2019 NearLaw (DelhiHC) Online 149
Delhi High Court

JUSTICE JAYANT NATH

M/S IN-FER INDIA Vs. M/S B.A.G FILMS AND MEDIA LTD.

CO.PET. 57/2012

10th January 2019

Petitioner Counsel: Mr. V.K. Shukla Mr. B.R. Pandey
Respondent Counsel: Mr. Abhishek Malhotra

The Architect of the respondent company Innovation Architect and Interior Designers approved the bill of Rs79,87,515/- and issued an appropriate certificate.
As the respondent in the counter affidavit doubted the authenticity of the work certificate issued by the Architect, this court on 4.4.2014 directed the personal presence of the Architect.
In case the said amount of Rs79,87,515/- with simple interest @ 6% per annum from the date of the statutory legal notice dated 22.9.2011 till date of payment is paid within the said period of four weeks the aforesaid order appointing the Official Liquidator as the PL shall stand recalled.
List on 30.4.2019.

Cases Cited :
Para 11: IBA Health (I) Pvt. Ltd. Vs. Info-Drive Systems Sdn.Bhd., (2010) (4) CompLJ 481 (SC)

JUDGEMENT

JAYANT NATH, J.

1. This petition is filed under section 433(e) read with section 434 and 439 of the Companies Act, 1956. The case of the petitioner is that the petitioner firm was awarded work order by the respondent on 22.10.2007 for carrying out the additional work for studio for B.A.G. Films and Media Limited at Noida for an amount of Rs.77,28,027/-. The petitioner states that they have completed the entire work to the satisfaction of the respondent and invoices for Rs.80,46,429.48/- were raised. The Architect of the respondent company Innovation Architect and Interior Designers approved the bill of Rs.79,87,515/- and issued an appropriate certificate. It is stated that despite the approval, verification and certification of the bill by the approved Architect of the respondent company necessary payment has not been made. On 22.9.2011 statutory legal notice was served on the respondent company but there was no response.

2. Respondents have filed their reply. In the reply they have completely denied all the contents of the petition. In addition, it is pleaded that there was an earlier work order dated 11.6.2007 which was issued to the petitioner details of which very conveniently have been kept out from the petition. It is pleaded that the entire work was contained in the said work order and there was no occasion for them to have issued another work order for additional work on 20.11.2007. It is further pleaded that the work was incomplete of the first work order and hence there was no payment due. There is no acknowledgement by the respondent. Hence, no winding up order can be passed against the respondent company.

3. I have heard learned counsel for the parties.

4. Learned counsel for the respondent has reiterated the contentions spelt out in the counter-affidavit as noted above.

5. I may note that on 22.10.2007 the respondent has placed an additional work order based on the quotation of the petitioner for a sum totalling Rs.77,28,027/-. Subsequently, the summary of the work done and the invoices raised/final bill was certified by the Architect. Final bill is dated 22.7.2008. The Architect has, however, reduced the amount claimed by the petitioner and acknowledged a sum of Rs.79,87,515 towards the dues of the petitioner.

6. As the respondent in the counter affidavit doubted the authenticity of the work certificate issued by the Architect, this court on 4.4.2014 directed the personal presence of the Architect. On 10.10.2014 Mr.Ashish Jindal partner of M/s. Innovation Architects & Interior Designs appeared in person in court. He stated that the final bill dated 22.7.2008 has been verified by him and certified and he stated that the additions and alterations in the final bill annexed with the company petition as Annexure 4 are in his own handwriting and that the bills in respect of the project were certified by him.

7. The Architect is appointed by the respondent. It follows from the certificate given by the Architect that the Architect was duly satisfied about the work done by the petitioner. Respondents have falsely and mischievously sought to deny the certificate given by their own Architect.

8. The other argument which has been raised by the respondent pertains to an earlier work order dated 11.6.2007. The plea is that this work order does not find mention in the present winding up petition but the petitioner accepts the same in the rejoinder he has filed. It is pleaded that this work order was the main work order and there were several defects in the work of the petitioner and hence no amount is payable to the petitioner.

