Winding up plea to be transferred to NCLT when no further order was passed by Court after admission of plea

Case Details: Parmanand Vijaykumar v. Samshi Pipe Industries Ltd. - [2022] 135 taxmann.com 227 (Gujarat)[10-12-2021]

Judiciary and Counsel Details

• • Bhargav D. Karia, J.
  • Viral K. Shah for the Petitioner.

Facts of the Case

In the instant case, a petition was filed u/s 433 for winding up of the respondent-Company as it had failed to pay debt of the petitioner under sections 433, 434, and 439 of the Companies Act, 1956.

The Court admitted the matter, and directed that the admission of the petition shall be advertised in two newspapers. The Court appointed the Official Liquidator and directed him to take over the charge and possession of the assets of the respondent company and do other incidental acts. The hearing of the application adjourned from time to time basis due to one or another reason.

The Petitioner’s advocate submitted that sufficient efforts were made to resolve the disputes between the petitioner and the respondent-Company but the same has failed and further submitted that in view of the decision of the Apex Court in case of Action Ispat & Power (P.) Ltd. v. Shyam Metalics & Energy Ltd, the proceedings of the company petition are required to be transferred to the National Company Law Tribunal (NCLT).

High court further observed that as no actual sales of the immovable or movable properties have taken place. Therefore nothing irreversible is done which would stop Court to transfer the Winding up petition to NCLT.

It is only where the winding-up proceedings have reached a stage where it would be irreversible, making it impossible to set the clock back that the Company Court must proceed with the winding up, instead of transferring the proceedings to the NCLT.

High Court Held

High Court observed that in the current case it appears that after the order of admission, advertisement of the petition, and appointment of a provisional liquidator, no further orders were passed by the Court with regard to the order of winding up of the company. Therefore the petition for winding up can be transferred to the NCLT.

In view of the above High court ordered to transfer the Winding up petition to the National Company Law Tribunal, Ahmedabad Bench.

Further as the petition was transferred therefore the Official Liquidator Report does not survive and stands disposed of accordingly.

Case Review

• • Action Ispat & Power (P.) Ltd. v. Shyam Metalics & Energy Ltd. [2020] 122 taxmann.com 147/[2021] 164 SCL 375 (SC) (para 9) followed.

List of Cases Referred to

• • Action Ispat & Power (P.) Ltd. v. Shyam Metalics & Energy Ltd. [2020] 122 taxmann.com 147/[2021] 164 SCL 375 (SC) (para 9).

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