Store One Retail India Ltd. vs Waterfall Infra Pvt. Ltd.

By this company petition, the petitioner seeks winding up of the respondent company and prays for appointment of the Official Liquidator of all the assets, business, affairs, property, books of accounts etc. with all powers under the Companies Act, 1956.

It is the case of the petitioner that the respondent company approached the petitioner for supply of Ready Mix Concrete. It is th case of the petitioner that during the period between March, 2013 and 7th April, 2013, the petitioner supplied the said material worth Rs.17,84,500/- to the respondent company at the address mentioned in the purchase order. The respondent received the said goods without any protest as to the quality or quantity of the said goods. The petitioner thereafter issued the invoices on 16th April, 2013 and 30th April, 2013 to the respondent company for the said supply effected by the petitioner.

On 20th May, 2013, the respondent issued a cheque in the sum of Rs.3.00 lakh as part payment in favour of the petitioner. On 18th June, 2013, the respondent company issued another cheque of Rs.3.00 lakh as part payment to the petitioner. On 31st August, 2013, the respondent company issued a cheque of Rs.1.00 lakh as part payment.

It is the case of the petitioner that on 1st October, 2013, the petitioner addressed an e-mail to the respondent and called upon the respondent to pay the outstanding amount of Rs.10,84,000/-. It was the case of the petitioner that due to oversight the amount outstanding mentioned in the said e-mail was Rs.10,70,000/- as against the amount of Rs.10,84,000/-. On 21st October, 2013, the meeting between the representative of the petitioner and the representative of the respondent came to be held. It is the case of the petitioner that in the said meeting, the respondent admitted its liability and outstanding amount and requested for some time to make payment. On 23rd October, 2013, the petitioner sent a reminder to the respondent to pay the outstanding amount. Even in the said e-mail, the amount erroneously mentioned as Rs.10,70,000/- instead of Rs.10,84,000/-.

The respondent sent a reply to the said e-mail on 23rd October, 2013. In the subject, it was mentioned the "Outstanding balance of Rs.10,70,000/-. The respondent informed the petitioner that the respondent would release some payment by Monday or Tuesday of the said week and agreed to pay the balance amount probably in another 3 to 4 months. The respondent called upon the petitioner to send the statement of the outstanding amount for verification. There was further correspondence exchanged between the parties by which the petitioner sent reminder for payment to the respondent. Since no amount was forthcoming, the petitioner issued a statutory notice dated 29th December, 2014 to the respondent demanding payment of Rs.10,84,000/- with further interest thereon under section 434(1)(a) of the Companies Act, 1956.

Though the said statutory notice was received by the respondent, there was no reply to the said notice by the respondent. The petitioner accordingly filed this company petition. According to the petitioner, the petitioner has to recover a sum of Rs.14,63,421/- from the respondent as on the date of filing of the company petition. The respondent has filed affidavit in reply to this petition. Rejoinder is filed by the petitioner.

Mr.Khandeparkar, learned counsel appearing for the petitioner invited my attention to the various annexures annexed to the petition and submits that there was inadvertent error in two emails sent by the petitioner. He submits that instead of Rs.10,84,000/-, inadvertently an amount of Rs.10,70,000/- was mentioned. He also invited my attention to the reply to the said e-mail sent by the respondent and would submit that even according to the respondent, the balance outstanding was Rs.10,70,000/-. The respondent though agreed to make some payment on or before Monday or Tuesday of the said week and agreed to pay the balance amount probably in another 3 to 4 months, no payments were made by the respondent. He submits that since there was no reply to the statutory notice, presumption has to be drawn by this Court that the respondent was unable to pay its debts.

He also invited my attention to some of the averments made in the affidavit in reply. He submits that the allegations of the respondent that the goods supplied by the petitioner were not in accordance with the specification mentioned in the purchase order is after thought. No complaint of any nature was made by the respondent in the correspondence till the date of filing of the affidavit in reply. He submits that these allegations are made for the first time in the affidavit in reply.

Learned counsel invited my attention to the averments made in paragraph 10 of the affidavit in reply, in which the respondent admitted that it had made payment for goods supplied which were upto the mark and as per the specification requisitioned by the respondent company. He submits that each and every defence raised by the respondent now raising an issue of alleged defective goods is after thought.

It is submitted that the respondent has already made payment of Rs.7.00 lakh as and by way of part payment and while making such payment, never raised any such issue of alleged defective goods.

