1992 (10) TMI 222 - HC - Companies Law

Winding-up petition admitted against Ananya Electroniks Ltd. for debt non-payment

Sharda Bhandari Versus Ananya Electroniks Ltd.

The court admitted the winding-up petition against Ananya Electroniks Ltd. due to its inability to pay debts, appointing a provisional liquidator and ... Company when deemed unable to pay its debts Issues Involved:1. Claim for winding up of the company due to inability to pay debts.2. Non-payment of rent and other charges by the company.3. Dispute over liability to pay enhanced rent and other taxes.4. Adjustment of payments made to the Municipal Corporation.5. Pendency of standard rent fixation petition and its impact on rent payment obligations.6. Appointment of provisional liquidator.Issue-wise Detailed Analysis:1. Claim for Winding Up of the Company Due to Inability to Pay Debts:The petitioner, a widow, sought the winding up of Ananya Electroniks Ltd. on the grounds that the company was unable to pay its debts. The petitioner had previously let out her factory premises to the company after her husband's death, who had built the premises for starting a factory. Despite initial payment of two months' rent in advance, the company failed to make subsequent rent payments, leading to arrears and the filing of the winding-up petition.2. Non-payment of Rent and Other Charges by the Company:The petitioner claimed that the company owed her Rs. 4,69,566.22, including arrears of rent, enhanced rent, property tax, water tax, and scavenging tax. The company did not dispute the receipt of the notice of demand but claimed that negotiations for an amicable settlement were ongoing. The company also admitted to making payments to the Municipal Corporation of Delhi due to an order of attachment but did not make any direct rent payments to the petitioner.3. Dispute Over Liability to Pay Enhanced Rent and Other Taxes:The company disputed its liability to pay enhanced rent and other taxes, arguing that the rent had been attached by the Municipal Corporation and payments were made accordingly. The company also claimed entitlement to adjust payments made to the Corporation and the security deposit against the rent due. The petitioner, however, maintained that the company was liable to pay rent at the enhanced rate and other charges as per the agreement.4. Adjustment of Payments Made to the Municipal Corporation:The petitioner acknowledged the company's claim for adjustment of payments made to the Municipal Corporation but argued that even after such adjustments, significant amounts were still due. The petitioner provided detailed calculations of the amounts due, including rent, taxes, and interest, totaling Rs. 8,95,465.96, and after adjustments, claimed that over Rs. 4,50,000 was still owed by the company.5. Pendency of Standard Rent Fixation Petition and Its Impact on Rent Payment Obligations:The company argued that it was not liable to pay the agreed rent from March 1, 1990, due to the pendency of a petition for fixation of standard rent. The petitioner countered that the company could not dispute its liability to pay rent based on the pending petition and that there was no bona fide dispute. The court noted that the company had not provided details on the status of the standard rent proceedings and concluded that the company's refusal to pay the contractual rent did not demonstrate a bona fide dispute.6. Appointment of Provisional Liquidator:Given the company's failure to make rent payments and the lack of a bona fide dispute, the court admitted the winding-up petition and ordered the publication of the citation. The official liquidator attached to the court was appointed as the provisional liquidator to take over the company's assets and records. The court provided the company an opportunity to avoid the winding-up order by paying Rs. 1,39,248.40 to the petitioner by a specified date, failing which the order would become operative.Conclusion:The court found that the company was commercially insolvent and had neglected to pay its debts to the petitioner. The winding-up petition was admitted, and the provisional liquidator was appointed, with the order becoming operative if the company failed to make the required payment by the stipulated date.