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2021 Supreme(Mad) 2053

IN THE HIGH COURT OF JUDICATURE AT MADRAS
G. JAYACHANDRAN, J.
Bajaj Electricals limited, Represented by Bhupendra Shah, Mumbai – Appellant
Versus
Southern Petrochemicals Industries Corporation Limited, Chennai – Respondent
Comp. A. Nos. 49 & 50 of 2021 in C.P. No. 298 of 2014
Decided on : 08-10-2021

Advocates:
Advocate Appeared:
For the Appellant :Satish Parasaran, Senior Counsel, Thriyambak J. Kannan, Advocate.
For the Respondent:AR. L. Sundaresan, Senior Counsel, A.L. Ganthimathi, Advocate.

Headnote:

COMPANIES Act, 1956 - Section 433 (e) and (f), 434(1)(a) and 439(1)(b) - Companies (Court) Rules, 1959 - Rule 9, 11(b) - Company petition - Joint bid for construction - Notice for winding up - Respondent sought supplies from applicant's company for purpose of submitting a joint bid for construction of Four Hundred (400) KV D/C Neyveli-Sriperumbudur transmission line and Four Hundred (400) KV S/C Neyveli TS-II (Expansion) Line Associated with Neyveli (Expansion) project in Southern Region, as per tender floated by Power Grid Corporation of India Limited. Consequently, respondent placed purchase order on the applicant which was later modified/amended in year and total value of purchase order - Applicant has raised 15 invoices on respondent - Except few payments in instalments, still balance is pending due and payable - Respondent addressed a letter to applicant requesting to send Auditors to confirm amount due and payable as per their books of account - Whether liability admitted vide letter dated later disputed, is a bona fide dispute or not - Held, these applications are not fish expenditure or roving enquiry but strongly pegged on admission of liability by respondent - When respondent asked for details of invoices and debts payable, applicant herein has meticulously furnished details and statement of ledger accounts - Inspite of furnishing details sought, respondent has not come forward to share statement of accounts maintained by respondent - In law refusal to interrogatories (or) refusal to produce documents (or) non-compliance with order for discovery is by applicant, he shall have the suit dismissed for want of prosecution and if it is by respondent, his defence will be struck off and will be placed in position as if he is not defended - Application No.49 of 2021 is allowed.

JUDGMENT :

(Prayer: Company Application has been filed under Order XIV Rule 8 of Original Side Rules read with Rule 9, 11(b) of the Companies (Court) Rules, 1959, praying to direct the respondent to produce the following:-

(a) Business Transfer Agreement dated 05.08.2011;

(b) Ledger Statement;

(c) Balance sheet for the period 2009-till 2014 maintained by the respondent for transactions with the applicant/petitioner accompanied by an affidavit stating on oath the correctness of the contents of the same.

Company Application has been filed under Order XIV Rule 8 of Original Side Rules read with Rule 9, 11(b) of the Companies (Court) Rules, 1959, praying to permit the delivery of interrogatories, as annexed to this affidavit to the respondent, consequently, direct the respondent to respond to the same within a time period as may be directed by this Hon'ble Court.)

1. Alleging that the respondent company owing a sum of Rs.7,35,27,663.27/- and it is unable to pay the said debt, the company petition is filed for winding up is filed under Section 433 (e) and (f), 434(1)(a) and 439(1)(b) of the Companies Act, 1956. The petitioner herein has taken out these applications under Order XI, Rules 1 and 2 and 12 of the Code of Civil Procedure 1908 to put forth interrogatories to the respondent company and for an order directing the respondent to produce certain specific documents within its possession, so as to obtain certain vital facts for material decision of this case.

2. According to the applicant, the respondent sought supplies from the applicant's company for the purpose of submitting a joint bid for construction of Four Hundred (400) KV D/C Neyveli-Sriperumbudur transmission line and Four Hundred (400) KV S/C Neyveli TS-II (Expansion) Line Associated with Neyveli (Expansion) project in the Southern Region, as per the tender floated by the Power Grid Corporation of India Limited. Consequently, the respondent placed purchase order on the applicant on 21.10.2005, which was later modified/amended in the year 2009 and the total value of the purchase order was Rs.45,23,88,717.88. The applicant has raised 15 invoices on the respondent. Except few payments in instalments, still balance of Rs.7,35,27,663/- is pending due and payable. On 1.06.2010, the respondent addressed a letter to the applicant requesting to send Auditors to confirm the amount due and payable as per their books of account as on 31.03.2010. The respondent has admitted in the said letter that, a sum of Rs.4,89,13,725/- is due and payable to the applicant/ petitioner. The applicant on received of their letter of confirmation of debt, informed the respondent in the very same communication that a sum of Rs.7,35,27,663/- is the outstanding. Thus, as per the letter dated 28.06.2010 signed by the respondent, admittedly, they are liable to pay Rs.4,89,13,725/- Whereas the respondent claims Rs.7,27,663/-.

3. Hence, after issuance of statutory notice for winding up, claiming outstanding of Rs.7,35,27,663/-, the company petition for winding up has been filed and the present applications are filed seeking leave of this Court to put forth interrogatories and the documents to be produced form part of the petition as annexure.

4. The respondent herein has filed a common counter wherein, it is stated that, in the Company Court jurisdiction, Order XI, Rule 1 of the Civil Procedure Code is not applicable. Especially, when the respondent is denying the liability, the application filed to determine the liability by making roving enquiry is not maintainable. The respondent cannot fish out evidence by abusing the process of law. By filing this application, the applicant is trying to convert the company petition into a Civil Recovery Suit.

5. Learned Senior Counsel appearing for the applicant/petitioner submitted that, on 21.10.2005, the respondent-SPIC-SMO placed purchase order for supply of power parts and earthing strips setting out the terms and conditions. The said purchaser order was subsequently amen

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