1 913A.cp-312-10 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION jmi COMPANY PETITION NO. 312 OF 2010. SBI Global Factors Limited. ..Petitioner. vs. Tanaaya Gems & Jewellery Exports Limited. ..Respondent. .... Mr. Chirag Balsara, a/w. Mr. Rajesh Talekar, i/b. K. Ashar & Co., for Petitioner. None for Respondent. .... CORAM : S.J. KATHAWALLA, J. DATE : 24TH JUNE 2011. P.C. : This Company Petition is for hearing and final disposal. 2. The Petition was admitted on 10th December 2010. The claim of the Petitioner against the Respondent Company is for a sum of Rs. 14,81,12,364.80. 3. The Petitioner is a wholly owned subsidiary of State Bank of India. By a letter of sanction dated 12th June 2007 issued by the Petitioner, the Respondents were sanctioned a trade finance facility for an amount of Rs. 15 crores. The Respondent Company accepted the terms and conditions of the said letter of sanction dated 12th June 2007 by passing a Board Resolution dated 14th June 2007 and forwarding the said Resolution to the Petitioner. 4. In order to secure the repayment of monies to be advanced 2 913A.cp-312-10 under the said trade finance facility, the Respondent Company, inter alia executed (1) a global account receivable management agreement dated 19th June 2007, (2) promissory note for an amount of Rs. 5 crores repayable with interest at 12.5% per annum with monthly rests and (3) demand promissory note for USD 24,40,000/-. 5. The Respondent Company availed of the said trade finance facility and acknowledged its liability in correspondence as shown in its letters dated 22nd January 2009 (Exhibit KK to the Petition), 29th January 2009 (Exhibit LL to the Petition), 28th March 2009 (Exhibit MM to the Petition), 2nd April 2009 (Exhibit NN to the Petition), 29th April 2009 (Exhibit OO to the Petition), 17th August 2009 (Exhibit RR to the Petition) and 16th September 2009 (Exhibit SS to the Petition). 6. The Petitioners issued a statutory notice dated 5th May 2010 to the Company calling upon the Company to pay the outstanding amount within a period of 21 days failing which the Petitioner would initiate winding up proceedings under the provisions of sections 433 and 434 of the Companies Act, 1956. The Company has by its letter dated 14th June 2010 replied to the aforesaid notice and made a denial of the aforesaid amount of Rs. 13,19,40,421.24 claimed by the Petitioner. 7. The Petitioner has in paragraph 51 of the Company Petition expressly stated that the cheques issued by the Company to the Petitioner towards part payment of the Petitioner’s dues have been dishonoured upon presentation and the Petitioner was constrained to file a complaint under section 142 read with section 138 of the Negotiable Instruments Act. 3 913A.cp-312-10 8. The Company did not appear at the stage of admission as also at the stage of final hearing despite notice having been advertised in “Free Press Journal” and “Maharashtra Times” by the Petitioner as well as in the Government Gazette. 9. The Petitioner has filed an Affidavit dated 9th March 2011 of one Shri Rajkumar Dalvi placing on record the aforesaid advertisements in newspapers and the Gazette. This Office has also issued notice under Rule 28 of the Companies (Court) Rules, 1959. 10. The Company has by its letter dated 29th April 2009 (Exhibit OO to the Petition), clearly admitted its liability for a specific amount of Rs. 16,36,45,206.30. It is seen from the correspondence exchanged between the parties that the Company has repeatedly acknowledged its liability and sought extension of time to pay the same. However, the Company has committed a sudden volte face while replying to the statutory notice. The denial of the amount claimed by the Petitioner in the statutory notice appears to be totally bald and without substance. The Company has in fact not filed any reply to the Company Petition. 11. In addition to the Petitioner’s claim of Rs.14,81,12,364.80, the Company has defaulted in payment of its dues to SICOM Limited who have filed Company Petition No. 778 of 2009. 12. In the circumstances, it is absolutely clear that the Company is unable to meet its liabilities in the day to day course of its business and it would be prejudicial to the public if the Company is allowed to function. The Company is hopelessly indebted to its creditors and does not have funds to run its business. 4 913A.cp-312-10 13. Under the circumstances, the Company Petition is allowed in terms of prayer clauses (a) and (b) above. The Official Liquidator who has been appointed Liquidator of the Company in Company Petition No. 778 of 2009 vide order dated 5th March 2010 shall continue for the purpose of winding up of the affairs of the Company. [ S.J. KATHAWALLA, J. ]