Case: In Re: Modern Dekor Painting Contracts Private Limited and Modern Dekor Painting Contracts Private Limited Vs. Jenson and Nicholson Limited and Another

( 2 ) A few facts necessary for the determination of the question in this appeal are that the said company Petition No. 221 of 1977 was preferred by the petitioning creditors, Jenson and nicholson (India) Ltd. for winding up of the company on the ground that Modern Dekor Painting contracts Pvt. Ltd. (hereinafter referred to as the company), was unable to pay its debts as and when they became due. It appears that the said petition was accepted and on December 5, 1977, the petition was placed on board for admission. The company appeared on an intimation having been received from the petitioning creditors advocate that the petition would be placed on board for admission. The company also opposed the admission of the petition by filing an affidavit. However, on December 5, 1982, (sic) an order was passed as follows :in the event of the respondent company depositing in court a sum of Rs. 50,000 (Rupees fifty thousand) within twelve weeks from today, the petition to stand dismissed. If such deposit is made, then : (a) the companys advocates to forthwith intimate to the prothonotary and senior master and the petitioners advocates the fact of such deposit, (b) the petitioner to be at liberty to file a suit orm in the appropriate court for recovery of the amount in petition due to the petitioner, such suit orm to be filed within eight weeks of the date of intimation that such deposit has been made, (c) the amount of such deposit to stand credited to the said suit or, as the case may be, (d) the prothonotary and senior master to invest the amount so deposited under the directions of the court. (e) If no such suit orm is file by the petitioner within the said period, the company to be at liberty to withdraw the amount deposited. In the event of the company failing to deposit the said amount within the said period, the petition do stand admitted and be advertised in the Maharashtra Govt. Gazette, Indian Express and Mumbai Samachar. The petition to come up for hearing four weeks after the date of the advertisement.( 3 ) TWELVE weeks time for making the deposit expired on March 5, 1978, and the company failed to make the requisite deposit. Nothing happened during the period of nearly two years and one month and it was for the first time on April 24, 1980, that an application was made on a precise to the prothonotary and senior master of this court for issuance of a certificate of. Pursuant to the said application, the prothonotary and senior master issued a certificate oft on March 26, 1981, i. e. , nearly eleven months after the application. After obtaining the said certificate, the petitioning creditors, though their advocates submitted a draft of advertisement to the prothonotary and senior master for fixing a date of hearing. On May 22, 1981, the advertisement was published in the Bombay Samachar, on June 4, 1981, in Indian express and on June 4, 1981, in the Official Gazette. On June 18, 1981, the petitioning creditors advocates submitted a precipe to the prothonotary and senior master for placing the winding up petition on board on June 24, 1981. Accordingly, on June 24, 1981, the petition for winding up was placed on board. On that day, the company was absent and an ex parte order for winding up of the company was passed. On July 15, 1981, a representative of the official liquidator went to the residential premises of Jehangir Homi Gora, a director of the company, and it was only then that the company became aware of the winding up order. Thereafter, on July 24, 1981, the company took out a judges summons being Company Application No. 204 of 1981 for setting aside the said ex parte order of winding up( 4 ) THE judges summons was heard on January 27, 1982, and the same was dismissed for the reasons stated in the order. Against the said order, the company has preferred this appeal.

Reasoning:
( 7 ) IT is difficult to accept the submission of Shri Tulzapurkar. It must at first be stated that there is no provision in the Companies (Court) Rules, 1959, or in any other rules for acceptance of a winding up petition, but a practice has developed in this court of placing a winding up petition before the court for acceptance and this practice and procedure which is a long standing practice and procedure has been saved by r. 6 of the Companies (Court) Rules, 1959, Rule 6 provides :save as provided by the Act or by these rules, the practice and procedure of the court and the provisions of the Code so far as applicable, shall apply to all proceedings under the Act and these rules. The Registrar may decline to accept any document which is presented otherwise than in accordance with these rules or the practice and procedure of the court.( 15 ) IT is also difficult to accept the submission of Shri Tulzapurkar that rr. 27, 28, 29 and 31 do not apply to ap petition. Rule 28 of the Companies (Court) Rules, 1959, is as under : 28. Service on company.(1) Where a petition is presented against a company, it shall be accompanied by a notice of the petition in the prescribed form together with a copy of the petition for service on the company and an envelope addressed to the company at its registered office or its principal place of business and sufficiently stamped for being sent by registered post for acknowledgment. The Registrar shall immediately on the admission of the petition send the notice together with the copy of the petition to the company by registered post. (2) Every petition and, save as otherwise provided by these Rules or by an order of court, every application shall, unless presented by the company, be served on the company at its registered office, or, if there is no registered office, at its principal or last known principal place of business, by leaving a copy thereof with an officer or employee of the company and in case no such person is available, in such manner, as the judge or Registrar may direct or by sending a copy thereof by prepaid registered post addressed to the company at its registered office, or if there is no registered office, at its principal or last known principal place of business, or to such person and at such address as the judge or Registrar may direct. Where the company is being wound up, the petition or application shall also be served on the liquidator, if any, appointed for the purpose ofp the affairs of the company.It is also difficult to accept this submission of Shri Tulzapurkar. The opening words of r. 28 (1) are where a petition is presented against a company and the opening words of. (2) of r. 28 are every petition. Therefore, neither inp petition excepted. A plain reading of r. 28 shows that it is applicable to every petition filed against a company and it admits of no exception. Furthermore, the language or r. 28 shows that the service of notice upon the company is mandatory. The words every petition. . . every application shall, unless presented by the company be served on the company are not merely directory but also mandatory. Reading rr. 27 and 28 together, the prescribed form referred to in r. 28 is Form No. 6 which is prescribed by r. 27The effect is as directed in r. 31 of the Companies (Court) Rules, viz. , that the petition will have to be posted for orders for dismissal of the petition or to pass such order as the court may deems fit( 24 ) SINCE the notice of thep petition was not served upon the company, the appeal will have to be allowed and the order dated January 27, 1982, dismissing the judges summons, viz. , Company Application No. 204 of 1981, will have to be set aside.