JUDGMENT
Amitava Lala, J.
1. Both the appeals are arising out of self-same order. The appellant under the first (numbered) appeal was the petitioning creditor being C. P. No. 174 of 2003 (Govinda Enterprises (P.) Ltd. v. Deepak Kejriwal) under Sections 433, 434 and 439 of the Indian Companies Act, 1956, before the learned single judge sitting in the company jurisdiction. The second (numbered) appeal as aforesaid is made by the company itself.
2. Factually, the petitioning creditor sold, supplied and delivered certain materials in between November 9, 2001 and June 22, 2002. The company duly accepted the goods without raising any objection. After giving credit a sum of Rs. 18,96,453.20 is unpaid along with the claim of interest at 24 per cent. per annum. The company took two defences. The first one is that due to abrupt stoppage of supply the company suffered damages. In reply to the statutory notice the tune was for a sum of Rs. 50 lakhs wherein in the affidavit-in-opposition the tune was Rs. 3,50,000. The further defence of the company is that actually between July 25, 2001 and June 22, 2002, the petitioning creditor sold, supplied and delivered materials worth Rs. 73,93,423.50. After giving credit to all sums and the claim of damages a sum of Rs. 1,67,120.55 appears to be due and payable.
3. The learned judge of company jurisdiction admitted the sum of Rs. 1,67,120.55 and for the balance Rs. 17,29,332.65 relegated to the suit on the condition of furnishing bank guarantee of the said sum.
4. According to the petitioner, the learned judge should have admitted the entire sum wherein according to the company the learned judge should not have imposed any condition in relegating the dispute to a suit.
5. The petitioning creditors cited an unreported judgment being T. 317 and 318 of 2004 In re Dhariwal Steel (P.) Ltd. to establish that the court, out of mercy and its discretion, might permit full security to be furnished and thereupon relegate the petitioning creditor to a suit treating the security as security to the suit.
6. The company argued the matter separately in both the appeals. According to them, on the basis of the ratio of the judgment reported in Pradeshiya Industrial and Investment Corporation of U. P. v. North India Petro Chemical Ltd. when there is a substantial defence and not mere moonshine the dispute should be relegated to the suit. By citing another judgment reported in Ofu Lynx Ltd. v. Simon Carves India Ltd. [1971] 41 Comp Cas 174 (Cal) they contended that when the dispute is bona fide there is no question of putting condition. If the court has some doubt whether the disputes are bona fide or not and is not in a position to come to a definite conclusion that the disputes are mala fide and manufactured only to create a defence to the winding up petition, the court may stay the winding up proceeding and relegate the parties to an action on terms as to security or otherwise. This is not such a case. A further judgment is cited being ACO No. 110 of 2004 in In re S. R. C. Steel (P.) Ltd. In all, a Division Bench of this High Court held that the court of company jurisdiction would only give emphasis in admitting a winding up petition by exercising its discretionary power but not utilizing the discretion in finding out whether the nature of the company’s defence is bona fide or not.
7. We have carefully considered the strength of the arguments advanced by the contesting parties before this court. It is well known that winding up proceeding cannot be equated with a proceeding for recovery of money under any suit or in the summary proceedings like Order 12, Rule 6 or Order 37 of the Code of Civil Procedure or Chapter XIIIA of the Original Side Rules. But in the process of considering the question of civil death of a company, such dispute can be resolved. A petitioning creditor may say that as soon as a statutory notice is served giving particulars of the claim the onus is discharged and will be shifted to the company to prove their defence. According to us, in the process of ascertaining the claim in the winding up proceeding the question of shifting onus cannot be decided like the suits and summary proceedings available in the civil courts. The court will only ascertain the inconsistency of the defence to come to a definite conclusion that such defence is not substantial and mere moonshine. The question of giving security is not a new endeavour. There cannot be any bar of giving direction to put security by the company in respect of the unascertained claim. In such circumstances, the requirement of the court is to explain that although the defence may not be seen to be moonshine yet the element of suspicion cannot be eliminated. In other words, the court is not sure about the mala fide defence of the company. So far the order impugned is concerned the same cannot be said to be flawless to such extent. It is mechanical both in putting condition and not ascertaining the inconsistency of the defence particularly without splitting up the accounts i.e., damages and refund of goods with adjustment of accounts.
8. Hence, we find that there is a justiciable cause of remitting the matter back to the court of company jurisdiction to ascertain the claim and defence afresh leaving aside the admitted amount of Rs. 1,67,120.55 to which the order of the court stands affirmed. The interim order passed by the Division Bench of this High Court at interim stage also stands confirmed by this court in disposing of the appeals subject to the decision to be taken by the court of company jurisdiction preferably within the period of six weeks from the date of communication of the order.
9. Thus, both the appeals stand disposed of. However, no order is passed as to costs.
10. Xeroxed certified copies of this judgment will be supplied to the parties within seven days from the date of putting requisites for drawing up and completion of the order and certified copy of this judgment.
Pranab Kumar Deb, J.
11. I agree.