1. This is a winding up application coming up for admission. The cause of action is founded on unpaid price of goods sold and delivered.
Case of the petitioning Creditor:
2. The case of the petitioning creditor is the simplest conceivable case on the above cause of action. According to them, between 3rd September, 2009 and 31st December, 2009 they sold and delivered a quantity of Lam Coke to the Respondent. Its price was Rs. 1,92,52,851/-. They were sold and delivered further to a purchase order dated 1st September, 2009 of the Respondent to them which is Annexure ''A'' to the petition. A statement of invoices together with copy invoices are annexed to it as Annexure ''B''.
3. Five cheques for Rs. 1,25,00,000/- were issued by the Respondent to them. Each was for Rs. 25,00,000/-. Out of these, three cheques were presented first, but dishonoured for insufficiency of funds of the Respondent. Thereafter, all five cheques were presented but returned unpaid on the ground that the Respondent had stopped their payment. This exercise was done between 11th November, 2009 and 17th November, 2009..
4. Statements of account are relied on by the petitioning creditor in the affidavit-in-reply confirmed on behalf of the Respondent by one Vijay Mohata.
5. The usual statutory notice was issued on behalf of the petitioning creditor on 13th April, 2010. The petitioning creditor''s case is that it was not replied to. One statement of account was for the period ending 31st March, 2010 and another for the period 1st April, 2010 to 30th April, 2010. It is said that such statements of account show that Rs. 1,92,52,851/- is due and owing by the Respondent to the Petitioner.
Respondent''s Case
6. Now, the case of the Respondent.
7. First, it says, that the above statutory notice was replied to by them under certificate of posting. According to the Petitioner no such reply was received by them. In any event, no such reply was ever made. Thus there is a presumption of insolvency u/s 434(1)(a) of the Companies Act, 1956.
8. Secondly, the petitioning creditor was to supply coke manufactured by one Krishna Coke (lndia) Pvt. Ltd. Reliance has been placed on the writing "account Krishna Coke" in the purchase order. According to them the petitioning creditor did not supply such coke.
9. There is also a quality dispute. The petitioning creditor had to vouch for the quality of its goods by a "SGS report". No such report was there and therefore the quality of the goods was defective. This defective coke has caused damage to the Respondent, it was said in Court that this defective coke damaged the boiler or furnace of the Respondent by not effectively healing it. Loss and damage to the Respondent ensued from it.
10. Further the statements of account annexed to the affidavit-in-reply are suspect. Mohata had left their services in the beginning of May, 2010.
11. Further, it was said that there were verbal negotiations between the petitioning creditor and the Respondent whereby the petitioning creditor was asked not to negotiate the cheques. But they did so in violation of such oral negotiations. Mr. Talukdar, appearing on behalf of the Respondent submits that his client has a bona fide defence and that this winding up application should be dismissed.
Discussion and Conclusions:
12. Section 434(1)(a) enacts that if a statutory notice is not replied to, there is a presumption of insolvency.
13. When not replying to a statutory notice has such a serious consequence, I am quite intrigued by the defence taken by the Respondent company that the reply to the statutory notice was sent under certificate of posting. Under such mode of despatch there is no record of receipt. Secondly, a sender of a reply to the statutory notice under that mode of service is under a serious risk of facing an argument, which the Respondent now makes that no such reply to the statutory notice was made by the Respondent. There is no answer why such an important document was allegedly sent in such a fashion.
14. Although, lot of verbal negotiations, discussion and promises have been pleaded, there is no contemporaneous document whatsoever, to substantiate the alleged defence taken by the Respondent company in their affidavit-in-opposition. There is not even a letter recording that the supplied goods were defective or that they did not match the quality of goods of Krishna Coke or that they damaged the boiler or furnace of the Respondent causing damage.
15. There is nothing on record to show that any steps were taken by the Respondent against this person Mohata.
16. Further, I do not believe the statement made by the Respondent in their affidavit that the petitioning creditor was asked not to encash the cheques for Rs. 1,25,00,000/-.
17. In my opinion, there was unconditional admission of liability by the Respondent by tendering cheques for Rs. 1,25,00,000/- and there is no evidence to explain otherwise.
18. Now, the question is whether the winding up application is to be admitted or not. In
19. In
20. In this particular case on the principles laid down in those judgments, the Respondent has no defence to the claim of Rs. 1,25,00,000/- representing the value of cheques payment of which was stopped.
21. But I take into consideration one factor. The goods were supplied up to 31st December, 2009. This winding up application was filed on 14th May, 2010. There is a whisper about damages being suffered by the Respondent. But as I have said there is no evidence whatsoever to even remotely suggest it. However, considering that this winding up application was filed only six months after close of supply and that damages caused to the boiler or furnace from allegedly defecting supply may become evident or quantifiable at a later point of time, I use my discretion under sub paragraph ''e'' of the judgment in Mechalec Engineers and Manufacturers v. Basic Equipment Corporation (supra) for the balance part of the claim.
22. Therefore, the winding up application is admitted on the above prima facie finding that Rs. 1,25,00,000/- is due and owing by the Respondent company to the petitioning creditor. The difference between Rs. 1,92,52,851/- and Rs. 1,25,00,000/- is relegated to suit upon furnishing of bank guarantee, by the Respondent company to the petitioning creditor within two weeks from the date of issuance of a copy of this order. The suit is to be filed within four weeks from such date. On failure to furnish bank guarantee the whole claim will stand admitted. Upon furnishing of bank guarantee the Respondent will keep the bank guarantee renewed from time to time subject to orders of the Civil Court. The petitioning creditors will not encash the bank guarantee without leave of the Court. If no suit is filed the Respondent may not continue with the bank guarantee.
23. Therefore, the winding up application is admitted advertisements are to be published once in the Times of India and once in Ananda Bazar Patrika. Publication in the Official Gazette is dispensed with. Such publication is to be made within four weeks from date. List this application six weeks hence.
24. However, this order is stayed for six weeks to enable the Respondent company to take steps, as they may be advised.
25. Urgent certified photocopy of this judgment and order, if applied for to be provided upon complying with all formalities.
