M/S Beetal Plantation Pvt Ltd. vs M/S Hotel Queen Road Pvt. Ltd
2012 Latest Caselaw 6436 Del

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*     IN THE HIGH COURT OF DELHI AT NEW DELHI
                                   Date of Decision: 2nd November, 2012
+                        CO.APP.No.88/2012


      M/S BEETAL PLANTATION PVT LTD.                         ..... Petitioner
                         Through:       Mr. Rajesh Aggarwal and
                                        Dr. B.K. Dash, Advocates.

                                   Versus


      M/S HOTEL QUEEN ROAD PVT. LTD                       ..... Respondents

                         Through:       None.

      CORAM:
      HON'BLE THE CHIEF JUSTICE
      HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

RAJIV SAHAI ENDLAW, J

1. This appeal under Section 483 of the Companies Act, 1956 impugns

the order dated 5th September, 2012 of the learned Company Judge of this

Court dismissing in limine and with costs of Rs.25,000/- Company Petition

No.414/2012 filed by the appellant for winding up of the respondent

Company. The learned Company Judge has held the amount in which the

appellant was claiming the respondent Company to be indebted to the

appellant, to be barred by time.

2. The winding up petition was filed averring that the appellant had

given a corporate loan of Rs.1,90,00,000/- to the respondent Company

through eight cheques, between 3rd September, 2007 and 19th November,

2007; that the said loan was for a period of three years and the respondent

Company had agreed to pay interest at the rate of 18% per annum; that the

respondent Company in its ledger account between 1st April, 2004 to 1st

October, 2008 had acknowledged receipt of the aforesaid amount; that the

appellant had vide letters dated 1 st July, 2008 and 10/17th March, 2009

demanded refund of the loan together with interest; that in response thereto,

a meeting was held in the office of the respondent Company where it was

agreed that the said loan of Rs.1,90,00,000/- with agreed interest amount

would be returned by the respondent Company to the appellant after

December, 2010; that the respondent Company had shown to the appellant

its ledger dated 31st March, 2009 where, as on 1st October, 2008, the said

loan was shown; similarly the appellant was shown the ledger of the

respondent Company for the period 1 st April, 2009 to 30th May, 2009; that

the respondent Company had been showing the appellant as one of its

creditors till 31st March, 2011 but had thereafter transferred the said loan

amount to "un-claimed balance". It was thus the plea of the appellant that

loan amount stood admitted by the respondent Company in its books of

account till 31st March, 2011 and hence winding up petition filed in or about

August, 2012 was on the basis of debt suit for recovery whereof was within

the period of limitation.

3. The contention of the counsel for the appellant is that the learned

Company Judge has not considered the aforesaid pleas and has held the

debt to be barred by time merely on the basis of loan having been given in

the year 2007 and the petition for winding having been filed in August,

2012.

4. Undoubtedly the learned Company Judge, in dismissing the winding

up petition, has not taken note of or dealt with the pleas aforesaid, of the

respondent Company having admitted liability in its books of accounts till

31st March, 2011. The counsel for the appellant has also invited our

attention to -

i. Mahabir Cold Storage Vs. Commissioner of Income Tax AIR 1991 SC 1357 holding that entries in the books of account amount to acknowledgment of liability within the meaning of Section 18 of the Limitation Act, 1963 and extend the period of limitation for the discharge of liability as debt;

ii. Hiralal Vs. Badkulal AIR 1953 SC 225 laying down that acknowledgement gives a fresh cause of action and the onus to produce documents is on the party in possession thereof;

iii. The Commissioner of Income Tax Vs. Shri Vardhman Overseas Ltd. MANU/DE/7014/2011 where, in the case of limited company, it was held that the liability shown in the balancesheet amounted to acknowledging the debts within the meaning of Section 18 of the Limitation Act;

iv. Larsen & Tubro Ltd Vs. Commercial Electric Works 67(1997) DLT 387 where also outstanding shown in the balance sheet was held to be an acknowledgement within the meaning of Section 18 of the Limitation Act;

v. Bhajan Singh Samra Vs. M/s Wimpy International Ltd 185 (2011) DLT 428;

vi. Rishi Pal Gupta Vs. S.J. Knitting And Finishing Mills Pvt. Ltd. 73 (1998) DLT 593;

vii. Shri Roshan Lal Goyal Vs. Arti Solvex Limited 2005 (82) DRJ 182;

viii. Rathi Bars Ltd. Vs. Deepak Casting Ltd 137(2007) DLT 491;

ix. Bengal Silk Mills Co. Vs. Ismail Golam Hossain Ariff AIR 1962 Cal 115 (DB);

all to the same effect.

5. There can possibly be no doubt as to the aforesaid proposition.

However we find that the respondent Company in the reply given by it to the

notice preceding the winding up petition had inter alia stated that the

demand in the notice was only to pressurise the new Management of the

respondent Company, at the behest of Mr. R.P. Mittal who

controlled/managed the Company for some time in the past; that the said

Mr. R.P. Mittal had indulged in dishonestly misappropriating the moneys,

creating fictitious liabilities and manipulation of books of account, statutory

records etc., creating fictitious and non-existent liabilities in favour of

various persons including the appellant herein; that the respondent Company

had preferred a suit being CS(OS) No. 161/2012 on the Original Side of this

Court against Mr. R.P. Mittal and his associates, challenging the transactions

and paper entries so created and that the transactions relied upon by the

appellant were nothing but part and parcel of the same conspiracy and

design of Mr. Mittal.

6. We may also mention that a winding up petition filed by some other

person against the respondent Company had also been dismissed and an

appeal being Co.App. No.65/2012 thereagainst had come up before the

Division Bench of this Court of which one of us (Rajiv Sahai Endlaw, J) was

a member and was dismissed. We inquired from the counsel for the

appellant, whether the appellant was aware of the same. It was also inquired

as to whether the various acknowledgements of liability relied upon by the

appellant were of the period when the Management of the respondent

Company was with Mr. R.P. Mittal or any acknowledgement of the new

Management also existed. No clear answer to the said question was

forthcoming. On our coaxing however the counsel for the appellant handed

over copy of the order dated 25th July, 2012 in Company Appeal No.

65/2012 titled Sudershan Dhoop Pvt. Ltd Vs. Hotel Royal Plaza being the

order of the dismissal of appeal aforesaid. We find the position in the

present appeal to be nearly the same as in Company Appeal No. 65/2012,

save that the appellant in that case had already filed a Civil Suit for recovery

of monies which the appellant claims it has not filed as yet. The same

however will not make any difference. We do not find any reason to take a

different view than already taken in the order dated 25th July, 2012. Rather

we are constrained to observe that the counsel for the appellant, admittedly

possessed of the order in the other Company Appeal, ought to have

mentioned the same in the memorandum of appeal and/or shown the same to

us on his own.

7. Faced therewith the counsel for the appellant states that the

observations made by the learned Company Judge while dismissing the

winding up petition may come in the way of a suit for recovery of money to

be filed by the appellant and seeks a clarification as made in the order dated

25th July, 2012 (supra) to the said effect.

8. Accordingly, while dismissing the appeal, we clarify that the

observations of the learned Company Judge that the amount is time barred

would not come in the way of the appellant leading evidence in the suit for

recovery of money to be filed by the appellant and in establishing that the

claim is within the period of limitation.

No costs.

RAJIV SAHAI ENDLAW, J

CHIEF JUSTICE

NOVEMBER 02, 2012 M