Legal Sectionof revival, Ramesh G. Bhatia v. GopalaGases P. Ltd., (1994) 3 Comp LJ 435(Del);6. Where there was suspension ofbusiness for over a year, the number ofmembers was reduced to less than two, alldirectors but one were absconding andassets were taken over by the lendinginstitution, the petition by the soleremaining director for winding up wasadmitted. The argument of the lendinginstitution that the winding up was beingrestored to, to escape the remainingliability to the institution was notaccepted. Surendra Kumar Pareek v.Shree Guru Nanak Oils P. Ltd. (1995) 82Com Cases 642 (Raj).7. Where various banks and financialinstitutions refused to advance term loanson account of the antecedents of themanaging director, and by change ofmanagement also, the position of thecompany could not be revived. KeralaS t a t e I n d u s t r i a l D e v e l o p m e n tCorporation v. Poonmudi Tea Pack Ltd.(1988) 63 Com Cases 575 (1987) 3 CompLJ 180 (Ker).8. The directors of a company which hadcheated investors, banks and financialinstitutions were also involved in therespondent company. Statutory noticewas simultaneously given to it also withnor reply. Advertisement also madewithout any objection. No business wasdone by the company since incorporation.Registrar of Companies v. Amit InterChemicals P. Ltd., (2003) 42 SCL 743(All).11. In the case of Registrar of Companiesv. Bihar Wire and Wire Products (P.) Ltd.,(1975) 45 Com Cases 194 (Pat), the courtpointed out a long line of decision on thequestion of winding up which establishamong others, the following propositionsof law:1. That the mere fact that business has notbeen commenced within a year or thatbusinesshas been suspended for a whole year ormore by itself is not a ground for a court toorder winding up, although they give thejurisdiction to the court to do so.2. That it has to be found out whether thenon-commencement or suspension ofbusiness was for some good reasonaccounting for it.3. That the fact of non-commencement orsuspension of business is an evidencewhich indicates that the company has nointention of carrying on business or that itis not likely to do so.4. That the decisive question is whetherthere is a reasonable hope of the companycommencing or resuming business anddoing it at a profit, and whether thesubstratum of the company hasdisappeared.5. It has to be clearly established that thecompany was incorporated for the solepurpose that could no longer be achieved.Winding up is not appropriate where thedirectors in the exercise of theirmanagerial powers decide to dispose ofthe main but not the sole business of thecompany. Strong v. J. Brough & Son(Stratsfield) Pty. Ltd., (1991) 4 ACSR 296(SC of New South Wales).6. Winding up order was passed: Wherethe substratum of the company was goneor its only business had becomeimpossible; Re, Haven Gold Mining Co.,(1882) 20 Ch D 151; Re, German DateCoffee Co., (1881-5) All ER Rep 372:(1882) 20 Ch D 169; AmalgamatedSyndicate, Re, (1897) 2 Ch 600 : (1895-9)All ER Rep 340; Re, Taldua Rubber Co.Ltd., (1946) 2 All ER 763; Cf. Re, Kiston& Co. Ltd., (1946) 1 All ER 435; Re,Perfectair Holdings Ltd., 1990 BCLC 423(Ch D); In Re, H.C. Insurance SocietyL t d . , ( 1 9 6 0 ) 6 5 C W N 6 8 . S e eK u m a r p u r a m G o p a l a k r i s h n a nAnanthakrishnan v. Burdwan-Cutwa rly.Co. Ltd., (1978) 48 Com Cases 211 (Cal)and on appeal at page 611 followed inBombay Cas Company Ltd. V. HindustanMercantile Bank Ltd., (1980) 50 ComCases 202 (Cal); Akola Electric SupplyCo. Ltd., In Re, (1962) 32 Com Cases 215: AIR 1962 Bom 133; Davco ProductsLtd. V. Rameswarlal Sadhani, AIR 1954Cal 195 (Three was no reasonable chanceof the company starting business again).But not where the substratum had notcompletely gone and the majorityshareholders opposed. See MohanlalDhanjibhai Mehta v. Chunilal B. Mehta,(1962) 32 Com Cases 970 : AIR 1962 Guj269; Janbazar Manna Estates Ltd., Re,(1931) 1 Com Cases 243 : AIR 1931 Cal692; George v. Athimattam Rubber Co.Ltd., (1965) 35 Com Cases 17 (Ker).12. So far as other crucial and pivotalfactors required significant considerationis with regard to the substratum of acompany that seems to have gone when(a) the subject matter of the company isdisappeared, or (b) the object for which itwas incorporated has substantiallycollapsed, or (c) it is impossible to carryon the business of the company except at aloss and there is no reasonable hope oftrading at a profit. But, where a companysold its undertaking, if there is still somebusiness which it can carry on, it cannotbe said that the substratum haddisappeared. Ref: George v. AthimattamRubber Co. Ltd., (1965) 35 Com Cases17. Where the company in question hadtotally disappeared with nobodyattending its office and high officials wereabsconding and the company's officebeing under lock, no one received noticeand even to newspaper announcementthere was no response from any quarter,naturally it was a fit case for an order ofwinding up. Ref: Bhartiya Gramin VikasVitta Nigam Ltd. Re, (2000) 27 SCL 249(All).20. As a result of above discussion, it isordered that the respondent company bewound up. Official Assignee is appointedOfficial Liquidator. The Company shallsubmit the statement of affairs to theOfficial Liquidator in accordance withlaw. The Official Liquidator aftercomplying with all requisite formalitiesshall submit the report.MH/S-82/SindhPetition allowed.Insurance Journal July, August, September 202142Find us at: www.insurancejournal.com.pk — www.facebook.com/insurancejournalpakistan
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