Mr.Saluja, learned counsel for the respondent on the other hand submits that there were over writings in the invoices annexed to the petition. He does not dispute that the respondent had not addressed any letters during the course of supply of various material by the petitioner, alleging supply of defective goods. He submits that in one of the e-mail sent by the petitioner, the petitioner demanded a sum of Rs.10,70,000/-, whereas in another e-mail the petitioner has claimed an amount of Rs.10,84,000/-. He submits that since there is a difference in the claim made by the petitioner in the correspondence, on that ground alone, the petition shall be dismissed.

It is submitted by the learned counsel that the invoices which are annexed to the petition, were not received by the respondent. He also disputed the contents of such invoices. Learned counsel however, could not point out before this Court the copies of other invoices, which were received by the respondent, which according to him were the correct invoices.

There was no correspondence addressed by the respondent pointing out any discrepancy in the goods. He submits that the respondent company is managed by the unskilled employees and thus no such correspondence was addressed. He submits that there is no provision for payment of interest in any of the invoices relied upon by the petitioner for payment of interest.

Insofar as the e-mail addressed by the respondent company is concerned, it is submitted that even the said e-mail indicates that the respondent had called upon the petitioner to supply the statement of account which were never supplied.

Mr.Khandeparkar, learned counsel for the petitioner in rejoinder invited my attention to the averment made in paragraph 10 of the company petition and reply of the respondent in paragraph 14 thereto. It is submitted that in paragraph 14, the respondent has admitted that the contents of paragraph 10 are correct and needs no comment.

Insofar as the submission of the learned counsel for the respondent that there are discrepancies in the amounts claimed in the two e-mails by the petitioner is concerned, the learned counsel placed reliance on the judgment of this Court in case of Tata Finance Limited, Mumbai vs. Kanoria Sugar & General Manufacturing Company Limited, Mumbai, 2002(1) Mh.L.J. 617 and in particular paragraphs 8 and 11. He submits that even if according to the respondent the correct outstanding amount of the petitioner is Rs.10,70,000.- and not Rs.10,84,000/- since the amount involved is more than Rs.500/-, the company petition cannot be dismissed on the ground of the alleged discrepancy in the amount claimed.

The respondent did not reply to the statutory notice and did not pay any amount, a presumption thus has to be drawn against the respondent that the respondent is unable to pay its debts.

I have perused the documents annexed to the petition, including the e-mails exchanged between the parties. A perusal of the e-mails indicates that the petitioner had inadvertently mentioned the amount of Rs.10,70,000/- as against the amount of Rs.10,84,000/- as outstanding. In the reply to the said notice, the respondent has admitted the outstanding amount of Rs.10,70,000/-. Since the amount admitted by the respondent was more than Rs.500/-, this petition for winding up cannot be dismissed on the ground that there is difference in the amount claimed by the petitioner in the two e-mails. This Court has already taken such a view in case of Tata Finance Limited, Mumbai (supra), I am respectfully bound by the said judgment. There is thus no substance in this submission of the learned counsel for the respondent.

The respondent in the affidavit in reply admitted that the goods supplied by the petitioner were of the specification as ordered by the respondent. Not a single letter is addressed by the respondent to the petitioner alleging supply of any defective goods or that the goods were not as per the specification. In my view, the defence now raised for the first time in the affidavit in reply deserves to be rejected. The defence now raised by the respondent is moonshine.

Insofar as the submission of the learned counsel for the respondent that there is no provision for payment of interest in the invoices is concerned, there is no bar under the invoices from payment of interest. In any event since the admitted liability is more than Rs.500/-, the petition deserves to be admitted.

In my view, since the respondent has failed to pay the admitted dues, the petitioner has made out a case for grant of interim relief in terms of prayer clause (d). However, it is made clear that the respondent shall be permitted to deal with or dispose of the assets in ordinary course of business. The respondent shall maintain accounts and shall furnish a copy of such account every six months from today to the petitioner.

I therefore, pass the following order :- a). The company petition accordingly is admitted and shall be advertised in two local newspapers, namely (i) Free Press Journal (in English) and Navshakti (in Marathi) as also in the Maharashtra Government Gazette. Any delay in publication of the advertisement in the Maharashtra Government Gazette, and any resultant inadequacy of notice shall not invalidate such advertisement or notice and shall not constitute non-compliance with this direction or with the Companies (Court) Rules, 1959.

b). The company petition is made returnable after eight weeks. The petitioner shall deposit Rs.10,000/- towards publication charges with the Prothonotary & Senior Master, under intimation to the Company Registrar, within two weeks from the date of admission, failing which the petition shall stand dismissed for the nonprosecution without further reference to the Court. After the advertisements are issued, the balance, if any, shall be refunded to the petitioner.

c). Learned counsel for the respondent waives service of notice under Rule 28 of the Companies (Court) Rules, 1959.