TaxTMI 
TaxTMI 
2025 (7) TMI 574
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....be lent by the respondent (original petitioner). An undertaking and personal guarantee of the Managing Director of the appellant (original respondent) was also executed for repayment of money to the respondent (original petitioner). A Letter of Credit was also drawn in favour of the respondent (original petitioner) by the appellant (original respondent). 3. In August 1998, two cheques were issued by the appellant (original respondent) in favour of the respondents (original petitioner) for a sum of Rs. 90,00,000/- and Rs. 1,77,80,849/-. These cheques were not honoured and therefore, proceedings under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) were initiated against the appellant (original respondent) by the respondent (original petitioner). 4. In September 1998, the appellant's (original respondent) bankers raised certain objections with regard to the Letter of Credit worth Rs.44,74,000/-. Though the appellant (original respondent) cleared discrepancies, the amount was not paid to the respondent (original petitioner). 5. In December 1998, the respondent (original petitioner) wrote a letter to the appellant (original respondent) requesting that they resolve....
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....he learned Single Judge in Summary Suit No.4441 of 2001 where the appellant (original respondent) was found to be liable to make the payment. This order and decree has not been challenged by the appellant (original respondent) and neither the decree has been discharged. Learned counsel further submitted that since foundation of winding up proceedings were dishonour of cheques and non-honouring of Letter of Credit and Metropolitan Magistrate subsequently, has acquitted the appellant (original respondent) from the offence under Section 138 of the NI Act, the whole basis of winding up notice falls. Learned counsel for the appellant (original respondent) relied upon the following two decisions in support of the submissions and prayed for allowing the appeal:- (i) Madhusudan Gordhandas & Co. Vs. Madhu Woollen Industries Pvt. Ltd. (2021) 1 SCC 414 and (ii) Satish Chander Ahuja Vs. Sneha Ahuja (2021) 1 SCC 414. 13. None appeared for the respondent (original petitioner). Analysis & Conclusion:- 14. Section 433 of the Companies Act, 1956 provides for circumstances in which the Court may wind up a company. The circumstances are specified in clauses (a) to (i). Clau....
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....eferred to its earlier communications regarding recovery of outstanding dues and stated that the statement of accounts as desired by the appellant (original respondent) were already furnished in March 1999, but still the appellant (original respondent) has not cleared the dues. Therefore, the respondent (the original petitioner) requested that the appellant (the original respondent) repay the dues. There is no rebuttal/reply to this particular letter. 21. The appellant (original respondent) having failed to pay the dues, respondent (original petitioner) issued a statutory winding-up notice in July 2001 to the appellant (original respondent) giving the history of the transaction and requesting the appellant (original respondent) to make total payment of Rs. 3,68,29,634/- within a period of 21 days failing which the respondent (original petitioner) would initiate civil/criminal and/or winding up proceedings. This statutory notice was replied by the appellant (original respondent) vide letter dated 21 July 2001. In the said reply, the appellant (original respondent) merely requested for various documents and vaguely and baldly in one sentence denied the allegation contained in the ....
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....the same, till the filing of the reply to the winding up petition aslateas March 2002. Therefore, letter of 27 February 1999 relied upon in reply to the winding up petition has no relevance. 25. The Appellant (original respondent) in the reply admitted that cheques were towards service charges and same is also the finding of Metropolitan Magistrate. If that be so, then we fail to understand why the debt was unpaid since the transactions have to be examined as a whole. The Calcutta High Court in the case of John Paterson & Co. (I) Ltd Vs. Pramod Kumar Jalan (1983) 53 Com Cases 255 (Cal.), ordered winding up where the company admitted amount was received not as a loan but for issuing debentures and there was failure to repay debt and interest. 26. From the above factual analysis, we have no iota of doubt that the grounds raised for opposing the winding up are not bona fide but an afterthought and only to subvert winding up proceedings. 27. The reason for enacting Section 433(e) of the Act for winding up of companies which are unable to pay its debts is to ensure that such companies do not carry out their activities in future with other creditors and dupe new creditors. This ....
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....ings in criminal proceedings cannot be relied upon while adjudicating civil proceedings. Therefore, we do not agree with the learned counsel for the appellant (original respondent) with his submissions that the findings in these criminal proceedings shows bona fide of dispute and therefore same should be followed without anything else. The findings in criminal proceedings cannot be taken as sacrosanct for deciding civil matters. 31. Even assuming based on the reliance placed by the appellant (original respondent) on the decision of the Supreme Court in the case of Satish Chander Ahuja (supra) if we take cognisance of the orders passed in criminal proceedings, then with the same breath we cannot ignore the order of this Court in Summary Suit No. 4441 of 2001 where on the basis of these very cheques, a decree was passed against the appellant (original respondent). On a query being raised, we were informed by the learned counsel for the appellant (original respondent) that the appellant (original respondent) had not made any payments towards this decree till today and they have also not challenged the said order passed on 5 August 2011. Therefore, by accepting the submission of the....
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....t raised any dispute with respect to the amount due till the filing of the reply to the winding up petition. The defence in the reply is only taken almost after long lapse of time and in the interregnum no correspondence disputing the amount has been addressed by the appellant (original respondent) but on the contrary a demand promissory note was executed for an admitted amount and interest. Furthermore, in the instant case before us there are no activities in the appellant company nor there are any assets as stated by the learned counsel for the appellant (original respondent). There is already a decree against the appellant (original respondent) arising out of the very same transaction and which decree till today has remained unpaid and unchallenged. 36. Therefore, looking at the facts of the present case, the decision in the case of Madhusudan Gordhandas & Co. (supra) do not take the case of the appellant (original respondent) any further. 37. In this connection, it is worthwhile to reproduce para 21 of the decision in the case of Madhusudan Gordhandas & Co (supra) which reads as under: "Where the debt is undisputed the court will not act upon a defence that the c....