1986 (5) TMI 206 - HC - Companies Law

Improper affidavit leads to denial of winding-up petition appeal. Emphasis on affidavit compliance.

Mool Chand Wahi Versus National Paints (P.) Ltd.

Mool Chand Wahi Versus National Paints (P.) Ltd. - [1986] 60 COMP. CAS. 198 (PUNJ. & HAR.) Issues:The judgment involves the dismissal of a petition for winding up of a company under sections 433, 434, and 439 of the Companies Act, 1956 due to improper verification of the accompanying affidavit.Judgment Details:The petition for winding up of the company was dismissed by the learned single judge on the basis that it lacked a proper affidavit accompanying it. The appellant filed a company appeal under section 483 of the Act against this decision. The affidavit submitted with the petition was found to be not in proper form, as it did not specify which paragraphs were true to the deponent's knowledge and which were based on belief. The Rules governing such petitions require proper verification through an affidavit filed along with the petition, as per Rule 21 and Form No. 3. It was acknowledged that a petition for winding up not supported by a proper affidavit is liable to be dismissed.The appellant argued that the verification of the affidavit was a matter of form and requested to file a fresh affidavit, citing a precedent. However, the court found no merit in this argument. The judgment emphasized that an affidavit supporting a company petition is considered substantive evidence, and without a proper affidavit, the petition holds no legal standing. Allowing an amendment at a later stage would create confusion and affect the rights of third parties. A previous case cited by the appellant was distinguished as it dealt with a different context where the affidavit was not intended as evidence.No further valid arguments were presented, leading to the dismissal of the appeal with each party bearing their own costs. The second judge concurred with this decision.