: 1 : SD IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO.909 OF 2007 COMPANY PETITION NO.909 OF 2007 COMPANY PETITION NO.909 OF 2007 Sewri Consultants Private Ltd., Mumbai ...Petitioner V/s. Sewri Engineering Construction Co. . Pvt. Ltd. ...Respondent Ms.Alpana Ghone, Advocate, i/b. DSK Legal, for the Petitioner. . Mr.Naushad Engineer, Advocate, i/b. Desai & Diwanji, for the Respondent. CORAM : ABHAY S. OKA, J. CORAM : ABHAY S. OKA, J. CORAM : ABHAY S. OKA, J. DATE : 4TH APRIL, 2008. DATE : 4TH APRIL, 2008. DATE : 4TH APRIL, 2008. P.C.: P.C.: P.C.: 1. Submissions of the learned Counsel appearing for the parties are heard. This is a petition invoking section 433 and 434 of the Companies Act, 1956. 2. The case of the petitioner is that the Sewri Engineering Construction Company Private Limited (hereinafter referred to as "the said company") is indebted to the petitioner in the sum of Rs.4,00,000/- alongwith interest at the rate of 18% p.a. The case of the petitioner in brief is that in or about January, 2006, the company approached the petitioner for temporary financial assistance in order to pay the outstanding instalments payable by the company for : 2 : purchase of a Maruti Baleno car by the said company. 3. It is alleged that the said car was purchased under an "Installment Purchase" scheme. It is alleged that since the company was unable to pay the outstanding instalments, it requested the petitioner to extend the financial assistance and accordingly the petitioner extended a loan in the sum of Rs.4,00,000/- to the said company on 10th January, 2006. The loan was to be repaid or discharged on or before 30th June, 2007. Reliance has been placed on a receipt dated 10th January, 2006 issued by the said company acknowledging receipt of a sum of Rs.4,00,000/-. The contention of the petitioner is that the said amount has also been reflected in the balance sheet of the petitioner of the year 2005 and 2006. On July 16, 2007, a notice under section 434 of the said Act of 1956 was served which was replied to on 28th July, 2007. 4. The learned Counsel appearing for the petitioner has invited my attention to the various documents annexed to the petition including the receipt in the sum of Rs.4,00,000/-. My attention has been also invited to the accounts of the petitioner for the year 2005-06. The learned Counsel appearing : 3 : for the petitioner invited my attention to some of the documents annexed to the reply filed by the said company and the contents of the rejoinder filed by the petitioner. She invited my attention to a communication dated 28th February, 2006 issued by the said company to the petitioner. She also invited my attention to the communication dated 14th March, 2006 sent by the petitioner to the said company. By inviting my attention to what is stated in the said communication it is submitted that the said company has no defence. 5. The learned Counsel appearing for the company invited my attention to various averments made in the affidavit in reply. It is submitted that the accounts maintained by the said company do not show any loan being taken and the petitioner has not been shown as a creditor. It is pointed out that the case made out by the petitioner in the Company Petition is totally in conflict to what has been stated and alleged in the statutory notice under section 434 of the said Act. It is submitted that at no point of time loan of Rs.4,00,000/- was taken. It is submitted that it is inconceivable that the respondent-company having annual turnover of Rs.317.96 lacs could have asked for a loan in the sum of Rs.4,00,000/-. It is submitted : 4 : that the petition is completely misconceived. He invited my attention to the averments made in the petition and in particular paragraphs 7 to 15 thereof. He pointed out that one Mr.S.C. Deshpande was a common Director of both the companies and with effect from 14th March, 2006 he resigned from the said company. It is pointed out that there were disputes and differences which have arisen between Mr.S.C. Deshpande and the said company. It is alleged that the present petition has been filed at the instance of said Mr.Deshpande. 