2011 (8) TMI 965

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....ompany. For several years it has been dealing with the respondent Company which has its registered office at 3, Hungerford Street, Kolkata - 700 017. For the last 25 years the Company has been supplying glass and allied products to the petitioning creditor maintaining a mutual open and current account. It appears that this account was discussed between the parties on 14-9-2009. The minutes of discussion are annexure 'B' to the petition at page 26. According to these minutes the Company admitted that it had dues towards the petitioning creditor of a sum of a little over Rs. 1.1 crores. Hearing the submissions of the learned Counsel for the parties, I have understood that the petitioning creditor used to keep in deposit substantial sums of mo....

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.... the amount lying deposited with them. This amount lying deposited with them was subject to a deduction of not over Rs. 20, 000 per consignment to be supplied by them to the petitioning creditor. The relationship between the parties had not come to an end. The Company was continuously making supply of goods to the petitioning creditor in terms of the agreement dated 14-9-2009. Therefore, that statement of accounts was subject to the terms of that agreement. 6. Moreover the Affidavit-in-Reply of the petitioning creditor, and more particularly paragraph 6 thereof shows that the adjustments were being made against supply as a result of which Rs. 1,01,48,543.37 was reduced to Rs. 50,08,921 in the hands of the Company. In fact, the seller Com....

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.... the claim of Rs. 50,08,921. Therefore, there is some evidence to suggest that the relationship between the parties continues; but is liable to termination at once. 11. But there is no doubt in my mind that, as of now a sum of Rs. 50,08,921belonging to the petitioning creditor is retained by the seller Company. The Company has practically no defence. The above findings are prima facie. 12. In this case I will apply the principles in the case of Mechalec Engineers & Mfgs. v. Basic Equipment Corpn. AIR 1977 SC 577 paragraph 8. These principles are held to be applicable in a winding up application. The judgment holds that even when the defendant does not seem to have any defence, the Court may out of sympathy allow it an opportunity to p....