2000-001-CLJ-0033-DEL Companies Act Judgements

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2000-(001)-CLJ -0033 -DEL

KUMAR SECURITIES LTD. v. STICKWELL FASHIONS LTD.

Company Petition No. 290 of 1998 and Company Application No. 946 of 1998, decided on August 18, 1999.

IN THE HIGH COURT OF DELHI

P. K. MITTAL, Advocate, for the petitioner.

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J. P. SINGH, Advocate, for the respondent.

JUDGMENT

DALVEER BHANDARI, J. – The petitioner has filed this petition under section 433, section 434(e) and section 439 of the Companies Act, 1956, for winding up of the respondent company.

2. It is submitted by the learned counsel for the petitioner that the petitioner company consists of chartered accountants who have specialised in financial consultancy.

It is alleged in the petition that the respondent contacted the petitioner for CRB Capital Markets Ltd. It was agreed that the petitioner shall be entitled to a brokerage at the rate of Rs. 0.50 per share on the deal amount. It is further alleged that the deal was clinched between the respondent company and CRB Capital Markets Ltd. Thereafter, the petitioner had sent a bill towards the brokerage for Rs. 9,15,625 being the agreed amount, as charges for bought out deal of the 18,31.250 shares of the respondent with CRB Capital Markets Ltd.

3. It is further alleged that the respondent requested the petitioner to reduce the bill and the petitioner agreed to charge 2% as against Rs. 0.50 per share of the deal amount. It is also alleged that, on that basis, the petitioner became entitled to Rs. 4,98,100 being 2% of Rs. 249.05 lakhs received by the respondent company.

4. It is stated that despite various letters and registered notices when the amount was not paid, the petitioner filed this petition. This court issued notice to the respondent company. The respondent in the reply has taken some preliminary objections. It is stated that the petition, as framed, is not maintainable. It is also mentioned that the claim of the petitioner is bogus and no agreement was arrived at between the parties. Therefore, no amount is due and payable by the respondent to the petitioner. It is further alleged that no statutory notice has been served or received by the respondent.

5. It is mentioned in the reply that the petitioner has created and fabricated evidence for the purpose of this petition and this petition is an abuse of the process of this court, and is liable to be dismissed. In the reply it is clearly denied that any agreement was reached between the parties and the petitioner was not entitled to a brokerage at the rate of Rs. 0.50 per share on the deal amount. It is mentioned that the petitioner had raised a huge demand towards services rendered which was not acceptable to the respondent. It is mentioned that the deal between the respondent and CRB Capital Markets Ltd. was an independent deal, and the petitioner had nothing to do with the same.

6. In the reply, it is denied that the respondent had ever agreed to pay Rs. 9,50,625 to the petitioner. It is also denied that there were any negotiations between the parties, as alleged, and that the brokerage amount was reduced. It is also incorporated in the reply that the letter, dated 28.9.1995 was not written by any authorised officer of the respondent. The said letter is a procured letter, which has seen the light of the day only in the present proceedings. It is mentioned in the reply that Mr. H. S. Grover of the respondent company had no authority to bind the respondent company or take any decision on its behalf. He joined the respondent company on 6.9.1995 and left the same on 23.9.1996. He had no authority to enter into any kind of agreement with the petitioner. It is also incorporated in the reply that it is surprising that the petitioner is alleging himself as a financial consultant and no agreement has been produced to show the nature of dealing between the parties. It is also denied that the respondent has become insolvent or is unable to discharge its day to day obligations. The respondent also mentioned that this petition is an abuse of the process of the court and is liable to the dismissed.

7. I have heard learned counsel for the parties, and perused the documents on record. According to the respondent, there was no arrangement or agreement with the petitioner and the documents have been created and fabricated only for the purpose of filing this petition. It is alleged that the letter, dated 28.9.1995 signed by Mr. H. S. Grover to the petitioner is a procured letter, and that Mr. Grover was never authorised to deal with the petitioner in any manner. Mr. Grover was an employee of the respondent company only for a year, i.e., from 6.9.1995 to 23.9.1996.

8. On consideration of the submissions of the learned counsel for the parties and documents on record by no stretch of imagination, can it be said that there is an admitted liability. The defence which has been set up by the respondent company also cannot be said to be totally devoid of any merit, particularly, in view of the fact that the petitioners are chartered accountants. It is also quite doubtful whether the professional chartered accountants can function as brokers and charge brokerage. In my opinion, the professional chartered accountants are only entitled to their professional fees for the services rendered. In the instant case, the bill sent by the petitioner company is of brokerage and not for the professional fees for services the rendered.

9. At this stage, I do not think it is appropriate to examine the veracity of the stand of the respondent that the documents filed by the petitioner had been created and/or fabricated for the purpose of this petition. The liability of the company is far from being admitted. The petitioner is not entitled to any relief in these proceedings.

10. This petition being devoid of any merit, is liable to be dismissed. However, in the facts and circumstances of this case, 1 direct the parties to bear their own costs.

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