1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO.49 OF 2010 Master Marine Services Pvt. Ltd. ....Petitioner V/s. Orient Shipping Agency Pvt. Ltd. ....Respondent Mr.Vivek Kantawala with Ms.Sneha Nanadkar i/b Vivek Kantawala & Co. for the Petitioner. Mr.Vishal Kanade with Ms.Vidhi Parikh i/b Kartikeya & Associates for the Respondent. CORAM : S.J. VAZIFDAR, J. DATE : 29TH JUNE, 2010. P.C. :- 1. This is a petition for winding up the Respondent Company on the ground that it is unable to pay its debts. According to the Petitioner, the company is indebted to it in the sum of Rs.4,88,379=51 ps. together with interest at 18% p.a. from 23.9.2009 till payment. 2. The claim arises on account of the professional activities carried out by the Petitioner for the Respondent company of survey, tally and supervision of cargo/containers discharged from various vessels at Mumbai and other ancillary activities for various containers to be exported from Mumbai. The Respondent is primarily a shipping agency. In paragraph 6 of the petition, it is averred that the Petitioner carried out the activities on the basis of mutually agreed terms and conditions for the Respondent throughout the year. 2 3. Mr.Kanade, the learned counsel appearing on behalf of the company stated that the Petitioner has been unable to produce any written agreement between the Respondent and itself in respect of the said services. The Petitioner has contended in one of its e-mail messages that its records were destroyed in a fire that broke out in its office. I will however, presume that the contract is not only not traceable but that no contract in writing was executed. In the facts of this case, it would make no difference, as I will presently demonstrate. 4. There is no dispute that the Petitioner rendered the said services. Nor is there any dispute that the Petitioner forwarded to the Respondent several invoices addressed expressly to the Respondent. The Respondent contended however, that the invoices were to be paid by the Respondent’s foreign principal. In other words, according to him, the Respondent was only an agent of the foreign party and that there was no principal to principal transaction between the Petitioner and itself. According to the Respondent its role in the present transaction was limited to merely forwarding the bills received from the Petitioner to the foreign party for which the Respondent received no consideration. It is difficult to accept this statement. (A). The Petitioner admittedly forwarded seven bills between 19.2.2008 and 7.7.2008. Each of these invoices, as stated earlier, is raised on the Respondent. By an e-mail message dated 25.7.2008, addressed to the Respondent, the Petitioner stated that the Respondent’s officer had insisted on a copy of the contract with the Respondent which was more 3 than three years old ; that the contract had been lost in a fire that gutted the office and that in proof of the same, the Petitioner relied upon the police station report. The Petitioner made a grievance that the Respondent had failed to make payment of the outstanding amount of more than Rs. 5,00,000/-. It is even more important to note that the Petitioner stated that an on account payment of Rs.2,25,000/- was made. (B). It is of vital importance to note that there was no reply to this e- mail message. It was not contended by the company that it was not bound or liable to make the payment of the invoices and that it is only the foreign party that was bound and liable to make the said payment. Nor is there any explanation for having made a part payment of Rs.2,25,000/-. If indeed the Respondent’s defence was true, the normal response would have been an immediate denial of liability on that ground. 5(A). The Petitioner thereafter addressed four e-mail messages to the Respondent on 17.1.2009, 19.1.2009, 19.1.2009 and 3.2.2009 stating that the Petitioner had been informed by the Respondent’s officers that the Respondent had decided to change the surveyor in the Mumbai port and that the Petitioner’s service stood terminated. The Petitioner stated that this was entirely the Respondent’s decision but that its dues amounting to Rs.4,34,000/- ought to be paid. (B). The Respondent did not state that it was not liable to make payment. (C). By an e-mail message dated 19.1.2009, the Petitioner once again requested the Respondent to settle the dues. By a further e-mail dated 19.1.2009, the Petitioner raised a grievance that it had tried 4 contacting the executive of the Respondent regarding the payment but without success. By an e-mail message dated 3.2.2009, the Petitioner once again referred to the outstanding dues of about Rs.5,00,000/- and requested the Respondent to pay the same. The Petitioner forwarded an attachment to the e-mail message being a statement of the outstandings. 6. Mr.Kanade however, relied upon an e-mail message contending that the Petitioner had itself accepted that the liability was not that of the Respondent but of the foreign party. 