1 jpc/- IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO. 279 OF 2009 L & T. Finance Ltd. .. Petitioner Versus International Hometex Ltd. .. Respondent Ms. Shakuntala Joshi i/by S. I. Joshi & Co. for the petitioner Mr. Pardiwalla i/by M/s Mulla & Mulla for the Respondent. CORAM : S. J. KATHAWALLA, J. DATE : 26th August, 2010 P.C.: 1. By this Company Petition, the Petitioner has sought winding up of the Company viz. International Hometex Ltd. The Petition has come up for final hearing. 2. The relevant facts in the matter are as follows: 3. The Petitioner entered into an agreement of lease on 7 th March, 2007 in regard to certain plant and machinery. Under the agreement, the petitioner granted a lease finance facility in the amount of Rs.50 lacs. The Respondent undertook to pay lease rentals of Rs.33.85 per thousand aggregating to Rs.43,03,292.50 in accordance with the schedule to the lease agreement. Under the schedule the Company was liable to pay delayed payment charges of 18% per annum with monthly 2 rests. The lease period was 36 months. The Respondent fell into arrears in the payment of lease rentals. By a statutory notice dated 15 th December, 2008 under Sections 432 and 434 of the Companies Act, 1956, the Advocate for the Petitioner called upon the Respondent Company to pay a sum of Rs.39.61 lacs being overdue lease rentals of Rs.14.02 lacs; delayed payment charges of Rs.1.32 lacs and the unmatured lease rentals of Rs.24.26 lacs. There was no reply to the statutory notice. Pursuant to the Arbitration clause incorporated in the lease agreement, the Petitioner instituted arbitration proceedings. In a petition under Section 9 of the Arbitration and Conciliation Act, a learned Single Judge of this Court granted an ad interim injunction on 10th June, 2009 restraining the Company from disposing of the leased assets, which order was confirmed on 22nd July, 2009 when the Petition came to be disposed of. 4. In addition to the Arbitration proceedings, the Petitioner also filed the above Company Petition seeking winding up of the Respondent. The Respondent filed its affidavit dated 18 th June, 2009, wherein it inter alia contended : (a) that the arbitration proceedings were pending before the learned Arbitrator. (b) that there are more than 225 employees working in the plant of the Respondent Company. However the said plant is not functioning due to unavoidable circumstances and there is a 3 likelihood of re-commencing the plant activities in near future. (c) Several employees of the Respondent Company will face tremendous hardship if the Company is wound up. 5. By a detailed order dated 13 th November, 2009, this Court admitted the above Petition, inter alia holding that “Absolutely no bona fide defence has been raised in regard to the non-payment of the lease rentals. There is clearly a debt due and payable.” 6. After the Company Petition was admitted and advertised, the learned sole Arbitrator has passed his award dated 12 th January, 2010 in favour of the Petitioner and against the Respondent, inter alia directing the Respondent to pay an amount of Rs.38,43,727/- to the Petitioner as per the particulars of the claim being Exh.’F’, to the claimant’s statement of claim as on 11 th December, 2008 and further interest @ Rs.18% per annum on the said sum of Rs.38,43,727/- from 12.12.2008 till payment and/or realisation. 7. No further affidavit is filed by the Respondent after the admission of the Petition i.e. after 13 th November, 2009. The only submission made by the learned Advocate appearing for the Respondent, on instructions from the Chairman of the Respondent who is present in Court, is that the Respondent is trying to settle the matter with the Petitioner. The learned Advocate appearing for the Petitioner has submitted that though the Respondent is taking adjournments on the 4 pretext of settlement since the last two months, no attempts to settle the matter have been made by the Respondent. She, therefore, submits that no further adjournment be granted to the Respondent. 8. Apart from the fact that there is admittedly a debt due and payable by the Respondent to the Petitioner, admittedly the Company has closed down its operations since the year 2008 and has not started functioning till date. On a query raised by this Court as to whether the workers of the Company have been paid their dues, the Chairman of the Company informed the Court in the affirmative. However, when the Court inquired whether the workers have been paid till date, he informed the Court that they are paid till February/March, 2010. When this Court further inquired whether all the workers were paid upto February/March, 2010, the Court was informed in the negative. Thus it is apparent that the Chairman is brazenly making false statements in response to the queries raised by the Court. 9. Under the circumstances, in my view, if any further time is given to the Respondent, the workers as well as the creditors of the Company, more particularly, the unsecured creditors will suffer further loss since the amount by way of interest qua the claims of the secured creditors will keep on mounting and the machinery of the Company which is not used since the last about 2/3 years will only fetch scrap value. Under the circumstances, the company petition is made absolute in terms of prayer clauses (a) and (b)., which are reproduced hereunder: 5 “(a) That the said Respondent Company International Hometex Limited, a company registered under the Companies Act, 1956, having its registered office at 401, Sumer Kendra, P.B. Marg, Worli, Mumbai 400 018 be wound up by an order and under the directions of this Hon’ble Court under the Provisions of the Companies Act, 1956; (b) That the Official Liquidator of High Court, Bombay be appointed as Liquidator of the said Company for all its assets, properties, bank accounts and book debts with necessary powers under the provisions of the Companies act, 1956;” 10. Until the liquidator takes possession of the properties and assets of the Company, the Respondent Company and its directors are restrained from in any manner parting with possession, alienating, transferring selling or encumbering or creating third party rights on any of the assets and properties of the Respondent Company or any part thereof. 11. Company petition is disposed of with no order as to costs. 12. Learned Advocate Mr. Pardiwalla seeks stay of the order for a period of 12 weeks. The application is rejected. (S. J. KATHAWALLA, J.)