passed by the learned Single Judge.
10. Having heard the learned Counsel for parties, we have
given our anxious consideration to the rival contentions. The issue
URS 9 of 15
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that arises is whether the order dated 14/11/2014 directing the
winding-up of the Respondent Company was required to be recalled
as has been done by the learned Single Judge by the impugned order.
In the said context, it would be apposite to refer to Rule 28 of the
Company (Court) Rules, 1959 which, for the sake of ready reference,
is reproduced hereunder :
"R.28. Service on company - (1) Where a petition is
presented against a company, it shall be accompanied
by a notice of the petition in the prescribed form
together with a copy of the petition for service on the
company and an envelope addressed to the company
at its registered office or its principal place of business
and sufficiently stamped for being sent by registered
post for acknowledgment. The Registrar shall
immediately on the admission of the petition send the
notice together with the copy of the petition to the
company by registered post.
(2) Every petition and, save as otherwise provided
by these rules or by an order of Court, every
application, shall unless presented by the company, be
served on the company at its registered office, or if
there is no registered office, at its principal or last
known principal place of business, by leaving a copy
thereof with an officer or employee of the company,
and in case no such person is available, in such
manner, as the Judge or Registrar may direct, or, by
sending a copy thereof by prepaid registered post
addressed to the company at its registered office, or, if
there is no registered office, at its principal or last
known principal place of business, or to such person
and at such address as the Judge or Registrar may
direct.
URS 10 of 15
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Where the company is being wound-up the
petition or application shall also be served on the
liquidator, if any, appointed for the purpose of
winding-up the affairs of the company."
A reading of the said rule, therefore, makes it clear that the
requirement is that a copy of the Company Petition along with notice
in the prescribed form is to be lodged with the Company Department
of this Court for facilitating the service to be effected on the Company
of which winding-up is sought. At this stage, it is required to be noted
that on behalf of the Petitioner as many as three affidavits of service
have been filed. However, the said affidavits of service are pre-dating
the admission of the Company Petition. The said affidavits disclose
the three addresses at which the notice prior to the admission of the
Company Petition was sought to be served on the Respondent
Company. The said three addresses are as follows :
(1) Office No.10, 2nd Floor, Dheeraj Heritage, S. V.
Road, Milan Subway (Junction), Santacruz (W),
Mumbai - 400 054.
(2) 1011, B-Wing, 11th Floor, I. J. Mima Complex,
Link Road, Behind Goregaon Sports Club, Malad
(W), Mumbai, Maharashtra.
(3) A-729, TTC Industrial Area, Koparkhairane, Navi
Mumbai.
URS 11 of 15
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Insofar as the third address is concerned, the said address has been
furnished to the Petitioner after a search was taken by the Petitioner
in the office of the Registrar of Companies. The said address forms
part of the 'Company Master Details' of the Respondent Company. In
the extract furnished by the office of the Registrar of Companies, the
address mentioned is the aforesaid third address namely
Koparkhairane, Navi Mumbai. It is required to be noted that the pre-
admission notice was sought to be served at the said address.
However, the packet came with remark as 'not available at the said
address'. As indicated above, the Company Petition came to be
admitted on 30/07/2012 and in terms of Rule 28, it was required on
the part of the Petitioner that the notice be once again served on the
Respondent at the said address i.e. Koparkhairane, Navi Mumbai.
Admittedly, this has not been done.
11. Now coming to the Judgment of the Division Bench, the
Division Bench in the case of MODERN DEKOR (supra), has held that
the service of the notice under Rule 28 is mandatory. The Division
Bench has further held that after the admission of the petition, a
notice has to be served upon the Company and this is made amply
URS 12 of 15
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clear by Sub-Rule (1) of Rule 28 which states that the Registrar shall
immediately on the admission of the petition send the notice together
with the copy of the petition to the Company by registered post. The
Division Bench has in terms held that a letter intimating the date fixed
for the admission of the petition given to the Company is an
altogether different aspect of the matter. The Division Bench also did
not countenance the submission urged in the said case that the
advertisement published in the newspapers should be taken as service
upon the Company.
12. As indicated above, the said Judgment of the Division
Bench has been followed by the learned Single Judge in SKOL
BREWERIES LTD (supra) wherein the learned Single Judge has held
that Rule 28 is mandatorily required to be followed and complied with
after the admission of the Company Petition by issuance of notice to
be sent along with the Company Petition to the Company by
registered post.
13. In the light of the exposition of the Division Bench
followed by the learned Single Judge, it is not possible to accept the
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contention urged on behalf of the Petitioner that since the packet
which was sought to be served on the Respondent Company at the
Koparkhairane, Navi Mumbai address had returned with the remark
that the Company was not available at the said address, the Petitioner
was not required to amend the cause-title so as to incorporate the said
Koparkhairane, Navi Mumbai address in the cause-title. In our view,
in a matter as serious as a Company Petition which seeks direction for
winding-up of a Company which obviously has a serious consequence
for the Company, the procedure cannot be short-circuited as in the
matter sought to be contended by the learned Counsel for the
Petitioner i.e. the Appellant herein. Since the Koparkhairane, Navi
Mumbai address was the address appearing in the 'Company Master
Details' of the Registrar of Companies, the Appellant was required to
take steps to serve the notice post the admission of the petition at the
said address. It is also not possible to accept the contention of the
learned Counsel for the Petitioner that Rule 28 (2) provides for service
to be effected at the last known address. The said provision would
apply only if there is no registered address of the company. In our
view, therefore, there is no merit in the above Appeal. The order
passed by the learned Single Judge, in the facts and circumstances of
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the case, condoning the delay whilst setting aside / recalling the order
dated 14/11/2014, cannot be found fault with. The Appeal is
accordingly dismissed.
(SARANG V. KOTWAL, J.) (R. M. SAVANT, J.)
URS 15 of 15
