Himachal Pradesh High Court
Euro Containers vs Morepen Laboratories Ltd. on 23 March, 2006
Equivalent citations: [2007]78SCL168(HP), 2007(1)SHIMLC153
Author: Deepak Gupta
Bench: Deepak Gupta
JUDGMENT V.K. Gupta, C.J.
1. We have heard the learned Counsel for the parties and perused the impugned judgment dated 15th March, 2004 rendered by learned Single Judge of this Court whereby the winding up application filed by the appellant has been dismissed on the ground that the appellant has already instituted a suit for recovery of amount in question and the suit is pending disposal in the Civil Court. In taking this view, the learned Single Judge has been influenced by an earlier view expressed in a Single Judge judgment of this Court in the case of M/s. Azeet International Pvt. Ltd. v. Himachal Pradesh Horticultural Produce Marketing & Processing Corporation Ltd. reported in 1998 (2) Shim. L.C. 10.
2. We have perused the aforesaid judgment in the case of M/s. Azeet International Pvt. Ltd. (supra) and find that indeed in that case the learned Single Judge has taken the view (in para 13 of the judgment) that the Civil Suit for recovery of the amount forming subject-matter of winding up application stood filed already, and since the suit had been pending adjudication, the machinery for winding up could not be used merely as a means for realizing a debt which was disputed and had been subject-matter of the suit. The following observations in M/s. Azeet International Pvt. Ltd. (supra) being apposite are quoted hereinbelow:
There is yet another aspect of the case. Admittedly, a civil suit for the recovery of the amount, claimed in the present petition, has been filed by the petitioner-company against the respondent-company and such suit is pending adjudication. Under these circumstances, the machinery for winding up cannot be allowed merely as a means for realizing a debt, which is disputed and is subject-matter of a suit. The High Court of Punjab and Haryana in State Trading Corporation of India Ltd. v. Punjab Tanneries Ltd. (1989) 66 Company Cases 634, also had declined to exercise the powers under Section 433 of the Act, in view of the fact that the petitioner therein had already resorted to a civil suit for recovery of the disputed debt.
3. Since in the impugned judgment dated 15th March, 2004 a reference was indeed made to M/s. Azeet International Pvt. Ltd. (supra), it can safely be said that what the learned Single Judge had in mind while dismissing the winding up application was that the liability to pay was disputed and based on that the appellant had indeed filed a Civil Suit which was pending adjudication. It is well established that unless the liability to pay is acknowledged by the Company, for recovery of a debt if a Civil Suit has already been filed with respect to a disputed liability, winding up application does not lie.
There is no merit in the appeal. The appeal is dismissed.