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Judgment
This appeal is before us to assail correctness of the
order dated March 25, 2014, passed by learned Single Bench
accepting a Company Petition with a direction to appoint a
liquidator of the company.
An application is also preferred by the appellant as per
provisions of Order 41 Rule 27 Code of Civil Procedure to place on
record the documents Anx.1 to Anx.7.
Learned counsel appearing on behalf of rival parties
advanced their arguments relating to the application aforesaid and
also on merits of the appeal.
Before coming to other facts of the case, it would be
appropriate to state that the Company Petition was heard and
decided by learned Single Bench without the assistance of counsel
for the appellant herein by recording that "the learned counsel Mr.
Siddharth Joshi submits that despite having sent several
communications, he has not received any further instructions in
the matter from the respondent company. None else is present for
the respondent".
The facts necessary to be noticed are that as per the
respondent No.1 herein Shri Rajendra Jain advanced a sum of
Rs.7,20,100/- to M/s Nitin Alloys Private Limited (hereinafter
referred to as ''the company''), a company incorporated under the
Companies Act . The borrower assured to issue its shares in lieu of
the said amount. The share certificates as assured were not
issued, therefore, under a letter dated 22.7.2003 the respondent
herein requested the Director of the company to furnish audited
balance sheet. Under a communication dated 31.7.2003 it was
conveyed on behalf of the company that no claim for any
document can be made being the M/s Rajkamal Industries, a
sundry creditor. The respondent petitioner again requested to the
company and its management to make payment of advance made,
but on being failed to have that, a petition was filed as per
provisions of Sections 434(e) and 434(f) of the Companies Act,
1956 (hereinafter referred to as ''the Act of 1956''). In the petition,
besides the facts already stated, it was also averred that the
respondent petitioner also stood as guarantor in his personal
capacity as the security of loan taken by the company from the
State Bank of India, Jodhpur and that loan too was not satisfied
and this fact establishes that the company is not in position to
satisfy its liabilities.
A reply to the company petition was filed with a specific
denial for borrowing the sum of Rs.7,20,100/- from the
respondent petitioner. It was alleged that the statement of
account prepared is a tailored one. It was also stated that a
private limited company cannot accept unsecured loan from a
person who is not member of the company, in fact some scrapped
material was supplied to the appellant respondent and for
payment of that the respondent petitioner is to be treated as a
sundry creditor, who is not entitled to claim audited balance sheet
of the company. It was also urged that in absence of any
documentary evidence, the claim made remains disputed, which
cannot be adjudicated in company petition, but is required to be
adjudicated in a civil suit with the aid of cogent evidence. A
specific statement was also made that the company has fully
settled its account with the State Bank of India, therefore, the
respondent petitioner was not at all having any liability being the
guarantor. It was also emphasised that the respondent petitioner
is first required to establish accepted liability on the part of the
company and in absence of that it cannot be concluded that the
company is unable to pay its debts under Section 434(c) of the
Act of 1956, thus, is liable to wind up under Section 434(e) and
434(f) of the Act.
Learned Single Bench, under the judgment impugned,
held that the company has not denied in categorical terms the fact
that it owes money to the respondent petitioners, whereas the
respondent petitioners pointed out with reference to the ledger
entries about advancing loan in a tune of Rs.7,20,100/-, hence,
the company failed to satisfy the Court that the claim made was
having some bonafide dispute, therefore, deserves to be ordered
to be wound up by the process of the Court.
Suffice to mention that the instant appeal, at the first
instance was filed by the company, but in view of the finding
arrived by us under order dated 19.9.2016 that no appeal under
Section 483 of the Act of 1956 could have been filed on behalf of
the company under winding up proceedings by or through its
earlier Director, the Director of the company Shri Nitin Lohiya was
substituted as appellant.
Heard learned counsels.
As already stated that learned Single Bench decided
the company petition in absence of counsel for the company.
There would have been a valid reason to dispose of the company
petition in absence of counsel for the company, but we are of
considered opinion that all the facts stated in reply to the
company petition should have been thoroughly examined by
learned Single Bench before passing an order to wind up the
company, specially looking to the circumstance that in quite
specific terms the liability was disputed and further the capacity to
pay the loan was also disclosed, though not supported by the
documents.
Be that as it may, in the application preferred under
Order 41 Rule 27 Code of Civil Procedure, the appellant stated
that during pendency of the company petition the appellant and
his wife left the station after discharging the liability of the
company by satisfying the loan advanced by the State Bank of
India. The appellant also left the premises i.e. A-266, Shastri
Nagar, Jodhpur, therefore, the communications said to be sent by
the Advocate too were not received. It is asserted that all the facts
stated in reply to the company petition could have been very well
satisfied by the documents Anx.1 to Anx.7, which are now sought
to be placed on record. The application is supported by an affidavit
sworn-in by appellant Shri Nitin Lohiya. No reply to the application
aforesaid is filed.
Having considered all facts of the case, specially
looking to the contents of reply to the company petition and also
the averments contained in the documents referred in the
application under Order 41 Rule 27 Code of Civil Procedure, we
are of considered opinion that documents Anx.1 to Anx.7 require
to be produced and considered for substantial adjudication of the
company petition, which as a matter of fact is decided by drawing
adverse inference.
An effort is made by learned counsel for the respondent
petitioners that whatever documents now the appellant desires to
place on record were available with him while contesting the
company petition, therefore, such evidence now cannot be
permitted to bring on record. We would like to state that the
application under Order XLI Rule XXVII is preferred with desire to
have the documents on record as per provisions of Order 41 Rule
27(1)(b) Code of Civil Procedure and not as per Order 41 Rule
27(1)(aa) of the Code, as such, the availability of those
documents with the appellant is not at all relevant.
Accordingly, the application under Order 41 Rule 27
Code of Civil Procedure deserves acceptance, hence, is allowed.
The documents Anx.1 to Anx.7 filed alongwith the appeal be
treated as part of reply to the company petition. After taking the
aforesaid documents on record, we are of the view that to meet
the interest of justice it shall be appropriate to remand the
company petition to learned Company Judge for its adjudication
afresh on merits. Hence, the appeal is allowed. The judgment
impugned dated 25.3.2014 is set aside. The company petition is
remanded to learned Company Judge for its adjudication afresh.