2005 (6) TMI 298

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....admitted for hearing and a direction was issued for its publication in two daily news papers. 2. Mr. Soparkar, learned counsel for the appellant submitted that the transaction between the appellant-company and the original petitioner/ respondent was a loan transaction which at the cost and expenses of the present appellant was insured. The loan transaction took place somewhere in the year 1993 and after the appellant failed to make the payment, the respondent/the principal creditor received the money from the insurance company. It was submitted by him that the court should not exercise its discretion as the suit was already filed. However, while we were dictating the judgment, he submitted to us that the suit was instituted at least four....

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....ue of gross assets as per the balance-sheet far exceeded its liability leaving a substantial balance surplus for the shareholders far in excess of their contribution. He has also relied upon Division Bench judgment of this court in the matter of Tata Iron and Steel Co. v. Micro Forge (India ) Ltd. [2000] 2 GLR 1594; [2001] 104 Comp Cas 533. In the said matter, a Division Bench of this court has summarised the legal principles and observed that in what particular cases a company petition should not be admitted. The Division Bench, however, has observed that the discretion is to be exercised by the learned company judge in the matter like present in favour of the company, if the net worth is positive and the company is ready and willing to di....

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....the money to the principal creditor, then the appellant-company is not answerable to anybody. The appellant-company is still liable and applying the principle of subrogation, the insurance company can always recover the money from the appellant and in any case, if the money is received by the creditor-company then, to the extent of the receipts, the creditor-company would refund the money to the insurance company. That would be a matter between the insurance company and the creditor-company. The debtor is not entitled to take any benefits out of the said transaction. 7. The said judgment in the matter of Tata Iron and Steel Co. v. Micro Forge (India) Ltd. [2000] 2 GLR 1594 ; [2001] 104 Comp Cas 533 , does not apply to the facts of the pr....