M.Y.EQBAL, J. - (1.) THESE two appeals arose out of the common order dated 10.9.1996 passed in a Company Petition No. 5 of 1995 (R) whereby learned Single Judge allowed the Company Petition and directed for winding up of the appellant Company M/s. Date Cables Limited. Since common question of law and facts are involved in these two appeals, the same are disposed of by this common order.
(2.) RESPONDENT DCM Shriram Consolidated having its registered office at New Delhi filed a petition under Sections 433(e)(f), 434 and 439 of the Companies Act. 1956 against the appellant M/s. Date Cables Limited for winding up of the appellant Company M/s. Date Cables Ltd. on the ground inter alia for non -payment of dues and also on the ground that the company became insolvent and it has become indebted to various creditors. In the said Company Petition, appellant State Bank of India was made proforma respondent. The case of the petitioner respondent DCM Shriram Consolidated Ltd. (in short DCM) was that the appellant M/s. Date Cables Ltd. was established for manufacture of all types of PVC. XLPE and rubber insulated cables. The said company was said to be indebted to the petitioner for a sum of Rs. 18,89,548/ -. The said Date Cables placed order on the petitioners Company for supply of various items of PVC in 1993. The terms of the payment offered were through letter of credit of Rs. 13 lacs through its bank. It was alleged that although components were supplied but payment was delayed and the period of letter of credit was expired. Petitioner sent its representative several times but payment was not made and the bank of the respondent Company asked the petitioner to deal the matter directly with the Company. The petitioner therefore believed and there was reason to believe that the appellant Company became insolvent and heavily indebted and there was no scope of getting payment consequently Company Petition was filed. Learned Single Judge after hearing counsel appearing for the two companies allowed the application and passed an order for winding up of the appellant Company namely, M/s. Date Cables Limited.
(3.) MR . Kameshwar Prasad, learned senior counsel for the appellant State Bank of India in LPA No. 282/97(R) assailed the impugned order of the learned Single Judge as being illegal and wholly without jurisdiction. Learned counsel firstly submitted that all the secured creditors of a company must be heard before passing winding up order of that company. Learned counsel submitted that the appellant State Bank of India was made party respondent in the Company petition because of the fact that the bank was one of the biggest creditors of the respondent Date Cables Limited as all the bills of M/s. Date Gables Ltd. being routed -through bank under letter of credit. Learned counsel then submitted that M/s. Date Cables Limited became habitual defaulter of the bank and accordingly appellant -Bank instituted Mortgage Title Suit No. 65/95 against M/s. Date Cables Limited and decree was passed in 1995 in favour of the Bank for a sum of Rs. 7,57,57,697.68 paise and after passing of the said preliminary mortgage decree the appellant Bank applied for preparation of a final decree which is pending before the Court. Learned counsel further submitted that although the Company Petitioner namely, DCM Shriram Consolidated Ltd. was aware that the appellant Bank is one of the major creditor of the Date Cables Ltd. and accordingly it had arrayed the appellant Bank has party respondent. Despite the above fact the winding up order was passed without giving any notice or opportunity of hearing to the appellant -Bank. We find much force in the submission of Mr. Kameshwar Prasad, learned Senior Counsel appearing for the appellant -Bank.;