Rajasthan High Court - Jodhpur
Nitin Alloys Private Limited vs Rajendra Jain & Anr on 21 February, 2017
Bench: Govind Mathur, G.R. Moolchandani
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
D.B. Special Appeal Civil No. 3 / 2014
In
Company Petition No.3/2004
Shri Nitin Lohiya s/o Shri Satya Narayan Ji Lohiya, aged about 41
years, Director/Promoter of M/s Nitin Alloys Private Limited 27-A-
63, Adarh Society Near Shastri Circle, Jodhpur.
----Appellant
Versus
1. Rajendra Jain s/o Shri Panna Lal Ji Jain, resident of 80 Dev
Nagar, Jodhpur.
2.s M/s Raj Kamal Industries, through its partner Shri Rajendra
Jain s/o Shri Panna Lal Ji Jain resident of 80 Dev Nagar, Jodhpur.
----Respondents
_____________________________________________________
For Appellant(s) : Mr. Manoj Bhandari
For Respondent(s) : Mr. Sharad Kothari
_____________________________________________________
HON'BLE MR. JUSTICE GOVIND MATHUR
HON'BLE MR. JUSTICE G.R. MOOLCHANDANI Judgment 21/02/2017 (2 of 7) [SAC-3/2014] This appeal is before us to assail correctness of the order dated March 25, 2014, passed by learned Single Bench accepting a Company Petition with a direction to appoint a liquidator of the company.
An application is also preferred by the appellant as per provisions of Order 41 Rule 27 Code of Civil Procedure to place on record the documents Anx.1 to Anx.7.
Learned counsel appearing on behalf of rival parties advanced their arguments relating to the application aforesaid and also on merits of the appeal.
Before coming to other facts of the case, it would be appropriate to state that the Company Petition was heard and decided by learned Single Bench without the assistance of counsel for the appellant herein by recording that "the learned counsel Mr. Siddharth Joshi submits that despite having sent several communications, he has not received any further instructions in the matter from the respondent company. None else is present for the respondent".
The facts necessary to be noticed are that as per the respondent No.1 herein Shri Rajendra Jain advanced a sum of Rs.7,20,100/- to M/s Nitin Alloys Private Limited (hereinafter referred to as 'the company'), a company incorporated under the Companies Act. The borrower assured to issue its shares in lieu of (3 of 7) [SAC-3/2014] the said amount. The share certificates as assured were not issued, therefore, under a letter dated 22.7.2003 the respondent herein requested the Director of the company to furnish audited balance sheet. Under a communication dated 31.7.2003 it was conveyed on behalf of the company that no claim for any document can be made being the M/s Rajkamal Industries, a sundry creditor. The respondent petitioner again requested to the company and its management to make payment of advance made, but on being failed to have that, a petition was filed as per provisions of Sections 434(e) and 434(f) of the Companies Act, 1956 (hereinafter referred to as 'the Act of 1956'). In the petition, besides the facts already stated, it was also averred that the respondent petitioner also stood as guarantor in his personal capacity as the security of loan taken by the company from the State Bank of India, Jodhpur and that loan too was not satisfied and this fact establishes that the company is not in position to satisfy its liabilities.
A reply to the company petition was filed with a specific denial for borrowing the sum of Rs.7,20,100/- from the respondent petitioner. It was alleged that the statement of account prepared is a tailored one. It was also stated that a private limited company cannot accept unsecured loan from a person who is not member of the company, in fact some scrapped material was supplied to the appellant respondent and for payment of that the respondent petitioner is to be treated as a sundry creditor, who is not entitled to claim audited balance sheet (4 of 7) [SAC-3/2014] of the company. It was also urged that in absence of any documentary evidence, the claim made remains disputed, which cannot be adjudicated in company petition, but is required to be adjudicated in a civil suit with the aid of cogent evidence. A specific statement was also made that the company has fully settled its account with the State Bank of India, therefore, the respondent petitioner was not at all having any liability being the guarantor. It was also emphasised that the respondent petitioner is first required to establish accepted liability on the part of the company and in absence of that it cannot be concluded that the company is unable to pay its debts under Section 434(c) of the Act of 1956, thus, is liable to wind up under Section 434(e) and 434(f) of the Act.
Learned Single Bench, under the judgment impugned, held that the company has not denied in categorical terms the fact that it owes money to the respondent petitioners, whereas the respondent petitioners pointed out with reference to the ledger entries about advancing loan in a tune of Rs.7,20,100/-, hence, the company failed to satisfy the Court that the claim made was having some bonafide dispute, therefore, deserves to be ordered to be wound up by the process of the Court.
Suffice to mention that the instant appeal, at the first instance was filed by the company, but in view of the finding arrived by us under order dated 19.9.2016 that no appeal under Section 483 of the Act of 1956 could have been filed on behalf of (5 of 7) [SAC-3/2014] the company under winding up proceedings by or through its earlier Director, the Director of the company Shri Nitin Lohiya was substituted as appellant.
Heard learned counsels.
As already stated that learned Single Bench decided the company petition in absence of counsel for the company. There would have been a valid reason to dispose of the company petition in absence of counsel for the company, but we are of considered opinion that all the facts stated in reply to the company petition should have been thoroughly examined by learned Single Bench before passing an order to wind up the company, specially looking to the circumstance that in quite specific terms the liability was disputed and further the capacity to pay the loan was also disclosed, though not supported by the documents.
Be that as it may, in the application preferred under Order 41 Rule 27 Code of Civil Procedure, the appellant stated that during pendency of the company petition the appellant and his wife left the station after discharging the liability of the company by satisfying the loan advanced by the State Bank of India. The appellant also left the premises i.e. A-266, Shastri Nagar, Jodhpur, therefore, the communications said to be sent by the Advocate too were not received. It is asserted that all the facts stated in reply to the company petition could have been very well (6 of 7) [SAC-3/2014] satisfied by the documents Anx.1 to Anx.7, which are now sought to be placed on record. The application is supported by an affidavit sworn-in by appellant Shri Nitin Lohiya. No reply to the application aforesaid is filed.
Having considered all facts of the case, specially looking to the contents of reply to the company petition and also the averments contained in the documents referred in the application under Order 41 Rule 27 Code of Civil Procedure, we are of considered opinion that documents Anx.1 to Anx.7 require to be produced and considered for substantial adjudication of the company petition, which as a matter of fact is decided by drawing adverse inference.
An effort is made by learned counsel for the respondent petitioners that whatever documents now the appellant desires to place on record were available with him while contesting the company petition, therefore, such evidence now cannot be permitted to bring on record. We would like to state that the application under Order XLI Rule XXVII is preferred with desire to have the documents on record as per provisions of Order 41 Rule 27(1)(b) Code of Civil Procedure and not as per Order 41 Rule 27(1)(aa) of the Code, as such, the availability of those documents with the appellant is not at all relevant.
Accordingly, the application under Order 41 Rule 27 Code of Civil Procedure deserves acceptance, hence, is allowed.
(7 of 7) [SAC-3/2014] The documents Anx.1 to Anx.7 filed alongwith the appeal be treated as part of reply to the company petition. After taking the aforesaid documents on record, we are of the view that to meet the interest of justice it shall be appropriate to remand the company petition to learned Company Judge for its adjudication afresh on merits. Hence, the appeal is allowed. The judgment impugned dated 25.3.2014 is set aside. The company petition is remanded to learned Company Judge for its adjudication afresh.
No order to costs.
(G.R. MOOLCHANDANI)J. (GOVIND MATHUR)J. MathuriaKK/PS