JUDGMENT - F.I. REBELLO, J.:---The petitioners have filed this petition against the Company under sections 433 and 434 of the Companies Act, 1956. The statutory notice dated September 22, 1997 has been served on the Company. In reply by letter of October 24, 1997 the Company stated that the demand as made was not tenable and contended that there were serious disputes. It was further set out that the conduct of the petitioners was malicious and vexatious. The interest and charges was also disputed. It is contended that the petitioners received excess payments by way of interest. It was further pointed out that the Company could cancel the transactions entered into by the Directors which were detrimental to the business interests of the Company and its shareholders. Lastly it is contended that there was a bona fide dispute. It is further averred that the Company is liable to pay the amounts decided by the Competent Court or by mutual negotiations.

The case of the petitioners is that the Company had approached the petitioners for deposits and at the request of the Company the petitioners lent and advanced working capital between 5th December, 1995 to 23rd October, 1996 as intercorporate deposit totalling to Rs. 2,30,00,000/-. To secure due repayment the Company issued 8 postdated cheques. In the meantime the Company approached the petitioners for renewing the deposits as the Company was not in a position to repay the amounts on maturity. At the request of the Company the petitioners agreed to further renew the deposit totalling Rs. 2,30,00,000/- on the Company executing fresh sets of security documents. Towards the various amounts which were renewed the petitioners were secured by the following documents:--

(i) Demand Promissory Note.

(ii) Postdated cheques for the same.

(iii) Intercorporate Deposit Receipt.

(iv) Letters of assurance.

The various dates are not being referred to as they differ from deposit to deposit. The various amounts and their renewal are set out in paragraph 10(a) and 10(h) of the petition. By separate letters the Company agreed to pay interest at the rate of 22.5% per annum and had in fact paid interest at the said rate. It is also averred in para 12 that Mr. Dhirajlal H. Vora, Mrs. Ranjana Dhirajlal Vora, Mr. Rajesh Dhirajlal Vora, Mrs. Sunayana Rajesh Vora, Dhirajlal H. Vora (HUF) and Rajesh Dhirajlal Vora (HUF) were the contractual tenants of certain properties on the 4th Floor of a building known as Mehta Mahal which belonged/owned by the trust known as Mehta Charitable Trust. The said persons had agreed to give collateral security of the tenanted premises in favour of the petitioners by six agreements of Leave and License. Creation of license requires the permission of the landlord. The petitioners requested the office bearers of the Company to obtain the necessary permission. Under some pretext or the other written permission of the landlord was not obtained and as such the said agreements had not been acted upon nor did the agreements create any collateral security as was intended when the agreements were entered into. The petitioners after giving notice to the Company presented 8 postdated cheques. The said cheques, however, when presented were dishonoured either on account of payment stopped by the drawer or exceeding arrangement. The petitioners have filed separate proceedings under section 138 of the Negotiable Instruments Act on account of dishonour of cheques. Thereafter the statutory notice was served. It is contended that the Company did not dispute their liabilities by replying to the notice nor secured the petitioner and as such the Company was due and owing to the petitioners an amount of Rs. 2,54,54,349,31 paise with further interest as set out therein. In para 19 of the petition it is pointed out that the Company is indebted to the petitioners and Associate Companies in a sum of more than Rs. 4.00 crores. It is also averred that the petitioners have come to know that there are a large number

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