2014 (1) TMI 1961 - HC - Companies Law

Dispute Over Commission Payments Leads to Dismissal of Winding Up Petition; Adjudication Needed in Civil Court.

Sri. S. Gopinath Versus M/s. Davanam Constructions Private Limited, Bangalore

The HC dismissed the petition for winding up the respondent company, determining that the dispute over commission payments and alleged document ... Petition for winding up the respondent company - Entitlement to a fixed amount of commission in respect of a particular property - issuance of notice under Sections 434 and 433(e) of the Companies Act, 1956 - HELD THAT:- The document produced by the respondent – Company is a bogus document. The original agreement is available with the petitioner and that he would seek to produce the same to demonstrate that the respondent has willfully fabricated and tampered with the document in claiming that the amount fixed for the charges is limited to a sum of Rs. 1,00,00,000/- and the fact that there is an admitted circumstance of the respondent having paid Rs. 1,00,71,000/- to the petitioner, if the agreement was only for Rs. 1,00,00,000/-, is a circumstance to denote that the respondent is not above board and seeks that there be an adjudication insofar as the amount is concerned. The matter requires to be adjudicated and it is appropriate if the petitioner should approach the Civil Court in this regard. The petitioner does not make up a ground for winding up the respondent, in view of the vehement and serious dispute between the parties - Petition disposed off by way of remand. Issues: Dispute over commission payment for property lease, fabrication of documents, petition for winding up the respondent companyIn this judgment, the petitioner, belonging to the Mudaliar community, claimed to have special connections within the community and facilitated a lease agreement between M/s. Rao Bahadur B.P. Annaswamy Mudaliar C.I.E's Public Charities and the respondent, for which he was to receive a commission. The petitioner alleged that despite partial payments, the balance amount was not paid, leading to the filing of a petition under Sections 434 and 433(e) of the Companies Act, 1956. The respondent denied the claims, arguing that the petitioner fabricated documents to demand additional amounts beyond the agreed sum of Rs. 1,00,00,000. The respondent contended that it had already paid Rs. 1,00,71,000, challenging the petitioner's credibility and the need for winding up the company.The respondent's counsel vehemently denied the petitioner's claims, stating that the petitioner had manipulated documents to support his demands. The respondent argued that the petitioner's credibility was questionable, and there was no admitted claim justifying the winding up of the company. The petitioner, in response, maintained that the respondent lacked credibility and was a shadow company. The petitioner alleged that the respondent had tampered with the original agreement, and he possessed evidence to prove the fabrication. The petitioner sought an adjudication on the payment dispute, highlighting the discrepancy between the agreed amount and the sum already paid by the respondent.The court, after considering the arguments presented, concluded that the dispute between the parties required adjudication in a Civil Court. The court found that the petitioner's claims did not warrant the winding up of the respondent company, given the serious disagreements and lack of clarity in the case. Therefore, the petition was dismissed without prejudice to the petitioner's right to pursue the matter further in a Civil Court for resolution in accordance with the law.