2010 (9) TMI 1307 - HC - Companies Law

Public Company Ordered to Dissolve Over Unpaid Dues; Official Liquidator Appointed to Oversee Process.

Sapta Innovation Design & Consulting (P.) Ltd. Versus Worldmartt Retail Stores and Services Ltd.

The HC granted the petition for winding up under Section 434 of the Companies Act, ordering the dissolution of the respondent public limited company due ... - Issues:Petition for winding up under Section 434 of the Companies Act.Analysis:The petitioner, a private limited company, sought to wind up the respondent, a public limited company, due to outstanding dues. The petitioner provided design and brand promotion services to the respondent as per a memorandum of understanding dated 7-6-2008. Invoices were raised, and cheques issued by the respondent were dishonored. Despite multiple reminders and a statutory notice, the respondent failed to pay the outstanding amount of Rs. 19,86,721.85. The respondent's defense of substandard services by the petitioner was raised belatedly and was deemed invalid by the court.The court noted that the respondent's registered office was sealed, indicating non-functionality. The respondent's failure to pay dues and the sealing of its office demonstrated its inability to meet financial obligations. The court found the petitioner's claim to be substantiated by the evidence provided, including the memorandum of understanding, invoices, dishonored cheques, and the respondent's admission of debt in its reply.Consequently, the court allowed the petition, ordered the winding up of the respondent company, and appointed the Official Liquidator as the liquidator. The petitioner was directed to deposit Rs.25,000 for initial winding up expenses, publish the order in a newspaper, and serve a certified copy to the Registrar of Companies within specified timelines.