Court dismisses no interest payment defense on Inter-Corporate Deposit, orders Rs. 40 lakh deposit pending recovery suit

The court rejected the respondent's defense of no interest payment on an Inter-Corporate Deposit, finding it not genuine based on subsequent actions. The authenticity of disputed documents was upheld, and the court directed the respondent to deposit Rs. 40 lakhs pending a recovery suit filing by the petitioner. Failure to comply would lead to the admission of the winding-up petition. The judgment balanced fairness and legal procedures, ensuring resolution of the repayment and interest dispute while upholding parties' rights.

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Issues:
Inter-Corporate Deposit repayment and interest dispute, Authenticity of documents, Defense of no interest payment, Validity of winding-up petition.

Inter-Corporate Deposit repayment and interest dispute:
The petitioner disbursed an Inter-Corporate Loan of Rs. 2 crores to the respondent with an interest rate of 28% per annum. The principal amount was repaid, but the respondent claimed interest of Rs. 83,81,955. The respondent argued that no interest was specified, citing a compensation measure for high lease finance rates. However, subsequent communications and actions indicated otherwise, showing the interest dispute was not genuine.

Authenticity of documents:
The respondent disputed the authenticity of a crucial letter setting out the terms of the deposit. The petitioner denied the fabrication claims, providing evidence to support the genuineness of the document. The court analyzed the conflicting contentions to ascertain the validity of the disputed document.

Defense of no interest payment:
The respondent contended that no interest was payable on the Inter-Corporate Deposit, claiming it was a compensation measure. However, the court found this defense to be an afterthought, as subsequent actions and communications contradicted the no-interest claim. The defense was deemed not bona fide, and the court rejected it based on the evidence presented.

Validity of winding-up petition:
The respondent argued that the authenticity dispute warranted a civil suit rather than a winding-up petition. The court disagreed, emphasizing that the defense must be bona fide and not a tactic to evade a legitimate claim. The court found the defense of no interest payment untenable and directed the respondent to deposit a specified amount pending a civil suit for recovery.

The judgment concluded by directing the respondent to deposit Rs. 40 lakhs in court, pending the petitioner's filing of a recovery suit. Failure to comply would result in the admission of the petition, with publication requirements outlined. The court balanced the need for a fair resolution with the legal procedures, ensuring the parties' rights were upheld while addressing the repayment and interest dispute effectively.

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