TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Company ordered to pay debt to petitioner after court deems defenses invalid. Winding-up petition admitted.</h1> <h3>Mehras Books Private Limited Versus Random House Publishers India Private Limited.</h3> Mehras Books Private Limited Versus Random House Publishers India Private Limited. - TMI Issues Involved:1. Existence of Debt2. Bona Fide Dispute3. Breach of Contract4. Return of Books5. Quantum of Debt6. Winding Up PetitionDetailed Analysis:1. Existence of Debt:The petitioner, Random House Publishers India Pvt. Ltd., claimed that Mehras Books Pvt. Ltd. owed an outstanding amount of approximately Rs. 1.38 crores. The petitioner provided evidence of unsettled accounts and multiple demands for payment. The company acknowledged the debt in emails, indicating an intention to pay by August 15, 2013.2. Bona Fide Dispute:The company argued that the debt was contingent upon the receipt of payment from its customers and claimed that the property in the goods did not pass to them unless sold. The court examined whether the company's defense was bona fide and substantial. The company raised issues about the credit notes and alleged that the petitioner supplied books without their assent and dumped non-marketable books in their warehouse. However, the court found these defenses vague and unsupported by contemporaneous evidence.3. Breach of Contract:The company alleged that the petitioner breached the contract by creating parallel supply channels and delaying the release date of new titles, causing significant losses. The court noted that the distributorship agreements did not limit the number of distributors and found no substantial evidence supporting the company's claim of breach.4. Return of Books:The company attempted to return unsold books, but faced delays or failures in confirmation from the petitioner. The court observed that the company did not provide convincing evidence to support its claim about the return of books and noted that the petitioner had suggested a plan for payment and reconciliation.5. Quantum of Debt:The court emphasized the need to establish the quantum of debt conclusively. The company admitted to owing Rs. 1.38 crores in emails but later disputed the amount. The court found that the company's defenses were an afterthought and lacked bona fide. The court directed the company to furnish security for Rs. 60 lakhs, considering all grievances for rebate and SOR.6. Winding Up Petition:The court referred to various legal principles and precedents, including Mechelec Engineers and Manufacturers vs. Basic Equipments Corporation, Madhusudan Gordhandas & Co. vs. Madhu Woollen Industries Pvt. Ltd., and others. The court concluded that the company's defenses were illusory and intended to evade payment. The court admitted the winding-up petition for Rs. 60 lakhs and directed the company to furnish security. If the security is furnished, the petition will remain permanently stayed; otherwise, it will be advertised.Conclusion:The court found that the company owed a debt to the petitioner and that the defenses raised were not bona fide or substantial. The winding-up petition was admitted for Rs. 60 lakhs, and the company was directed to furnish security to stay the petition.
TaxTMI 
TaxTMI 
