2016 (8) TMI 1542 - HC - Companies Law

Court admits winding up petition against company for failure to pay debts, issues publication order

M/s Mitsu Engineering Versus Jailaxmi Sugar Products (Nitali) Pvt. Ltd.

The Court admitted the Company Petition for winding up the Respondent Company due to its failure to pay debts amounting to Rs. 3.44 Crores, including ... Seeking to wind up the Respondent Company - Winding sought on the ground that it is unable to pay its debts - HELD THAT:- The huge amounts are due and payable by the Respondent Company to the Petitioner and which are undisputed. In fact, in discharge of their liability, the Respondent Company had also issued cheques aggregating to a sum of ₹ 2.20 Crores which have been dishonoured. In these circumstances, the Respondent Company is unable to pay its debts which would entitle the Petitioner to an order of admission of the Company Petition. The Company Petition is admitted and made returnable on 19 September, 2016. Issues:- Winding up of the Respondent Company- Failure to pay debts by the Respondent Company- Dishonored cheques issued by the Respondent Company- Service of statutory notice and Company Petition- Admittance of the Company Petition- Advertisement and publication requirementsWinding up of the Respondent Company:The Company Petition was filed seeking to wind up the Respondent Company due to its inability to pay debts amounting to Rs. 3.44 Crores, inclusive of interest. The Petitioner had supplied materials to the Respondent Company as per purchase orders, raising tax invoices totaling Rs. 2,21,81,246. The Respondent Company issued four cheques amounting to Rs. 2.20 Crores in discharge of their liability, but these cheques were dishonored due to insufficient funds.Service of Statutory Notice and Company Petition:The statutory notice and Company Petition were served on the registered office of the Respondent Company. Despite the notices being returned unclaimed, the service was deemed complete and valid based on the company's registered office address matching the service address. The Court relied on previous decisions to confirm the sufficiency of service, emphasizing that the Respondent Company had been duly notified.Admittance of the Company Petition:After reviewing the documents and proceedings, the Court found that substantial amounts were owed by the Respondent Company to the Petitioner, with the debt being undisputed. The dishonor of the issued cheques further indicated the Respondent Company's inability to pay its debts. Consequently, the Court admitted the Company Petition, scheduling a return date for further proceedings.Advertisement and Publication Requirements:The Court ordered the advertisement of the Company Petition in two local newspapers and the Maharashtra Government Gazette. The Petitioner was directed to deposit a sum towards publication charges, with non-compliance leading to the dismissal of the Company Petition. The publication requirements were outlined to ensure proper notice and adherence to the Companies (Court) Rules, 1959.