Appeal sets aside order dissolving partnership in winding-up petition, dismissed suit relief not granted.

The appeal was allowed, setting aside the Company Judge's order to dissolve the partnership. The Court held that ordering dissolution in a winding-up petition, after a suit for dissolution had been dismissed, was improper. It was emphasized that relief from the dismissed suit could not be granted in the winding-up petition.

---

---

Issues Involved:
1. Whether the petitioner is a creditor of the company within the meaning of section 439(b) of the Indian Companies Act.
2. Whether the petitioner is a debtor of the company.
3. Whether it is just and equitable to order winding up of the company.
4. Whether the company petition is maintainable in view of the various suits pending in the Civil Courts.
5. Whether the company petition is maintainable in view of OS No. 616/83 on the file of the court of the 1st Addl. Judge, City Civil Court, Hyderabad, for dissolution and rendition of accounts of the firm, Progressive Engineering Company.
6. Whether the company petition is liable to be dismissed without enquiry.
7. Whether the petitioner has any locus standi to file the company petition and the same is bona fide.
8. Whether the petitioners are creditors within the meaning of section 433(e) read with section 434(1)(a) of the Indian Companies Act and within the meaning of section 439(1)(b).
9. Whether the respondent-company is indebted to the petitioners in a sum exceeding Rs. 500 as on the date of the petition and, if so, what is the amount due.
10. Whether the petitioners made demand requiring the respondent to pay the sum due and has served the said demand of the company at its registered office.
11. Whether the respondent admits the liability.
12. Whether the petitioners have issued the statutory notice of 21 days.
13. Whether the respondent-company has complied with the said notice as per law.
14. Whether the company petition is not maintainable without adding the partners of the petitioner-firm as parties to the company petition.
15. Whether the petitioners have no locus standi to file the company petition.
16. Whether the amount alleged to be due to the petitioners is admitted by the company and whether the company is not able to meet the said liability.
17. Whether CP No. 11 of 1983 is not maintainable in view of the suits filed by the respondent against the said firm claiming Rs. 4,36,000 from the said firms and other legal proceedings pending in the lower Courts.
18. Whether the petitioners are in fact put up by the petitioner in CP No. 6 of 1983 on the file of this court for his benefit.
19. Whether the company petition is bad and not maintainable on the ground that no leave of the court under section 439(8) of the Companies Act was sought and obtained.
20. Whether the present petition is bad in view of the pendency of the suit OS No. 1065 of 1984 on the file of the II Additional Judge, City Civil Court, Hyderabad.
21. Whether the respondent-company is liable to be wound up under sections 433(e) and 434(1)(a) and section 439(1)(b) of the Indian Companies Act.
22. To what relief.

Issue-wise Detailed Analysis:

Issue 1: Whether the petitioner is a creditor of the company within the meaning of section 439(b) of the Indian Companies ActRs.
The petitioner claimed that he was a creditor of the firm PEC, which was transferred to the respondent-company, and was owed Rs. 1,74,928. The Company Judge did not specifically address this issue in the judgment, but the petitioner's claim was based on the balance sheet as on 31-3-1981.

Issue 2: Whether the petitioner is a debtor of the companyRs.
This issue was not explicitly addressed in the judgment.

Issue 3: Whether it is just and equitable to order winding up of the companyRs.
The Company Judge found that there was a lack of probity and mismanagement in the conduct of the company's affairs. The conversion of the partnership into a private limited company was deemed illegal, unauthorized, and mala fide. The Judge concluded that it was just and equitable to dissolve the partnership, citing the loss of mutual faith and confidence among partners and the partnership being at will.

Issue 4: Whether the company petition is maintainable in view of the various suits pending in the Civil CourtsRs.
The Company Judge held that the pendency of other suits did not bar the dissolution of the partnership.

Issue 5: Whether the company petition is maintainable in view of OS No. 616/83 on the file of the court of the 1st Addl. Judge, City Civil Court, Hyderabad, a suit for dissolution and rendition of accounts of the firm, Progressive Engineering CompanyRs.
The Company Judge determined that the pendency of OS No. 616/83 did not preclude ordering the dissolution of the partnership.

Issue 6: Whether the company petition is liable to be dismissed without enquiryRs.
This issue was not explicitly addressed in the judgment.

Issue 7: Whether the petitioner has any locus standi to file the company petition and the same is bona fideRs.
The Company Judge found that the petitioner had established beyond doubt the lack of probity and mismanagement, thus affirming the petitioner's locus standi.

Issue 8: Whether the petitioners are creditors within the meaning of section 433(e) read with section 434(1)(a) of the Indian Companies Act and within the meaning of section 439(1)(b)Rs.
This issue was not explicitly addressed in the judgment.

Issue 9: Whether the respondent-company is indebted to the petitioners in a sum exceeding Rs. 500 as on the date of the petition and, if so, what is the amount dueRs.
This issue was not explicitly addressed in the judgment.

Issue 10: Whether the petitioners made demand requiring the respondent to pay the sum due and has served the said demand of the company at its registered officeRs.
This issue was not explicitly addressed in the judgment.

Issue 11: Whether the respondent admits the liabilityRs.
This issue was not explicitly addressed in the judgment.

Issue 12: Whether the petitioners have issued the statutory notice of 21 daysRs.
This issue was not explicitly addressed in the judgment.

Issue 13: Whether the respondent-company has complied with the said notice as per lawRs.
This issue was not explicitly addressed in the judgment.

Issue 14: Whether the company petition is not maintainable without adding the partners of the petitioner-firm as parties to the company petitionRs.
This issue was not explicitly addressed in the judgment.

Issue 15: Whether the petitioners have no locus standi to file the company petitionRs.
This issue was not explicitly addressed in the judgment.

Issue 16: Whether the amount alleged to be due to the petitioners is admitted by the company and whether the company is not able to meet the said liabilityRs.
This issue was not explicitly addressed in the judgment.

Issue 17: Whether CP No. 11 of 1983 is not maintainable in view of the suits filed by the respondent against the said firm claiming Rs. 4,36,000 from the said firms and other legal proceedings pending in the lower CourtsRs.
This issue was not explicitly addressed in the judgment.

Issue 18: Whether the petitioners are in fact put up by the petitioner in CP No. 6 of 1983 on the file of this court for his benefitRs.
This issue was not explicitly addressed in the judgment.

Issue 19: Whether the company petition is bad and not maintainable on the ground that no leave of the court under section 439(8) of the Companies Act was sought and obtainedRs.
This issue was not explicitly addressed in the judgment.

Issue 20: Whether the present petition is bad in view of the pendency of the suit OS No. 1065 of 1984 on the file of the II Additional Judge, City Civil Court, HyderabadRs.
This issue was not explicitly addressed in the judgment.

Issue 21: Whether the respondent-company is liable to be wound up under sections 433(e) and 434(1)(a) and section 439(1)(b) of the Indian Companies ActRs.
The Company Judge found that winding up the company was not necessary as the company was doing well and the business was flourishing. Instead, the Judge ordered the dissolution of the partnership.

Issue 22: To what reliefRs.
The Company Judge ordered the dissolution of the partnership instead of winding up the company, finding it just and equitable under section 44(g) of the Indian Partnership Act.

Conclusion:
The appeal was allowed, and the order of the Company Judge dissolving the partnership was set aside. The Court held that the Company Judge could not have ordered the dissolution of the partnership in a winding-up petition, especially when a suit for dissolution had been dismissed for default and the matter was concluded between the parties. The Court emphasized that the relief sought in the dismissed suit could not be granted in the winding-up petition.

---