Case Note & Summary
The dispute arose from a Special Leave Petition filed by the petitioner against a judgment and order of the Bombay High Court dated 19th July 2007, which dismissed the winding up petition filed by the petitioner against the respondent company. The petitioner claimed to be a Holder in Due Course of two Bills of Exchange dated 15th December 2002, which were endorsed in its favor on 28th January 2003 and were payable on 15th March 2003. The respondent company opposed the petition, asserting that no payment was due because two credit notes were issued confirming the return of goods supplied. The Bills of Exchange were not presented for payment for two years after maturity, and subsequent notices demanding payment were issued but did not lead to further proceedings. The learned Company Judge dismissed the winding up petition, a decision that was upheld by the Division Bench of the High Court. The Supreme Court, upon hearing the arguments, agreed with the reasoning of the High Court, emphasizing that the dispute warranted resolution in a properly constituted suit rather than through winding up proceedings. Consequently, the Special Leave Petition was dismissed, but the court clarified that the petitioner could pursue its remedy in another forum as per law.
Headnote
A) Company Law - Winding Up Petition - Dismissal of Winding Up Petition - Companies Act, 1956, Section Not mentioned - The petitioner sought winding up of the respondent company based on two Bills of Exchange but the respondent raised a genuine dispute regarding payment due to credit notes issued for returned goods. The court upheld the dismissal of the winding up petition, indicating that the matter should be resolved in a properly constituted suit due to the contentious nature of the objections raised (Paras 2-4).
Issue of Consideration
Whether the petitioner, as a Holder in Due Course, was entitled to wind up the respondent company based on the Bills of Exchange.
Final Decision
The Supreme Court dismissed the Special Leave Petition, affirming the dismissal of the winding up petition and indicating that the matter should be resolved in a properly constituted suit.
Law Points
- Holder in Due Course
- Winding Up
- Bills of Exchange
- Company Petition
- Genuine Dispute
