Karnataka High Court
U.V. Shenoy vs Karnataka Engineering Products Co. ... on 2 January, 1981
Equivalent citations: [1983]54COMPCAS40(KAR), 1981(1)KARLJ145
JUDGMENT Chandrakantaraj Urs, J.
1. This is a petition filed by one, U. V. Shenoy under s. 433(e) and (f) read with ss. 434(1)(a) and 439(1)(b) of the company companies Act (hereinafter referred to as "the Act") prying or an order winding up the 1st respondent-company.
2. It is petitioners cafe that the 1st respondent-company owes a sum of Rs. 33,490.55 in respect of certain items of goods supplied by him to the company. It is unnecessary to set out in detail the claim. It is further alleged that some of the amounts due had in fact been paid by cheques which on presentation to the Syndicate Bank Gandhinagar branch, came to be dishonoured. In that circumstance of a fresh demand was made and statutory notice issued in spite of which the 1st respondent-company and the directors failed and neglected to pay the sums demanded. Therefore, the petition.
3. The petition has been resisted on the ground the two sums are due by the company or its directors to the petitioner inasmuch as the various items of goods supplies were returned as they were of substandard quality that what was contorted for. It is further alleged by the managing doctor of the company that on account of the sub-standard quality of goods supplied by the petitioner, his contract to supply link panels to the Indian Telephone Industries was cancelled and, therefore, the petitioner is not entitled to his prayer.
4. The parties were permitted to file documents and mark the same by consent. Oral evidence of the petitioner as well as the managing director of the 1st respondent-company in respect of their respective stands was also record by me. On carefully going throat the evidence I am satisfied that the 1st respondent company has a tenable defence for the claim made by the petitioner. To decide the question as to what sums would be due in the ultimate analyses is not possible in this summary proceeding No doubt, the fact of the issuance of the cheques and the same being dishonoured has been established. That however has been explained by the 2nd respondent. I any event, I am satisfied, prima facie, that it is a matter which more can appropriately be agitated in a properly framed suit in a civil court than be agitated in this summary proceeding as to the liability of the respondents.
5. This is not a fit case in which this court should exercise its discretion under s. 433 of the Act and proceed to make an order for the winding up the 1st respondent-company.
6. Therefore, the petition it rejected with liberty reserved for the petitioner to recover the sums from the respondents in a properly framed suit in a civil action in accordance with law.
7. But, in the circumstances of the case, there will be no order as to costs.