A.K.Banerji, J. - (1.) By means of this petition filed under sections 433(e), 434(1)(a) and section 439 of the Companies Act, 1956 ('the Act') Chaudhary Attar Singh (the petitioner) has prayed for winding up of the company Subash Oil Mills (P.) Ltd. having its registered office at National Highway, Chhata, Mathura (the respondent-company) on the ground that the said respondent is indebted to the petitioner and has not been able to pay its debts despite the service of the statutory notice.
(2.) On notice being issued to the respondent-company to show cause why this petition may not be admitted and advertised, appearance has been put by the respondent which has also filed a counter affidavit, wherein, the respondent has not seriously disputed that it is indebted to the petitioner but has stated that on account of financial constrain the payment could not be made. It has also been stated that the factory of the respondent is lying closed since long and the expenditure is amounting, consequently, the company is unable to pay the amount due immediately and shall try to pay at its earliest. It has also been admitted that presently, the company is not able to pay its due. On 11-7-1997, this Court, after hearing the counsel for the parties, and on a perusal of the affidavit filed by them, was prima facie of the view that a case for admitting this petition and for advertising the same under rule 24 of the Companies (Court) Rules, 1959 was made out. However, as the publication of the advertisement would have serious consequences on the business of the respondent, the Court directed that the publication of the advertisement shall remain stayed provided the respondent deposits the entire sum claimed by the petitioner alongwith the interest by means of a Bank Draft, within two months in two equal instalments. Admittedly, the said order was not complied with. The respondent sought further time to comply with the said order which was granted. Despite the extension of time, the dues could not be deposited by the respondent-company, consequently, on 15-9-1997, this Court directed that the petition be advertised under rule 24. The said petition has now been duly advertised as reported by the office.
(3.) I have heard Shri A.B. Saran, the learned senior counsel appearing for the petitioner. Shri Krishna Murari, the learned counsel appearing for the respondent has stated that his client is not responding and consequently, he has no further instructions. As already noticed above, the company, in the counter affidavit, had not disputed its liability to pay the amount claimed by the petitioner. It has also candidly admitted that it was not in a position to pay its debts on account of the financial crunch. Despite, the Court having granted time to the respondent-company to pay the admitted dues in two instalments it has failed to pay. Under the circumstances, . it is evident that the company is unable to pay its debts. It will not in the benefit of the company or the public at large to keep the company alive when otherwise it is not in a position-to pay its debts. Admittedly, its factory is lying closed since long and no scheme has been presented before this Court by which, the respondent-company proposed to rehabilitate itself. The Court is, therefore, of the view that this petition deserves to be allowed.;