Court rules in favor of petitioner in debt acknowledgment case, orders winding up of respondent company.

The court found that the respondent-company had acknowledged its debt to the petitioner-firm within the limitation period, thus the claim was not barred by limitation. Additionally, the court determined that the respondent-company was unable to pay its debts, leading to the decision to wind up the company. The petitioner was instructed to publish the winding-up order and submit a copy to the Registrar of Companies within 30 days. The company petition was granted without costs awarded.

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Issues Involved:
1. Whether the claim of the petitioner-firm is barred by limitation.
2. Whether the respondent-company is unable to pay up its debts requiring it to be wound up.

Issue-Wise Detailed Analysis:

1. Whether the claim of the petitioner-firm is barred by limitation:

The petitioner-firm sought the winding up of the respondent-company under sections 433(e), 434(1)(a), and 439(1)(b) of the Companies Act, 1956. The respondent-company contested the petition, claiming that any liability was time-barred. However, the court found that the respondent-company had acknowledged its debt to the petitioner-firm on several occasions, specifically through agreements dated 19-1-2000 and 21-3-2001. The court noted that these acknowledgements of debt reset the limitation period under Section 18 of the Limitation Act, 1963. Since the company petition was filed on 6-9-2002, within three years of the last acknowledgment, the claim was not barred by limitation.

2. Whether the respondent-company is unable to pay up its debts requiring it to be wound up:

The court examined the evidence, including letters and agreements between the parties. The petitioner-firm provided evidence of unpaid dues, including a sum of Rs. 7 lakhs paid towards electricity reconnection charges. The respondent-company admitted to owing money to several creditors and having ongoing recovery proceedings initiated by banks. The court found that the respondent-company had not repaid its debts to the petitioner-firm and was unable to clear its liabilities. The court rejected the respondent's defense that the debt was unascertained or unadjusted, noting that the respondent had acknowledged the debt multiple times.

Conclusion:

The court concluded that the respondent-company was unable to pay its debts and ordered its winding up. The petitioner was directed to notify the winding-up order by publication in specified newspapers and lodge a certified copy of the order with the Registrar of Companies within 30 days. The company petition was allowed, and no costs were awarded.

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