High Court of Judicature at Allahabad
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Amforge Industries Ltd v. Lml Ltd - COMPANY PETITION No. 26 of 2005  RD-AH 16277 (19 September 2006)
Court No. 30
COMPANY PETITION NO. 26 OF 2005
Amforge Industries Limited Petitioner-company
L.M.L. Limited Respondent-company
Hon'ble Sunil Ambwani, J.
1. During the course of these winding up proceedings, an agreement was struck between the parties upon a revised offer given by the respondent-company and accepted by the petitioner-company on 12.1.2006 to pay Rs. 52.43 lacs in 24 monthly instalments. There was some delay in payment of instalment which was condoned on 17.4.2006. On 7.7.2006, the Court observed as follows;
"The court is concerned here with the agreement entered into between the parties. There is no submission on record that respondent-company has no money to pay the instalment. In fact in para 12, the respondent-company again reiterated that it is willing to adhere the undertaking given by it on 12.1.2006 and is ready to make the payment and due to circumstances stated in the application, there is delay in making the payment."
2. On 21.7.2006, the Court rejected the plea of the respondent-company that due to lock out the respondent-company may be permitted to deposit only Rs. 50,000/- per month and agreed to pay entire defaulted instalments due to be paid by 10.8.2006.
3. On 17.8.2006, the demand drafts of Rs. 2, 85, 000/- and 2, 83, 000/- were handed over to the petitioner-company. The respondent-company was granted four week's time for making the remaining instalments good.
4. Today by an application supported by affidavit of Shri A.K. Bajpai, Manager (Law) of the respondent-company, the court is informed that a reference under Section 15 (1) of the Sick Industrial Companies (Special Provisions) Act 1985 has been registered by the Registrar of the Board of Industrial and Financial Reconstruction on 15.9.2006. It is contended that Section 22 (1) of the Act of 1985 has come into play and taking into account Rishab Agro Industries Ltd. vs. P.N.B. Capital Services Ltd. (2000) 5 SCC 515, the winding up proceedings may be stayed.
5. Shri R.P. Agarwal appearing for the petitioner-company submits that the agreement entered into the parties in court or a consent decree accepted by the court amounts to an undertaking given to the Court to pay the amount and that the proceedings for enforcement of such undertaking which also amounts to civil contempt under Section 2 (B) of the contempt of the Court Act 1971 are not to be stayed under Section 22 (1) of the Act. Shri R.P. Agarwal also relies upon para 12 of the affidavit dated 7.7.2006, in which the respondent-company had clearly understood the agreement and its liability as an undertaking and had so recorded in the affidavit filed by it in Court.
6. The parties pray for short adjournment for detail hearing in the matter as to whether these proceedings can continue inspite of the bar under Section 22 (1) of the Act. List on 11.10.2006.
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