2002 (2) TMI 1346 - HC - Companies Law

Court Admits Company Petitions, Defers Publication, Requires Payment in Installments

The court admitted the company petitions but deferred publication, requiring the respondent to pay outstanding dues in installments. The respondent was ... - Issues Involved:1. Whether the amount outstanding as claimed by the petitioner in each company petition is admitted or notRs.2. Whether the respondent is estopped from denying the liability already admitted and acknowledgedRs.3. Whether the respondent in both the company petitions could persist in its counterclaim towards damages or loss after having given up the same, and whether the plea of counterclaim is a valid defense to the claim of the petitionerRs.4. Whether the petitioner in each of the company petitions has made out a prima facie case to proceed further by admitting the company petition and ordering publicationRs.5. Whether the respondent could be put on terms after admission and before ordering publicationRs.6. To what relief, if anyRs.Detailed Analysis:1. Admitted Outstanding AmountThe court noted that the respondent admitted its liabilities towards the value of supplies and services rendered by the petitioner. The amount claimed by the petitioner in both company petitions was not disputed. The petitioners' names were shown as sundry creditors in the respondent's audited balance sheets, confirming the outstanding amounts. Therefore, the court answered this issue in favor of the petitioner.2. Estoppel from Denying LiabilityThe court found that the respondent had acknowledged and confirmed its liabilities on multiple occasions through various letters and reconciliation statements. The respondent had also withdrawn all claims against the petitioners by a letter dated 25.5.2000. Consequently, the respondent was estopped from denying the liability already admitted and acknowledged.3. Validity of CounterclaimsThe court held that the respondent's counterclaims regarding defective supplies and delays were not sustainable as the respondent had withdrawn these claims unconditionally. The withdrawal letters were considered fatal to the respondent's plea of counterclaim. Hence, for the limited purpose of the company petitions, the counterclaims did not constitute a valid defense.4. Prima Facie Case for Admission and PublicationThe court determined that the petitioner had made out a prima facie case for the admission of the company petitions. However, considering the potential consequences of ordering publication (which could disrupt the respondent's operations and affect public services), the court decided to defer the publication of the petitions.5. Terms for Respondent Before Ordering PublicationThe court decided that instead of ordering immediate publication, it would be more appropriate to give the respondent an opportunity to liquidate the outstanding dues in reasonable installments. This approach was deemed necessary to avoid catastrophic consequences for the respondent's business and public services.6. Relief GrantedThe court admitted the company petitions but deferred the publication, directing the respondent to deposit specific amounts within two months and to pay the remaining outstanding amounts in ten equal bimonthly installments. Failure to comply with these conditions would entitle the petitioner to move the court for publication and further consequential orders leading to winding up.Conclusion:The court admitted the company petitions but deferred their publication, imposing conditions on the respondent to liquidate the outstanding dues in installments. The respondent was estopped from denying the admitted liabilities, and its counterclaims were not considered a valid defense. The decision aimed to balance the interests of both parties while avoiding disruption to public services.