JUDGMENT
Usha Mehra, J.
1. M/s. Jyoti Limited filed a petition under Sections 433(e), 434 and 439
of the Indian Companies Act, 1956 (in short the Act) seeking winding up order against M/s. International Pumps and Projects Ltd., inter alia, on
the ground that the respondent is indebted and has not paid the debt due to the petitioner.
2. That facts as alleged in the petition are that the respondent placed a purchase order on the petitioner pertaining to the specified Switch Board
vide letter dated 10th July, 1995. The transaction emanated from agreement for the Kharagpur Augmentation Water Supply Scheme belonging to Public Health Engineering Department, Government of West Bengal Undertaking at Keshpal Augmentation Water Supply Scheme Pumping Station, Midnapore, West Bengal. The petitioner had also asked for Mobilisation Advance of 10% but no reply was given by the respondent. According to the petitioner,
respondent’s order was kept in abeyance for want of required clarification regarding terms of payment. Request of the respondent to make payment by post-dated cheque was declined by the petitioner. Petitioner was surprised when the respondent informed to defer the manufacturing of panel. The goods
manufactured by the petitioner were inspected by the Inspecting Team of the respondent and the goods were found in order. The material was despatched on 15th June, 1997. Thereafter revised sight draft incorporating invoice/G.C. number was sent to the respondent for his acceptance and co-acceptance of his bank. But the sight draft was not accepted by the respondents bankers. Documents were, therefore, discounted by the bankers of the petitioner. Respondent did not release payment inspite of reminders. That the respondent had no intention to pay for the switch gears. Thus, the amount due from the respondent as claimed by the petitioner works out to Rs. 49,08,800/- towards price of the switch gears. Respondent by letter dated 9th January, 1998 admitted its liability. Petitioner filed a writ petition in Calcutta High Court. The same was dismissed being between private parties. Legal notice demanding payment of the debt due was served
but inspite of that no payment made, hence the petition.
3. On the basis of the averments made in this petition, notice was issued to the respondent. In the meantime, respondent was restrained from transferring, alienating, encumbering or parting with possession of the assets of the respondent Company.
4. That on the receipt of the restrain orders, the respondent filed this application alleging therein that the petitioner has concealed material facts and mis-represented before this Court. Alleged concealed facts as per the petitioner are: (i) that the petitioner and the respondent were having business dealings. They were doing business in many ways in respect of various related items. (ii) That the respondent had to receive a sum of Rs. 11,56,271.55 paise from the petitioner on account of business dealing which the respondent had with the petitioner. (iii) That the petitioner concealed
and mis-represented about the decision of the Calcutta High Court by virtue of which its writ petition was dismissed. Petitioner has alleged that his petition was dismissed on the ground that the dispute was inter se the private parties. Whereas in fact vide order dated 9th April, 1998 petitioner’s petition was dismissed thereby specifically holding that the petition raises dispute of civil nature in relation to their respective obligations, hence civil suit was the proper remedy. In view of these observation, the petitioner ought not to have filed the present petition.
Since there existed disputed questions of fact which cannot be gone into under the Act, hence petition was not maintainable. (iv) Petitioner concealed the factum of his preferring a criminal complaint against the Managing
Director of the respondent wherein he stated the facts which are contrary to the one stated herein. (v) That factum of negotiation started in July, 1998 and the settlement arrived at between the petitioner and the respondent has been concealed. That pursuance to the negotiation a meeting was held at Vodadara on 24th August, 1998 where settlement was arrived at.
5. That as per the said settlement, respondent Company agreed to pay a sum of Rs. 22.81 lakhs in full and final settlement of the claims of the petitioner Company in respect of the purchase order pertaining to Switch Gears. As part performance of the said agreement, the respondent Company paid a sum of Rs. 12.81 lakhs to the petitioner Company against receipt dated 29th August, 1998. The amount was paid by demand draft No. 727549 dated 28th August, 1998, which was duly accepted by the petitioner. The first instalment as per the said agreement was due and payable on 5th
September, 1998, however, the respondent Company paid the amount in advance on 28th August, 1998 thereby complying the terms of the said agreement. It was the term of that agreement that after receipt of the first instalment the petitioner would give ‘C’ Form and ST-1 Forms to the respondent. The petitioner was to call another meeting for resolving the alternator manufacturing and marketing agreement and the amount payable to the respondent on account of PHED, Jodhpur was to be quantified. The petitioner Company by suppressing of all these facts filed this petition.