7. I do not agree. The correspondence correctly construed, indicates clearly that the Petitioner merely requested the foreign party to make payment which was actually due from the Respondent. This is evident from the following correspondence. By an e-mail message dated 20.4.2009 sent to the foreign party, the Petitioner attached the statement of amounts due to it “from M/s.Orient Ship (Respondent) a/c NSCSA (foreign party)”. This was really a complaint by the Petitioner to the foreign party, as they were the foreign principals of the Respondent. That the foreign party was the principal of the Respondent, does not necessarily lead to the conclusion that the Respondent acted as an agent between the foreign party and the Petitioner in respect of the services for which the invoices were raised. Looking to the facts and circumstances of the present case, prima-facie the Petitioner had rendered the services on a principal to principal basis qua the Respondent albeit for the benefit of the foreign party. There was not even a whisper at the material time that this was not so. 8. It is also clear from the further e-mail message of the Petitioner 5 where it merely stated that it was the foreign parties “moral and ethical objects” to pay the dues of the Respondent. It is not even suggested that it was the legal liability of the foreign party to do so. It is for this reason that in the e-mail message, the Petitioner did not demand the amount from the foreign party but requested it to make payment of the Respondent’s dues. 9. By a further e-mail message dated 24.4.2009, addressed to the foreign party, the Petitioner stated that it was willing to provide all the details of the invoices that had been raised on the Respondent only for the survey work for the foreign party. The Petitioner also stated that it attended the vessels of the foreign party “for O.S.A.” . 10. The foreign party in fact by an e-mail message dated 4.5.2009 informed the Petitioner that it does not have any sort of agreement with the Petitioner and that it had not asked the Petitioner to do any work. It is important to note that a copy of this e-mail message was also sent to the Respondent. There is nothing on record which indicates that the Respondent wrote back or responded in any manner stating that the transaction was between the Petitioner and the foreign party. If indeed the Respondent was not liable to make the said payment, it would have immediately responded stating that it is the foreign party that must make payment and that it acted only as an agent without assuming any liability for the dues. This is an important factor which militates against the Respondent’s contention. 11. The doubt, if any, in this regard is set rest by the fact that there is no reply to the statutory notice dated 23.9.2009. This is despite the fact that there was adequate time, four months, for the Respondent to deny its 6 liability on the above basis as the petition was filed only on 27.1.2010. 12. In the result therefore, it is admitted that the Petitioner carried out the said work. It is admitted that the Petitioner raised the said invoices. There is no dispute as to the rate mentioned and the invoices. There is no dispute as to the quality of the work. The only dispute is that the Respondent acted as an agent without any consideration. 13. Mr.Kanade submitted that the Respondent derived no benefit from the transaction. He stated that the Respondent did the work without any remuneration from its foreign principal. 14. It is impossible to believe this case. There is nothing to indicate why the Respondent acted in the matter without any consideration. There is no special relationship indicated between the Respondent and the foreign principal. This is not the normal course of the business. 15. Mr.Kanade’s reliance upon the judgment of a learned single Judge of this Court in the case of Midland Overseas v. m.v. “CMBT Tana” , 1999, Bombay, 401, is of no assistance to the Respondent in view of the fact that the transaction in the present case was on principal to principal basis between the Petitioner and the Respondent. 16. In the circumstances :- i). The Company is directed to deposit in this Court a sum of Rs.5,00,000/- on or before 31.8.2010. ii). Upon the amount being deposited, the same shall be invested in a nationalized bank initially for a period of one year and hereafter for like periods of one year each. iii). In the event of the amount being so deposited and in the 7 event of the Petitioner filing a suit within twelve weeks from the date of the Petitioner's advocate being informed of the same in writing, the amount shall stand transferred to the credit of such suit. iv). In the event of the suit not being filed as aforesaid, the petition shall stand dismissed and the amount with interest thereon shall be refunded to the Respondent – Company. v). In case of failure on the part of the Company to deposit the amount as aforesaid, the Petition shall stand admitted and to be advertised in Free Press Journal, Maharashtra Times and Maharashtra Government Gazette. The Petitioner to deposit an amount of Rs. 10,000/- with the Prothonotary and Senior Master of this Court within four weeks from the date of default. Mr.Kanade waives service on behalf of the Respondent.