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M/S C.R. Foods India Pvt. Ltd. v. M/S R.M. Foods Pvt. Ltd. - COMPANY PETITION No. 14 of 2002  RD-AH 19269 (15 November 2006)
Court No. 30
COMPANY PETITION NO. 14 OF 2002
M/S C.R. Foods India Pvt. Ltd.
1/301-A, Nawab Ganj, Kanpur and
Principal Office at 6/16, Gali Barahbhai,
Belanganj, Agra - Petitioner-company
M/S R.M. Foods Pvt. Ltd., 1/301-A,
Nawab Ganj, Kanpur- Respondent-company
Hon'ble Sunil Ambwani, J.
1. Heard Shri J. Nagar, learned counsel for the petitioner-company and Shri Piyush Agarwal learned counsel for respondent-company.
2. This creditor's winding up petition has been filed for non-payment of money for the supplies of raw material ''maida' used by the respondent-company in manufacture of bread. The company petition has been filed after giving a demand notice dated 19.12.2001 under Sections 433 and 434 of the Companies Act 1956 stating therein that as on 28.6.1999, there was balance of Rs. 24, 93, 250.75 paise and that further supplies were made of the value of Rs. 9, 57, 431.12 paise till 24.8.1999. The respondent-company paid Rs. 12, 05, 979.78 paise which was duly credited and net balance as on 29.2.2000 along with interest was Rs. 38, 53,166.64 paise. After adjusting payment of Rs. 12,05,979.78 paise, the outstanding balance could be Rs. 26, 47, 286.86. The parties then settled the amount at Rs. 22.5 lacs and agreed the amount to be paid upto 10.7.2001 out of which only Rs. 6 lacs paid on 9.10.2000. The rest has not been paid. On the date of notice, an amount of Rs. 28, 17, 758.45 paise was due.
3. The company petition was admitted on 26.2.2003. The order of publication was, however, stayed on the application of respondent company.
4. In the counter affidavit filed by respondent company, the liability has not been denied. A vague reply has been given in paras 29 and 30 stating therein that sub quality material was supplied. The date, on which such protest was made, has not been given nor the goods were returned. The issue was not raised when respondent company settled the dues of Rs. 22, 85, 000/-. It is now stated in para 34 that the deponent was compelled and made to accept the whims and to enter into an agreement. The manner in which the coercion was exercised is not given in the pleading.
5. Further, it is not denied in the counter affidavit that eight monthly instalments, i.e. seven monthly instalments of Rs. 2 lacs each and eighth and last instalment of Rs. 50,000/- agreed to be paid under the settlement reached on 9.10.2000, were not paid by the respondent-company. They had agreed that in the event of default 21% interest to be paid per annum.
6. Shri Piyush Agarwal has relied upon the balance sheet of the year 31.3.2001, which demonstrates that the company is carrying on manufacturing activities. The balance sheet shows that the company was in loss of Rs. 10,61,194.18 paise as on 31.3.2001. It was indebted with the secured and unsecured creditors for Rs. 1, 17, 26, 930.55 paise as against its fixed assets of Rs. 19, 99, 667/-. It is stated that the company made marginal profits of Rs. 9, 38, 680.33 in the provisional profits and loss accounts for the period 31.12.2003. After adding profit and loss account, it was still in losses of more than Rs. 9 lacs. From these accounts, it is clear that the company is unable to pay its dues.
7. The company has failed to pay its admitted liability and has failed to comply with the settlement with the petitioner. It is incurring regular losses. In the facts and circumstances, the petitioner has made out a case for winding up the respondent company.
8. The citation under Rule 24 of the Companies (Court) Rules 1959 was published in daily news papers ''Pioneer' dated 13.3.2003, ''Dainik Jagaran' dated 16.3.2003 and in the official gazette dated 15.3.2003. No one has filed any representation.
9. Shri Piyush Agarwal, learned counsel for the respondent-company submits that the company has paid Rs. 57.96 lacs to UPFC and Indian Oversees Bank against their secured loan in the financial year 2002-03. Taking into account the liability of Rs. 98, 95, 830.55 paise disclosed in the balance sheet towards secured creditors, it is not clear as to whether this amount is paid towards the principal or interest. The balance sheet as on 31.3.2002 shows an increase of liability towards secured loan of Rs. 1,00,58,949.34.
10. In the facts and circumstances, the respondent company is found to be commercially insolvent and is unable to pay its admitted dues.
11. The winding up petition is allowed. The respondent-company is directed to be wound up. The Official Liquidator is appointed as liquidator of the company. He will take over assets of the company and serve notice to Ex Directors to file statement of affairs and proceed to liquidate the company in accordance with the law.
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