M/S Hind Paints & Chemicals vs M/S Accurate Transformers Ltd

M/S HIND PAINTS & CHEMICALS ... Appellant(s)

Versus

M/S ACCURATE TRANSFORMERS LTD. ... Respondent(s)

ORDER

Leave granted.

In a Winding Up proceeding, it was alleged that the respondent company was

required to pay an amount of Rs.3,17,352/- to the appellant. It appears that on being

provisionally appointed the Official Liquidator went to the premises of the

respondent-company to take possession thereof. Thereafter, the respondent filed an

application before the Company Judge for recalling the order of appointment of the

Official Liquidator on the ground that the respondent-company had already paid the

principal amount and that only the question of interest remains to be decided. The

matter was heard by the Company Judge, who

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also recorded the said fact and having regard to the provisions of the Delayed

Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993, directed the respondent to pay to the appellant interest on the principal amount @ 9 per cent

per annum, with liberty to the appellant herein, to move the civil court in order to

establish its claim under the provisions of the aforesaid Act. An appeal was

preferred by the respondent herein before the Division Bench, which modified the

order of the learned Company Judge by withdrawing the leave granted to the

appellant to move the civil court for claiming higher interest.

Having heard learned counsel for the respective parties, we are of the view

that the Division Bench committed an error in withdrawing the liberty which had

been granted by the learned Company Judge, to approach the civil court, having

particular regard to the provisions of Section 4 of the aforesaid Act of 1993.

We, therefore, allow the appeal and modify the order of the Division Bench of

the High Court impugned herein by restoring the liberty which had been granted by

the learned Company Judge to the appellant to move the civil court for

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higher interest. The appellant will be at liberty to move the civil court in terms of

the liberty granted by the Company Judge.

...................J. (ALTAMAS KABIR) ...................J. (CYRIAC JOSEPH)

New Delhi, January 06, 2009.