Allowed

Tondupu Sathyanarayana v. Viswam Agro Genetics Pvt.Ltd

Telangana HC20 Apr 2010CP/21/2008

Case brief

AI extract

What is this about?

The single judge allowed a company petition for the winding up of Viswam Agro Genetics Private Limited. The court found the company commercially insolvent based on its failure to pay due amounts on maturity and its reply to a statutory notice asserting inability to pay debts.

What did the court decide?

Order for winding up of the respondent company; notice to Official Liquidator; service of order on Managing Director; advertisement in newspapers; deposit of initial expenses.

Tondupu Sathyanarayana Vs Viswam Agro Genetics Pvt.Ltd — Company and Corporate | Telangana HC (2010)

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THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY

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Company Petition No.21 of 2008

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Dated:2 0 th April, 2010

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Between:

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1. Tondupu Satyanarayana & Ors.

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….Petitioners

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AND

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Viswam Agro Genetics Private Limited, rep. by its Managing Director Mr.Majeti Papa Rao.

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…Respondent

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¶11

THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY

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Company Petition No.21 of 2008

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ORDER:

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This Company Petition has been taken out under Sections 433(3) & (f) and 439(b) & [c] of the Companies Act, 1956 (for short, ‘the Act’) r/w. Rule 95 of the Companies (Court) Rules, 1959 (for short, ‘the Rules’), seeking a direction for winding up of Viswam Agro Genetics Private Limited-respondent Company since it has become commercially insolvent.

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2. Notice before admission came to be ordered on 31.03.2008. The petitioners were permitted to take out notice to the respondent Company by registered post with acknowledgment due and to file proof of service. Despite notice being served on the respondent Company, it did not choose to enter appearance to resist the application. The Company Petition came to be admitted on 01.05.2008 and the petitioners were directed to take out publication in NEW INDIAN EXPRESS (English daily newspaper) and ANDHRA

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JYOTHI (Telugu daily newspaper) in Guntur and Prakasam (Ongole) Editions, fixing the date of hearing as 26.08.2008. The petitioners took out notice of publication and filed proof of publication. Despite notice being taken out by way of publication, the respondent Company did not choose to enter appearance to resist the company petition.

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3. On behalf of the petitioners, one witness was examined as PW.1 and 14 documents were marked as Exs.A1 to A14.

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4. Heard learned counsel appearing for the petitioners and perused the evidence of PW.1 and Exs.A1 to A14.

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5. Learned counsel appearing for the petitioners submits that the respondent issued reply to the statutory notice expressing its inability to pay the debt and that itself is sufficient to infer that the respondent Company has become commercially insolvent.

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6. The respondent Company was incorporated as Viswam Agro Genetic Private Limited on 17.04.1995 under Certificate of Incorporation No.01-19998 of 1995 issued by the Registrar of Companies, Hyderabad, A.P. The registered office of the respondent Company is situated at 25-18-4, Sampath Nagar, Guntur – 522 004. The authorized share capital of the respondent Company is Rs.10,00,000/- divided into 10,000 equity shares of Rs.100/- each. The main objects of the respondent Company are to carry on the business of breeders and farmers of Sheep, Goat and all kinds of other cattle, livestock, plants, fruits etc. The petitioners purchased 16 units from the respondent Company at the rate of Rs.3,501/- for each unit. The respondent Company assured the petitioners to pay Rs.50,006/for each unit on maturity. The units held by the petitioners are as follows:

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1) Tondupu Satyanarayana One unit

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2) Alavala Subhashini One unit

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3) Kothamasu Leela Kumar One unit

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4) Chunduru Lakshmi Kumari Two units

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5) Saranam Naga Satyavathi Six units

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6) Saranam Durga Prasad Two units

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7) Saranam Kishore Kumar Two units 8) Tadikonda Santha Devi One unit

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On the units being matured, the petitioners demanded the respondent Company to pay the maturity value of the units. As the respondent Company failed to comply the demand, the petitioners issued a statutory notice, under Sections 433 and 434 of the Act, dated 18.09.2007, to the respondent Company. The respondent Company issued a reply dated 11.10.2007. The relevant portion of the reply

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notice reads as hereunder:

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“….My client is not in a position to pay the amounts as demanded by you in your notice dated 18.09.2007 and further please advise your clients not to take any steps against my client for recovery of dues and in spite of this if your clients want to proceed further that shall be at your clients risk and costs and consequences thereof.”

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Hence, this Company Petition by the petitioners seeking the relief stated supra.

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7. PW.1 is the 8^th petitioner. He is the power of attorney holder of the other petitioners. Ex.A1 is the power of attorney dated 18.10.2006 executed by Tondupu Satyanarayana and others in favour of PW.1. Ex.A2 is the certificate of incorporation of the respondent Company. Exs.A3 to A11 are the unit holder certificates in the names of the petitioners. Evidence of PW.1 is explicit that the petitioners purchased 16 units from the respondent Company on assurance that the respondent Company will give maturity value of Rs.50,006/- for each unit. Exs.A3 to A11 are the unit holder certificates issued by the respondent Company. Ex.A12 is the statutory notice under which the petitioners demanded the respondent Company to pay the amounts due under the unit holder certificates issued by the respondent Company. Ex.A13 is the reply notice issued by the respondent Company. Evidence of PW.1 coupled with the Exs.A1 to A13 amply prove that the respondent Company has become commercially insolvent, thereby renders itself for its winding up.

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8. Accordingly, the Company Petition is allowed with costs. Notice of the order for the winding up of the respondent Company shall be sent forthwith to the Official Liquidator in Form No.50 under Rule 109 of the Rules, enclosing a copy of the petition and affidavit filed in support of the petition. Pursuant to Rule 114, the Official Liquidator shall forth with take into his custody under his control all the properties and effects and books and papers of the respondent Company and shall take necessary steps for that purpose. The order for winding up shall be drawn up in Form No.52 and two certified copies thereof shall be sent as per Rule 111 to the Official Liquidator. The Official Liquidator shall cause a sealed copy of the order served on the company as required by sub-rule (2) of Rule 111 and also serve true copy of the order on the Managing Director of the Company by prepaid registered post. The order for winding up of the company shall be advertised by the petitioners in form No.53 in INDIAN EXPRESS (English daily newspaper) and ANDHRA JYOTHI (Telugu daily newspaper) in Guntur and Prakasam (Ongole) Editions, within fourteen days. The petitioners shall deposit a sum of Rs.25,000/- with the Official Liquidator towards initial expenses within four weeks.

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______________________ B.SESHASAYANA REDDY, J.

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Date: 20^th April, 2010.

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Note: Issue C.C. within a week. B/O cs

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THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY

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Company Petition No.21 of 2008

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Dated:2 0 th April, 2010

Tondupu Sathyanarayana v. Viswam Agro Genetics Pvt.Ltd

Case brief

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What did the court decide?

Tondupu Sathyanarayana v. Viswam Agro Genetics Pvt.Ltd

Case brief

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What the court decided

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