A winding-up petition cannot be used as a means to enforce payment of a debt that is bona fide disputed by the company.

1. - This company petition has been filed under section 439 read with section 433(e), Companies Act, 1956 (hereinafter to be called the Act') for winding up Rajasthan Petro-Synthetics Ltd., RIICO Industrial Area, Sukher (Udaipur) (hereinafter to be called the respondent-company).

2. The case of the petitioner-company, in short, is as follows : It was incorporated on 5 June, 1991, and it took over running business of the proprietorship firm, Dawn Communications, New Delhi, along with all its assets and liabilities. The respondent company was incorporated on 21 February, 1983, as a public limited company. By its letter dated 28 February, 1990, it appointed Dawn Communications, New Delhi, as their advertising agents and requested them to prepare designs and proposals for various items at the earliest. Accordingly, job work was done and six bills (Annexure D) of the total amount of Rs. 75,891.60 were submitted to the respondent company. The bills clearly provided that discrepancies, if any, be brought to the notice of the firm within three days of the presentation of the bill and delayed payments will attract interest @ 24%. The matter regarding the payment of the bills was discussed by the managing director of the petitioner company with Shri Anil Aeron, General Manager (Marketing), of the respondent company. The bills were corrected during the discussions as were agreed upon in between them. Payment orders : 'rate checked, O.K., verified amounts, please pay' were passed on them. The total amount of the bills endorsed and accepted comes to Rs. 71,876.60. Photostat copy of the bills accepted and passed bills are Annexure 'E'. Despite it, their payment have not been made. On 18 May, 1990, the director of the petitioner company wrote letters to the respondent company. In its reply dated 1 June, 1991, the respondent company raised unfounded objections arid bogus dispute. Despite the service of the notice served under section 434 of the Act, the respondent company has not made any payment.

3. In its reply, the respondent company admits that Dawn Communications was their agent, said order was placed, goods were received along with bills (Annexure D), notice (dated 18.5.91) (Annexure F) and statutory notice dated 19.7.91 (Annexure H) were received. It has further been averred by it that the goods supplied did not conform to the order placed, rates were not settled, the petitioner company was requested to furnish necessary particulars of the materials used and to got the matter settled, and it is ready to pay the amounts of the bill after making deduction of Rs. 40,993.60. It has also been averred that the company petition is not maintainable, there is a bona fide dispute in between the parties with regard to its liability, the office of the respondent company who passed the bills was not authorised to do so, there was no contract in between the parties with regard to the rates of the goods supplied and the company petition has been filed prior to the transfer of the business, assets and liabilities to M/s. Dawn Communications (P) Ltd.

4. The preliminary objection raised by the respondent company that the company petition has been filed by the petitioner company before the transfer of the business, assets and liabilities of the proprietorship firm-M/s. Dawn Communications (P) Ltd. to the petitioner company, has been decided in favour of the petitioner company, vide order dated 8 April, 19942, holding that a prospective creditor can also maintain such a company petition.

5. Another preliminary objection was raised during the final arguments that no notice was served by the petitioner company under section 434(1) of the Act and as such, it cannot be said that the respondent company is unable to pay its debt. Admittedly, notice dated 18.5.91 (Annexure F) was served by the creditor (M/s. Dawn Communications (P) Ltd.) upon the respondent company and reply dated 1.6.91 (Annexure G) was given by it. No objection has been raised in it that