MARKETING AND ADVERTISING ASSOCIATES PVT LTD Vs. TELERAD PRIVATE LTD

JUDGEMENT

(1.) The petitioners have filed this petition for winding-up the applicant-company, and the petition was accepted in the ordinary course and the usual direction for notice to the company was given. When the petition came up for admission on 24th April, 1968, and for directions in regard to advertisement, the parties arrived at certain consent terms, a copy of which has been annexed to the affidavit filed in support of the present summons and marked "A". Under the said consent terms, the company agreed to pay to the petitioners an aggregate sum of Rs. 1,50,000 by certain instalments which were payable on the 30th day of each month. A consent order was passed by the court in accordance with those terms. It may be stated that, under the said consent terms, an installment of Rs. 25,000 became payable on or before the 30th of August, 1968. The actual amount due to the petitioners was, under the said consent terms, left to be decided either by agreement, or by reference to the arbitration of counsel Mr. A. B. Diwan. Clauses 4 and 5 of the consent terms were in the following terms :

(2.) The company duly paid to the petitioners the instalments provided for in the consent terms up to and inclusive of the 30th of July, 1968, aggregating to Rs. 1,10.000. As far as the instalment of Rs. 25,000 which fell due on the 30th of August, 1968, was concerned, the company forwarded to the petitioners their cheque for the said sum on that very day, but the same was dishonoured on presentation for payment by the petitioners. It is the case of the applicant-company on the present summons that they came to know of the dishonour of the said cheque on the 5th of September, 1968, and that the same was dishonoured "due to inadvertence" in certain circumstances which have been set out by the company in paragraph 5 of the affidavit in support of the present summons. It is stated in the said paragraph that the applicant company had two accounts in the Central Bank of India Ltd., which were called account No. 1 and account No. 2, respectively, that the said cheque was drawn by the company on account No. 1, that on the 31st of August, 1968, the company desired to transfer a sum of Rs. 20,000 from account No. 2 to account No. 1, that if that transfer was effected there would have been a sufficient balance in account No. 1 to honour the cheque in favour of the petitioners, but that "due to oversight and inadvertence" the cheque which was intended to be drawn on account No. 2 for the purpose of effecting the said transfer was drawn on account No. 1 and that it was under those circumstances that the company's cheque in favour of the petitioners was dishonoured by the non-payment. The company has stated in the affidavit in support of this summons that, as soon as they discovered this on the 5th of September, 1968, they offered to send a pay slip to their bankers for the sum of Rs. 25,000 to the petitioners which, however, the petitioners declined to accept. It is under those circumstances that the applicant-company has taken out the present judge's summons for condonation of the delay or default in payment of the said instalment of Rs. 25,000 which was payable on the 30th of August, 1968, and for extension of time for payment of the same to such date as the court may deem fit. In fact, the applicant-company has, in the course of the hearing of this summons, offered to hand over to the petitioners not only the said pay-slip for Rs. 25,000, but also the balance of Rs. 15,000 which has not yet fallen due and which, under the consent terms, was payable on the 30th of September, 1968, by another pay-slip which they had with them ready in court and which would complete the payment of the entire amount of Rs. 1,50,000 provided for in the consent terms. That offer was also declined by Mr. Cooper on behalf of the petitioners.

(3.) In support of the summons, Mr. Nariman, for the applicant-company, has relied on rule 7 of the Companies (Court) Rules, 1959, which is in the following terms :