ASN 1 Appeal-241.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL LODGING NO.241 OF 2011 IN COMPANY PETITION NO.384 OF 2010 Game King Pvt. Ltd. ..Appellant. Vs. Mrs. Pooja M.Cahurasia. ..Respondent. Mr. Anil Singh with Mr. D.R.Shah for the Appellant. Mr.K.H. Halai with Priya Agarwal i/by Halai & Co. for the Respondent. CORAM : MOHIT S. SHAH, C. J. AND GIRISH S. GODBOLE, J. Friday 6 th May, 2011 PC: This appeal is directed against the judgment dated 31st March 2011 by the learned Company Judge in winding up petition bearing Company Petition No.384 of 2010. 2 The appellant company admitted that the respondent (petitioning creditor) had granted loans to the company and by confirmation of the accounts dated 1st April, 2008 for the financial year 2007-08, the appellant admitted that the total outstanding amount as on 1st April, 2008 was Rs.11,24,250/- due and payable towards the principal amount. Interest was claimed by the petitioning creditor for the first time by a notice dated 24th December, 2008 at 18% per annum. By the impugned order, the learned Company Judge has determined the rate of ASN 2 Appeal-241.sxw interest at 12% p. a. and on that basis worked out the liability of the appellant company at Rs.15,00,000/-. The appellant has been granted time to pay the said amount of Rs.15,00,000/- in 15- equal monthly instalments failing which the company petition stands admitted. 3 Learned counsel for the appellant company is not in a position to dispute the admission made in the confirmation dated 1st April, 2008 that the principal amount due and payable as on that date was Rs.11,24,250/-.The dispute is mainly about the rate of interest. 4 At the hearing, learned counsel for the appellant submitted that there was no agreement for payment of interest and therefore the learned Company Judge has erred in determining the rate of interest at 12% p.a. On the other hand, learned counsel for the petitioning creditor supported the order of the learned Company Judge. 5 Having heard the learned counsel for the parties, we are of the view that in the peculiar facts and circumstances of the case, the interest of justice would be served if rate of interest is fixed at 10% per annum and interest can be claimed not from 1st April, 2008 but from the subsequent date of notice of demand. The learned Trial Judge while passing the impugned order fixed the rate of future interest at 10% per annum on reducing balance. In view of the above, the appeal is partly allowed and the appellant company is held liable to pay the principal amount of Rs.11,24,250/- as on 1st April, 2008 with liability to pay interest at 10% per annum with effect from 24th December, 2008 (i.e. ASN 3 Appeal-241.sxw Date of demand notice). So calculated the amount due on the date of order of Single Judge will come to Rs.14,00,000/- as agreed by the parties. 6 In the circumstances, the appeal is disposed of in terms of the following order : (i) In the event of the Company paying sum of Rs.14,00,000/- in 14-equal instalments as stated hereinafter, winding up petition being Company Petition No.384 of 2010 shall stand dismissed. (ii) In view of the above, learned counsel for the respondent petitioning creditor states that if the appellant company pays the above principal amount of Rs.11,24,250/- along with interest at 10% p.a. (totalling Rs.14,00,000/-) as on 31st March 2011 and future interest 10% per annum, the petitioning creditor will not institute any proceedings against the appellant and will accept the said amount of principal and interest in full and final settlement of the claim of the petitioning creditor against the appellant company. The principal amount along with interest as aforesaid shall be paid in equal monthly instalments of Rs1,00,000/- each commencing from 15th May, 2011 till the entire amount payable as aforesaid along with interest is paid by the appellant company to the petitioning creditor. The interest shall be calculated on the reducing balance. The subsequent instalments shall be paid on or before 15th day of each succeeding month. The amount of each instalment so paid shall be applied first towards the interest and thereafter to the principal ASN 4 Appeal-241.sxw amount. 8 In case of failure on the part of the company to pay the aforesaid amount, the winding up petition shall stand admitted and shall be advertised in Free Press Journal, Maharashtra Time and Maharashtra Government Gazette. In that event, petitioning creditor shall deposit Rs. 10,000/- with the Company Registrar, High Court Bombay within four weeks from the date of default. 9 The appeal is accordingly allowed with the aforesaid order. CHIEF JUSTICE GIRISH S. GODBOLE, J.