9. In my opinion, the above contention is entirely misplaced. The petitioner's work orders dated 22.10.2007 and 11.06.2007 have both been duly issued by the respondents. They contain details of the work which was to be done. The work done by the respondents are duly spelt out in Annexure A attached to the work orders dated 22.10.2007 and the details are also attached to the final bill. The respondents are needlessly trying to create confusion by mixing up two work orders. That apart, reference may also be had to some of the communications which have been filed by the respondent alongwith counter-affidavit. Copy of email dated 7.11.2007 has been filed which states that cove lights are not to be installed with LED lights instead the items which was approved in the tender be used. It also talks about 60 points (60Amps) teleport room (IV floor) for TV head end is required. Similarly, the communication dated 6.11.2007 lists out the urgent requirement and works which are to be done. A third communication dated 28.12.2007 where some complaint is made about work of first floor. In response, on the very same date the petitioner has stated that the first floor is virtually ready.

10. It is clear that these are minor glitches that may have arisen while execution of the work. In fact these glitches appear to pertain to first contract dated 11.06.2007. That apart, there is nothing on record to show that the petitioner did not finally complete the work or that the respondent had to get the defective work corrected from some third contractor. It is clear that the defence raised by the respondent is not bona fide.

11. Reference in this context may be had to the judgement of the Supreme Court in IBA Health (I) Pvt. Ltd. vs. Info-Drive Systems Sdn.Bhd., (2010) (4) CompLJ 481 (SC) where the Supreme Court held as follows:-

“17. The question that arises for consideration is that when there is a substantial dispute as to liability, can a creditor prefer an application for winding-up for discharge of that liability? In such a situation, is there not a duty on the Company Court to examine whether the company has a genuine dispute to the claimed debt? A dispute would be substantial and genuine if it is bona fide and not spurious, speculative, illusory or misconceived. The Company Court, at that stage, is not expected to hold a full trial of the matter. It must decide whether the grounds appear to be substantial. The grounds of dispute, of course, must not consist of some ingenious mask invented to deprive a creditor of a just and honest entitlement and must not be a mere wrangle. It is settled law that if the creditor's debt is bona fide disputed on substantial grounds, the court should dismiss the petition and leave the creditor first to establish his claim in an action, lest there is danger of abuse of winding-up procedure. The Company Court always retains the discretion, but a party to a dispute should not be allowed to use the threat of winding-up petition as a means of forcing the company to pay a bona fide disputed debt.”

12. The facts show that the defence raised by the respondents lacks bona fide and cannot be accepted.

13. Accordingly, I admit the present petition. The Official Liquidator attached to this Court is appointed as the Provisional Liquidator. He is directed to take over all the assets, books of accounts and records of the respondent-company forthwith. The citations be published in the Delhi editions of the newspapers 'Statesman' (English) and 'Veer Arjun' (Hindi), as well as in the Delhi Gazette, at least 14 days prior to the next date of hearing.

14. Petitioner shall deposit a sum Rs.75,000/- towards cost of the publication with the Official Liquidator within 2 weeks, subject to any further amounts that may be called for by the liquidator for this purpose, if required. The Official Liquidator shall also endeavour to prepare a complete inventory of all the assets of the respondent-company when the same are taken over; and the premises in which they are kept shall be sealed by him. At the same time, he may also seek the assistance of a valuer to value all assets to facilitate the process of winding up. It will also be open to the Official Liquidator to seek police help in the discharge of his duties, if he considers it appropriate to do so. The Official Liquidator to take all further steps that may be necessary in this regard to protect the premises and assets of the respondent-company. The OL will also seize all the bank accounts of the respondent.

15. However, I suspend the above order appointing the Official Liquidator as the Provisional Liquidator for a period of four weeks to enable the respondent to pay the dues of the respondents. In case the said amount of Rs.79,87,515/- with simple interest @ 6% per annum from the date of the statutory legal notice dated 22.9.2011 till date of payment is paid within the said period of four weeks the aforesaid order appointing the Official Liquidator as the PL shall stand recalled.

16. List on 30.4.2019.