6. Notice of this application was served on the petitioner through Counsel. Heard Dr. A.M. Singhvi, Senior Advocate for the petitioner and Mr. Sanjiv Behl for the respondent/applicant.
7. That perusal of this petition shows the petitioner had concealed and suppressed material facts, namely: (i) that the Calcutta High Court dismissed his writ petition vide order dated 9th April, 1998 holding that it being a dispute of civil nature between the parties writ petition was not maintainable. (ii) The filing of the criminal complaint has also not been mentioned in the petition. (iii) The more important aspect of the case is that of the settlement arrived at between the parties which was as a consequence to the meeting held on 24th August, 1998 at Vodadara. As per the said settlement, it was agreed between the parties that if the respondent pays a sum of Rs. 22.81 lakhs it would be in full and final ettlement of petitioner’s claim qua the supply of these switch gears. This fact has not even been whispered in the petition. The petition was filed on 27th August, 1998, by which time, settlement had already been arrived at. It was incumbent on the petitioner to disclose the factum of that settlement but the petitioner by concealing the same misled the Court in order to obtain discretionary relief of interim injunction. The petitioner has already obtained discretionary relief in its favour by concealing the factum of settlement. It was not only that some settlement was arrived at but the said agreement was in fact acted upon when respondent paid a sum of Rs.12.81 lakhs to the petitioner Company against receipt dated 29th August, 1998. The first instalment as per the agreement amounting to Rs. 12.81 lakhs was to be paid by 5th September, 1998. However, the respondent instead of waiting till 5th September, 1999 paid the first instalment on 29th August, 1998 which was duly accepted by the petitioner herein. This petitioner instead of waiting till 5th September i.e. the last date of payment of the first instalment filed this petition on 27th August, 1998. The case came up before this Court on 9th September, 1998 by which date the petitioner had already received the amount of Rs. 12.81 lakhs from the respondent Company pursuance to the said agreement. This fact was not brought to the notice of this Court on 9th September, 1998 when the case came up for the first time. From the above facts, it is clear that the petitioner Company has intentionally suppressed the above said material facts and misrepresented before this Court in order to obtain favourable orders.
8. The contention of Dr. A.M. Singhvi that non-mentioning of the factum of settlement was due to communication gap. It was not an intentional suppression of material facts. The error crept in because of communication gap and lack of proper instructions. The fact that there was settlement due to error could not be mentioned. As regards implementation of the said settlement whereby petitioner received Rs. 12.81 lakhs, that amount had not been received when the petition was filed. I find no force in these submissions of Dr. Singhvi. The factum of settlement was a very material fact in the circumstances of this case. The said settlement envisaged payment of Rs. 22.81 lakhs in full and final settlement of the claim of this petitioner of having supplied switch gear in respect of purchase order dated 10 July, 1995. The first instalment of Rs. 12.81 lakhs was to be paid by the respondent by 5th September, 1998. This fact itself was very material to
determine the liability and debt position of the respondent under Section 433(e) of the Act. The petitioner, however, in the petition has alleged that the respondent owe it a sum of Rs. 58,66,016/- as on 17th August, 1998 beside interest. Thus according to this petition, the respondent was indebted to the tune of Rs. 58,66,016/-. Whereas per the agreement which had been concealed the respondent was to pay in all a sum of Rs. 22.81 lakhs. Out of which the respondent did pay the first instalment of Rs. 12.81 lakhs much before 5th September, 1998 i.e. much before the first date of hearing. Thus it is apparent that the debt was not Rs. 58,66,016/- as alleged in the petition. It is not possible to accept the argument of Dr. Singhvi that mention of settlement was omitted due to communication gap. It cannot be said mere omission or an error or that there was a communication gap. The petitioner has tried to mislead this Court by suppressing material facts. The petition is, therefore, liable to be dismissed. The Company Petition is accordingly dismissed with costs of Rs. 5,000/-.