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L&t Finance Ltd V Nissan Copper Ltd[ Guj]

March 6, 2014
Co. Pet. No. 214/2012 Companies Act, 1956- sections 433 & 434 Petitioner(s) L & T FINANCE LTD.... V/S Respondent(s) NISSAN COPPER LTD.... Brief Facts:

The Respondent Company availed loan facility to the tune of Rs 3 crore. The respondent Company did not made any payment to the Petitioner Company nor gave any response to the statutory notice issued by the Petitioner. The court while hearing the winding up petition passed an order admitting the petition but subject to the petitioner removing the defects in the affidavits filed in support of the petition. The petitioner did not remove the defects within the time granted by the court. The respondent Company sought to dismiss the petition on this technical ground.

Decision: Petition Admitted Reason:
  1. Section 433 and 434 of the Companies Act, inter alia provides that if a Company is unable to pay debts, the Company should be wound up.

  2. Under Section 434, if after service of statutory notice at the registered office of the Company debtor neglects to pay the same, it will be deemed that the Company is unable to pay its debts.

  3. In the present petition except the technical plea that there is some breach of the Companies(Court) Rules, 1959, there is no denial by the Respondent Company to the demand raised by the Petitioner.

  4. The order passed earlier in this petition, Court had provided that if the respondent does not make the payment and/ or does not finalize arrangement similar to CDR with the petitioner, the petition will automatically stand admitted.

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