Meghalaya High Court: Sanjib Banerjee, CJ, addressed a petition wherein a creditor’s winding-up petition was instituted under Section 433 of the Companies Act, 1956 and the same was not yet advertised.
Section 433 of the Companies Act, 1956
- Circumstances in which company may be wound up by Court. A company may be wound up by the Court,-
(a) if the company has, by special resolution, resolved that the company be wound up by the Court;
(b) if default is made in delivering the statutory report to the Registrar or in holding the statutory meeting;
(c) if the company does not commence its business within a year from its incorporation, or suspends its business for a whole year;
(d) if the number of members is reduced, in the case of a public company, below seven, and in the case of a private company, below two;
(e) if the company is unable to pay its debts;
(f) if the Court is of opinion that it is just and equitable that the company should be wound up.
High Court expressed that there was a divergence in the practice followed in different High Courts since the inception of the Companies Act, 1956. Some High Courts required the immediate publication of an advertisement upon the creditor’s winding-up petition being filed; whereas others, including Calcutta and Gauhati, required the Company Court to first be satisfied as to the existence of the indisputable debt before directing the publication of the advertisement.
Invariably, when the Court was satisfied that the debt was indisputably due, an option would be given to the company to pay off the same, failing which, the advertisement would ensue.
With respect to the present matter, the advertisement had not yet been published.
Though the petition was filed before the relevant provisions of the Companies Act, 2013 were notified and the Insolvency and Bankruptcy Code, 2016 came into effect, the law, as it stands now, permitted only matter that has been advertised to be retained by the Court and requires all other matters to be transferred to appropriate Company Law Tribunal since the entire regime as to insolvency had been recognized and parked with such authority.
Hence, the entire matter stood transferred to the National Company Law Tribunal, Guwahati.[Walchandnagar Industries Ltd. v. Green Valley Ind. Ltd., 2022 SCC OnLine Megh 44, decided on 23-2-2022]
Advocates before the Court:
For the Petitioner/Appellant (s)
: Mr. K.K. Mahanta, Sr. Adv. With Mr. K.M. Mahanta, Adv.
Mr. S. Gautam, Adv.
For the Respondent (s)
: Mr. K. Paul, Sr. Adv.
Mr. JM Thangkhiew, Adv.
