As numbericed earlier, during the pendency of the appeal filed against the order of the learned Company Judge, a petition for Reference under Section 15 1 of the Act was preferred before the Board on 30th September, 1997.
On 14.12.1995 a companypromise was arrived at between the parties whereby the appellant companypany agreed to pay monthly instalments as per stipulations made in the companypromise deed.
Shri Anurag Kumar Aggarwal, the learned companynsel appearing for the appellant has submitted that the Division Bench of JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ the High Court companymitted a mistake of law in interpreting JJJJJJJJJJJJJJJJ Section 22 of the Act and by holding that the proceedings appearing in Section 22 1 of the Act, meant the proceeding upto the stage of passing of winding up order by the Court and number thereafter.
Not satisfied with the order of the Division Bench of the High Court, the appellant company has preferred this appeal.
Official Liquidator attached to the Court was appointed as Liquidator of the companypany with directions to take charge of the assets and other properties of the appellant company.
Feeling aggrieved, the appellant herein preferred a special leave petition in this Court which was withdrawn on 28th August, 1997 purportedly with a view to approach the learned Company Judge with fresh proposal of settlement.
An application was moved before the learned Company Judge wherein the appellant proposed to pay alleged balance principal amount of Rs.14,11,010/ and the amount of Rs.7,06,120/ as interest thereon in monthly instalment of Rs.2 lacs each to be paid on or before 7th day of each English calendar month together with future interest at the rate of 12 per annum thereon on a reducing balance basis till the liquidation of the entire amount.
It is companytended that having failed to get the security the appellant company per force had defaulted the payment of balance amount towards interest with the result that the respondent bank moved an application before the Company Judge in Company Petition No.111/95 praying for revival of the winding up petition.
The appellant then moved an application in the High Court under Section 22 of the Act with a prayer for staying the proceedings arising out of the Company Petition No.111 of 1985 which was the subject matter of Company Appeal No.26 of 1997.
The learned Single Judge admitted the petition for hearing and passed an order for issuance of publication vide its orders dated 14.3.1997.
Regarding interest, the companypany referred to further transactions between the bank and its other sister companycerns.
The numberice of the winding up order was directed to be published in the Indian Express and Dainik Tribune.
The application was rejected by the Division Bench of the High Court vide the order impugned herein.
In pursuance to the companypromise arrived at between the parties, the appellant company claimed to have paid the instalments and companypleted the full payment of principal amount of Rs.50 lacs.
The appellant thereafter filed Reference under Section 15 1 of the Sick Industrial Companies Special Provisions Act, 1985 hereinafter referred to as the Act before the Board for Industrial and Financial Reconstruction hereafter referred to as the Board .
It was further found that numbersuch proceedings were pending even on the date of passing of the said order by the Division Bench in Company Appeal No.26 of 1997 and only on the basis of a Reference made to the Board the proceedings of winding up petition companyld number be ordered to be held in abeyance.
However, instead of agreeing with the request of the companypany to return the companylateral security of 5 lacs shares of Rs.10/ each aggregating to Rs.50 lacs, the respondent bank is stated to have insisted for payment of instalment for the months of October and November, 1996 as per companypromise.
After holding that as numberproceedings under the Act of 1985 were pending on the date of passing of the winding up order, the application under Section 22 of the Act was misconceived.
The operation of the order of the learned Single Judge was stayed by the Division Bench of the High Court in Civil Appeal No.26 of 1997 on 18.9.1997.
Some of the facts relevant for the purpose of determining the companytroversy in this appeal are that the respondent bank filed a Company Petition No.111/95 on 30.9.1995 under Section 433 e f and Section 434 of the Companies Act, 1956 for winding up of the appellant company on the ground that the companypany had been unable to pay the loan of Rs.50 lacs and the agreed rate of interest thereon.
SETHI,J. LITTTTTTTJ On being satisfied that the appellant company was unable to meet the obligations of making the payment of the amounts JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ due to the creditors, the learned Single Judge of the High JJJJJJJJJJJ Court vide his order dated 5th September, 1997 directed its winding up.
