Shri Rohit Deo, counsel v. Vishwanath & Ors.

Shri Rohit Deo, counsel for respondent nos.1 and 2. CORAM : R. K.DESHPANDE, J. DATED : 8 th APRIL, 2011. This petition has been filed under Section 434 of the Companies Act, 1956. During the pendency of this petition, the learned counsels appearing for the parties had informed, that a Memorandum of Understanding was entered into between the petitioner and respondent on

18.10.2010. Under the said Memorandum of Understanding, the respondent company agreed to pay an amount of Rs.1.34 Crores to the petitioner in …..2/- 2 full and final settlement of the claim and the petitioner has agreed to withdraw the Company Petition. Accordingly, along with the affidavit dated

18.10.2010, the respondent company has placed on record this Memorandum of Understanding and has submitted that the petition be disposed of as withdrawn in terms of the Memorandum of Understanding. The claim of the respondent no.1 for disposal of petition as withdrawn on the basis of this compromise has been opposed by the petitioner. Shri K.Ramesh, the learned counsel appearing for the petitioner has submitted that there was an oral understanding between the parties, when the Memorandum of Understanding dated 18.10.2010 was executed, that the respondent company shall execute the Power of Attorney in favour of the petitioner so as to enable the petitioner, to realize a sum of Rs.2.19 Crores plus interest due to the respondent company from one M/s.Malabar Cements Limited. However, such Power of Attorney has not been executed as per the …..3/- 3 understanding and therefore, the petitioner is not willing to act upon the Memorandum of Understanding dated 18.12.2010. According to the petitioner, this Court should proceed to decide the company petition on its own merits. Shri K.Ramesh, for the petitioner has relied upon the decision reported in Sripat Vs. Vishwanath and others, AIR 1973 Allahabad 527 (V 60 C183) 527 , to urge that it is only after the Court is satisfied that there had in fact been the compromise and such compromise was lawful one, that there would be no option left to the Court, but to record it and pass the decree in terms of the agreement. He has further submitted that before recording of compromise, the petitioner had opposed such claim and unless this Court records the finding in respect of the enforceability of the compromise, the compromise in terms of Memorandum of Understanding, cannot be acted upon. Shri Rohit Deo, the learned counsel …..4/- 4 appearing for the respondent has invited my attention to the earlier Memorandum of Understanding executed between the parties on

23.12.2006, whereby it was agreed between the parties, that a sum of Rs.1.34 Crores shall be paid in terms of the said settlement. According to him, it is to implement the terms of the said Memorandum of Understanding, that the another Memorandum of Understanding dated 18.10.2010, has been entered whereby it was agreed by the respondent to pay the petitioner an amount of Rs.1.34 Crores. He submits that the only objection to this Memorandum of Understanding, raised by the petitioner is that there was an oral understanding for execution of Power of Attorney to realize an amount of Rs.2.19 Crs plus interest from the M/s.Malabar Cements Limited. He submits that neither the contents nor execution of both the Memorandum of Understandings has been disputed. Shri Deo further submits that without going into the question whether the Memorandum …..5/- 5 of Understanding dated 18.10.2010 can be acted upon or not, the petition needs to be dismissed on the ground that it is a bonafide dispute which subsists between the parties and for that purpose this is not a forum available to the petitioner.

He has relied upon the decision of the Hon’ble Apex Court reported in Pradeshiya Industrial & Investment Corporation of U.P. Vs. North India Petrochemicals Ltd. and another, (1994) 3 SCC 348. The fact that the Memorandum of Understanding was entered into between the parties on 23.12.2006 and 18.10.2010, has not been disputed. The contents of both Memorandum of Understandings are also not disputed. It is also not disputed that an amount of Rs.1.34 Crs has been paid and it has been accepted by the petitioner. In view of this factual position, the decision of Sripat Vs. Vishwanath and others, AIR 1973 Allahabad 527, relied upon by the learned counsel appearing for the petitioner, is not applicable. The question is whether such …..6/- 6 Memorandum of Understanding can be enforced, in view of the oral understanding between the parties. This cannot be gone into in this petition for winding up. It raises the bonafide dispute and it is open for the petitioner to adopt all such remedies as are available to the petitioner company, to seek enforcement of the alleged oral understanding. In view of this, the present company petition cannot be entertained. The same is, therefore, dismissed. Needless to say that dismissal of this winding up petition shall not come in the way of the petitioner to adopt all such remedies as are available in law. JUDGE BRwankhede …../-