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IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. 7178-7180 OF 2013

(@ SPECIAL LEAVE PETITION (C) NOS.3652-3654 OF 2012)  

  NAGPUR CERAMIC PVT.LTD.  

THROUGH ITS MANAGING DIRECTOR APPELLANT

                VERSUS

CHANDRIKA S/O NANDILAL VISHWAKARAMA     

ETC. ETC.            RESPONDENTS

O R D E R

1. Leave granted.

2. These appeals by special leave are directed against the  

judgment and order passed by the Company Court in Company Appeal  

Nos.8 and 9 of 1994, dated 21.12.2011. By the impugned judgment and  

order, the High Court has admitted the petitions and, thereafter,  

allowed the Company Court to proceed with the Company Petition under  

Section 433(e) of the Companies Act, 1956 (for short 'the Act').

3. The respondents had filed a Company Petition  inter alia  

contending that the appellant is due in a sum of Rs.4 lacs and more  

before the Company Court under Section 433(e) of the Act, whereafter  

the Company Court had issued notice as contemplated under Section  

433(1)(a) of the Act. After issuance of said notice, the appellant-

company  had  filed  its  detailed  reply,  inter  alia,  disputing  the  

claim made by the respondents. The learned Company Judge, taking  

into consideration the defence so pleaded by the appellant-company,  

had thought it fit to reject the petition filed under Section 433(e)

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of the Act.  

4. Being aggrieved by the said order, the respondents herein  

had preferred an appeal before the appellate Court in Company Appeal  

No.10  of  1994.  The  appellate  Court  has  opined  that  the  defence  

pleaded  by  the  appellant-company  is  a  moonshine  defence  and  

therefore it is unable to pay its debts as envisaged under Section  

433(e) of the Act and, accordingly, has admitted the petition and  

had permitted the Company Court to proceed further in the matter.  

Aggrieved by the same, the appellant-company is before us in these  

appeals.

5.    It is relevant to notice that during the pendency of these  

appeals, the appellant-company, in order to prove its  bona fides,  

has deposited the claim made by the respondents along with simple  

interest.  Since  the  respondent-company  has  claimed  a  compound  

interest on the principal amount payable, the appellant-company has  

also deposited the aforesaid amount. This clearly demonstrates that  

the appellant-company has the capacity to pay its financial debts.

6. Further, we have gone through the defence sought by the  

appellant-company before the learned Single Judge wherein they have  

taken a specific plea that the claim made by the respondents is not  

payable by them.  

7. In view of the aforementioned, we are of the considered  

opinion that the defence so pleaded by the appellant-company cannot

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be characterized as a defence taken only for the sake of negativing  

the claim of the respondents nor could it be charactersied as a  

moonshine defence.  

8. In view of the aforesaid conclusion of ours, we are of the  

opinion that the appellate Court was not justified in admitting the  

company petition. In that view of the matter, while allowing these  

appeals, we set aside the judgment and order passed by the appellate  

Court in Company Appeal No.10 of 1994, dated 21.12.2011.

9. We reserve liberty to the respondents, if it so desires,  

to file an appropriate civil suit for recovery of the amounts said  

to be due from the appellant-company, if it is not barred by the law  

of limitation.

Ordered accordingly.

...........................J. (H.L. DATTU)

...........................J. (SUDHANSU JYOTI MUKHOPADHAYA)

NEW DELHI; AUGUST 27, 2013