This is a petition seeking winding up of a private limited company. The petitioner and his wife hold 47.5% of the shares and the second respondent and the members of his family hold another 47.5%.

2. According to the petitioner, the father of the second respondent was also interested in an item of property over which the petitioner envisaged interest, to build a multi-storied residential complex and that the father of the second respondent and the petitioner reached an understanding to float a company and it was accordingly that the aforesaid company came into force and one James Paul, a retired Chief Engineer was brought into the Company to seek his advice. The Company was formed with the main object of purchasing, developing, selling etc. of buildings and to construct houses, hospitals, flats, apartments etc. and to carry on the business of building contractors and undertake and carry out building construction works and to engage in trading of building materials of any kind. According to the petitioner, though the project began in 1994 and several flats were allotted, the cash inflow was insufficient to obtain the desired pace for the construction of such a project and ultimately a loan was raised through the Federal Bank by depositing the title deeds of the property of the company and further collateral security, including at the risk of the petitioner executing documents.

3. The petitioner contends that the Federal Bank insisted on additional collateral security after it moved the Debt Recovery Tribunal pursuant to failed negotiations and Mr. P.D. Xavier, the father of the second respondent provided additional security and the Bank agreed to realize the undivided share in the properties, so that the Company could execute the sale deed in favour of the allottees. According to the petitioner, he arranged for sale of certain flats and thereafter played a pivotal role in making the project viable and he has also given his personal property as security and the third respondent acted in such a manner that the developments of the further events as regards the Company, were detrimental to the interest of the petitioner. According to him, the Company is essentially a partnership of two families and cannot carry on business, for having lost mutual faith and confidence and that the trust exposed by the petitioner on the second respondent has apparently turned out to a misplaced. In the said premise, it is contended that, to protect the interest of the petitioner, who is the original promoter of the Company, there is no alternative other than to have the Company wound up so that the petitioner will be able to get his share of profits. Accordingly, an order for winding up is sought for.

4. In opposition, the respondents challenge the sustainability of the winding up petition and contend that, the petitioner, if at all, has efficacious and alternative remedy before the Company Law Board under Section 397 of the Companies Act. Contentions are also raised on the merits, by alleging that the transaction with the Federal Bank is not as contended by the petitioner and that the petitioner had abandoned his responsibilities attached to the post of Managing Director and left for the Persian Gulf in early 2001. It is pleaded by the respondents that no situation has arisen for winding up of the Company and that the petition is filed in a manner to force the Company to part with certain portions, of the structure constructed, in a manner as the petitioner would desire to have it.

5. Various precedents as to the questions to be considered in a winding up petition, as also on the question as to whether nature of relationship between the parties is that of a partnership or not, have been referred by counsel on either side.

6. Learned counsel for the petitioner referred to the judgment in Ragunath Prasad Jhunjhuwala and another V. Hind Overseas Private Limited (1971) 41 C.C. 308 to urge that if a private company could be fairly called a partner