Shantilal Chhotelal and Company vs Beta Napthol Limited

A.M. Sapre, J.—This company petition is filed by the creditor of the respondent company on the ground covered u/s 433(e) of the Companies Act, it is the case of petitioner that their money dues are outstanding on the respondent company and despite the demand made and statutory notice served as required u/s 434 of the Act on the respondent company, the same not having been paid, the need to file this company petition u/s 433(e) of the Act, i.e., on the ground of inability to pay debt has arisen.

It is not in dispute that during pendency of this company petition, the respondent company was declared as a sick industrial company by BIFR under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA), and eventually, the BIFR by order dated 23.5.2000 passed u/s 20(2), ibid., referred the case of respondent company to this Court for passing the winding up of company. It was held by BIFR that the respondent company is not a viable company, that it has lost its substratum, that there is no chance of it becoming a running concern, and, hence, it was sent to this Court for passing a final winding up order in accordance with the provisions of Section 20(2) of SICA. This Court has accordingly, received the said reference. It is registered as Company Petition No. 26 of 2002. It is pending for passing final winding up order in relation to respondent company.

In view of aforesaid admitted fact, namely, that a proceedings for passing final winding up orders in relation to respondent company are pending, and the same are being examined by this Court, there is no point in entertaining this petition, nor is there any point in keeping this petition pending, nor there arises any point in hearing this petition along with the said company petition, i.e., 26 of 2002 for the simple reason that petitioner will have to now prove their claim/debt before the Official Liquidator now to be appointed in other company petition like any other claimant/creditor. This Court would be examining the claim of several creditors through and with the aid of Official Liquidator for passing a final order of winding up. Under these circumstances, the petitioner will have to submit its claim with proof in those proceedings in accordance with the provisions of Companies Act.

It is for these reasons, I do not consider it proper to either keep this petition pending and dispose it of by granting liberty to the petitioner to submit their claim before the Official Liquidator as and when called upon to do so for verification against the respondent company. Such course is legal and in conformity with the procedure prescribed under the Companies Act. There is no prejudice caused to the petitioner by disposal of this petition, because their right in relation to claim against the respondent company is fully secured by this Court

It is with these observations that I decline to entertain this company petition. It is accordingly, disposed of.

No costs.