Court Upholds Decision Dismissing Appeals on Winding-up Petitions

The court dismissed the appeals and upheld the Company Court's decision to refuse the winding-up petitions. The petitioning creditor was directed to seek a civil remedy, as the respondent companies raised a plausible defense. The court found no fault in relegating the petitioning creditor to a civil remedy, excluding the appeal period for limitation calculations under the Limitation Act, 1963.

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Issues Involved:
1. Whether the respondent companies could claim adjustment of goods sold and delivered by Concast Bengal to the appellant petitioning creditor.
2. Whether there was an agreement for the adjustment of the price of goods supplied.
3. Whether the claims of Concast Bengal were barred by limitation.
4. Whether the respondent companies could seek set-off of supplies made by Concast Bengal.
5. Whether the principles for granting a decree in summary suits apply to winding-up proceedings.
6. Whether the respondent companies raised a bona fide defense to avoid liquidation proceedings.
7. Whether the learned Company Court's decision to relegate the petitioning creditor to a civil remedy was appropriate.

Detailed Analysis:

1. Adjustment of Goods Sold:
The respondent companies contended that Concast Bengal had sold goods to the petitioning creditor, and there was an agreement for adjusting the price of goods supplied by the petitioning creditor against the dues to Concast Bengal. The petitioning creditor disputed this claim, arguing that the documents supporting the supply of goods were forged and fabricated. The court noted that whether the documents were forged or fabricated could not be decided in summary winding-up proceedings and required a regular suit in the appropriate civil court.

2. Agreement for Adjustment:
The petitioning creditor argued there was no agreement for the adjustment of the price of goods. The court observed that the pleadings suggested a proposal for such an arrangement, but whether it fructified into an agreement required evidence. The court emphasized that agreements need not always be in writing and could be oral if proved.

3. Claims Barred by Limitation:
The petitioning creditor argued that Concast Bengal's claims were barred by limitation, as there had been no acknowledgment of outstanding dues since 2009. The court acknowledged that equitable set-off debts are payable only if they arise out of the same transaction and cited relevant case law to support this principle.

4. Set-off of Supplies:
The petitioning creditor contended that the respondent companies could not set off supplies made by Concast Bengal against supplies made by the petitioning creditor. The court noted that equitable set-off requires mutual debts and credits or cross-demands to arise out of the same transaction or be connected in nature and circumstances.

5. Principles for Granting Decree in Summary Suits:
The court referred to the analogy drawn by the learned Company Court between summary suits and winding-up proceedings. It held that the principles for granting a decree or leave to defend in summary suits apply to winding-up proceedings. The court emphasized that a company must be in a completely defenseless position for it to be wound up.

6. Bona Fide Defense:
The court referred to the Supreme Court's decision in Madhusudan Gordhands & Co. vs. Madhu Woollen Industries [P] Ltd., which held that if a company raised a defense in good faith or a defense likely to succeed at trial, the winding-up application would fail. The court found that the respondent companies had raised a plausible defense, and the petitioning creditor's claims were not indisputable.

7. Relegation to Civil Remedy:
The court upheld the learned Company Court's decision to relegate the petitioning creditor to a civil remedy, as the respondent companies had raised a triable issue. The court found no infirmity in the learned Company Court's order and dismissed the appeals and connected applications.

Conclusion:
The court dismissed the appeals and upheld the learned Company Court's decision to refuse the winding-up petitions and direct the petitioning creditor to seek a civil remedy. The period during which the appeals were pending was excluded for computing limitation under Section 14 of the Limitation Act, 1963.

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