6. I have considered the submissions made by the learned Counsel appearing for the parties. It will be necessary to refer to the notice issued under section 434 of the said Act. Perusal of the said notice shows that the case made out therein is completely contrary to what is alleged in the Company Petition. It will be necessary to refer to the relevant averments in the notice. My attention is invited to paragraph Nos.5 and 6 of the notice which read thus :- "5. Our client states that on or about January 2006, you approached our client requesting them for temporary financial assistance. Pursuant to your request, our clients extended an Inter Corporate Deposit ("ICD") to you ("SECCPL") of Rs.4,00,000/- (Rupees : 5 : Four Lakhs Only) on January 10, 2006. Our client states that the aforesaid ICD was to be repaid / adjusted by you on or before June 30, 2007. This repayment arrangement was agreed to between our client and yourself at the time of advancement of the ICD amount itself. Hereto attached is a copy of the receipt dated January 10, 2006, issued by you, acknowledging the receipt of sum of Rs.4,00,000/- from our clients. 6. Our client states that the time period for repayment of the ICD has expired and our clients have not received the repayment of the ICD alongwith the accrued interest." 7. Thus, the case made out is that a sum of Rs.4,00,000/- was an Inter Corporate Deposit. In the notice there is not even a whisper about the transaction relating to purchase of a Maruti Baleno car and that the said company was unable to pay the outstanding instalments payable under the instalment purchase scheme under which the Baleno car was purchased. It will be necessary to refer to what is stated in the receipt. The receipt records that the payment is on account of "advance to be repaid / adjusted on or before 30th June, 2007". In this behalf it will be necessary to refer to the relevant averments made in the affidavit in reply. It will be necessary to refer to the relevant clauses in paragraph No.4 of the affidavit-in-reply. The clauses (IV) to (X) of the said reply read thus:- : 6 : "(IV). The Petitioner had availed of the Respondent’s services for several of their clients and the Respondent had carried out the work for the Petitioner’s clients. The total value of the work performed by the Respondent during the period from the year 2003 to January 2006 was a sum of Rs.40,24,767/- (Rs.Forty Lacs Twenty Four Thousand Seven Hundred and Sixty Seven Only.) (V). The Respondent was, therefore, entitled to receive 20% of the same as the reimbursement or fee for the technical services provided by the Respondent. (VI). The Respondent also carried out various accounting work from April 2005 to December 2005 and were entitled to be reimbursed at Rs.2400/- per month which is reflected in "Exhibit A" hereto. (VII). The Respondent also carried out general administration work at Rs.10,000/- per month for the Petitioner for a period of 9 months, which is also reflected in "Exhibit A" hereto. Accordingly, an aggregate sum of Rs.9,16,553/- (Rs.Nine Lacs Sixteen Thousand Five Hundred and Fifty Three) was due and payable by the Petitioner to the Respondent. (VIII). Therefore, on 2nd January, 2006, the Respondent raised an invoice on the Petitioner for the said sum of Rs.9,16,553/- (Rs. Nine Lacs Sixteen Thousand Five Hundred and Fifty Three). A copy of the said invoice has already been annexed at "Exhibit A". (IX). The Respondent-Company had also carried out work for M/s.Bombay Corroborative Urban Design and Conservation Private Limited, which is : 7 : another Company owned by Mr.Sudhir Deshpande, who is the Managing Director of the Petitioner. The Petitioner also raised a bill dated 19th January, 2006 for a sum of Rs.1,69,268.00/- on the said M/s.Bombay Corroborative Urban Design and Conservation Private Limited. Hereto annexed and marked as "Exhibit K" is a copy of the said bill. (X). The Petitioner had on 10th January 2006 forwarded a cheque dated 11th January 2006 for a sum of Rs.4 Lacs as a part payment for the work done by the Respondent. The balance amount was to be paid or adjusted by 30th of June, 2007." 8. Thus, the case made out by the said company is that sum of Rs.4,00,000/- was paid on 10th January, 2006 by cheque dated 11th January, 2006 as a part payment for the work done by the said company and the balance amount was to be repaid or adjusted by 30th June, 2007. That is how there is a reference to advance in the receipt annexed to the Petition. The said receipt does not refer to any loan transaction. The case made out in the Petition of a loan transaction for repayment of installments of Baleno Car is not even made out in the notice under section 434. 9. Thus, in this case there is a plausible and bonafide defence available to the said company apart from the fact that the case made out in the petition : 8 : is totally contrary to what is alleged in the notice under Section 434 of the said Act of 1956. 10. Hence, there is no merit in the Petition and the same is accordingly dismissed. [ABHAY S. OKA, J.] [ABHAY S. OKA, J.] [ABHAY S. OKA, J.]