S.D.AGARWALA, J. - (1.) THIS is a petition for winding up Pream Spinning and Weaving Mills Co. Ltd., hereinafter referred to as ' the company ', under Section 439 of the Companies Act, 1956. The'Companies Act, 1956, shall hereinafter be referred to as 'the Act'. The petitioner, Paramjit Lal Badhwar, was secretary -cum -manager of the company since 1969 up to January 16, 1981. The petitioner was in -charge of the day -to -day working of the company. After he ceased to be the secretary of the company, the present petition was filed on February 25, 1981.
(2.) ORIGINALLY , the registered office of the company was situated at Ujhani, District Budaun, but now the office has shifted to Ambala Road, Saharanpur. The total number of issued and subscribed shares of the companyare 26,215 of Rs. 60 each. The company was incorporated in the year 1921 and started manufacturing cotton yarn from 1923 and continued to manufacture cotton yarn till December, 1973. In 1973, the spinning section of the company was burnt out, resulting in heavy loss and, ultimately, the mill was closed in May, 1976. The damage caused by the fire was so great that, ultimately, it had to be closed down as stated above. The company also installed a straw board unit in 1965 but the factory could not be started till 1971. This factory is also alleged to have been closed in 1977. The allegation consequently is that both the spinning mill as well as the straw board factory of the company have closed down. Thereafter, steps were taken to sell the straw board unit and on December 6, 1978, a resolution was passed in the extraordinary general meeting of the shareholders authorising Lala Janak Raj, who is one of the directors of the company, to take necessary steps for effecting closure and negotiating with the prospective buyers in respect of both the units and the proposal to be put up before the board for its consideration and approval. Proceedings were thereafter taken for sale of the straw board unit. On December 9, 1980, in the meeting of the board of directors of the company, it was resolved that an offer of 24 lakh rupees from G. T. Oil Mills. Ujhani, be accepted. It was further resolved that Lala Janak Raj, director, be authorised to issue letters of acceptance to receive payment and execute registration of the sale deed. After this resolution was passed on December 9, 1980, accepting the offer of G.T. Oil Mills, Ujhani, in regard to th'e sale of straw board unit of the company, the real dispute between the parties arose and, as such, the present petition has been filed in this court on February 25, 1981, and an ad interim order was issued restraining the directors from selling the property of the company till further orders. The petition has been based, inter alia, on the ground that the working in the spinning mill and the straw board factory was stopped since 1976 and 1977, respectively. The company has also declared permanent closure of the spinning mill with effect from July 15, 1979, and, as such, the company was liable to be wound up under Section 433(e) of the Act.
(3.) IT has further been alleged that the company is unable to pay the salary and other dues amounting to Rs. 29,786 to the petitioner within three weeks of the notice of demand issued to the company on January 6, 1981, and, as such, the company was liable to be wound up under Section 433(e) of the Act. It has further been alleged that the company has become commercially insolvent and that the substratum of the company has gone and, as such, it is just and equitable that the company should be wound up.;