1983 PLP 31 (SCMR)

HAMOODUR RAHMAN, C. J.‑By these two petitions, the Punjab National Silk Mills Ltd. seek special leave to appeal from the judgments and orders of a learned Single Judge of the Lahore High Court whereby two Petition filed by the respective respondents herein for the winding up of the petitioner Company were allowed. Learned counsel appearing in support of these petitions contends that the winding up of the companies has been ordered on a complete mis-appreciation of the law relating to a secured creditor. It is contended that although the Court was aware of the fact that the creditor‑Banks applying for winding up were fully secured in respect of their advances by the pledge of goods of a much greater value, the Court had not taken this circumstance into account. Learned counsel has drawn our attention to the statement of account submit ted by the National Bank o` Pakistan itself to show that the goods pledged with it were on its own estimate valued at Rs. 7,11,990 as against a debit balance of Rs. 6,99,899.73. Learned counsel also contends that such a secured creditor should not have been allowed to apply for winding up of the company when he could have recovered his debts by the sale of the pledged goods. In fact, the National Bank of Pakistan did at first seek to do so, for, they filed a suit on the 23rd of December, 1966, but then on the 2nd of January, 1967, they filed the petition for winding up merely to put pressure on the company and to harass it. The application for winding up was, therefore, not a bona fide application. In any event, a creditor, having both remedies available to him, should not after having elected to seek one remedy by way of a suit, be allowed simultaneously to seek another remedy by way of an application for winding up. The learned counsel also complains that the High Court has denied to the petitioner‑Company a valuable right by refusing to summon its witnesses, although the petitioner had filed his list of witnesses and deposited the requisite fee for summoning them on 18‑9‑1967. Notwithstanding this, the evidence was closed arbitrarily on 2‑12‑1969 with the misconceived observation that "in spite of opportunity allowed to respondent (present petitioner) he has neither summoned nor brought any witnesses". This was factually incorrect, as the Court had overlooked the fact that the list of witnesses alongwith the process fee was filed on 18‑9‑1967 and the same still remains unutilised. Complaint is also made of the fact that the judgment of the High Court was delivered in this case after a lapse of about two years. The arguments, it is said, were concluded on the 30th of March, 1970, but the judgment was delivered on the 10th of April, 1972. As a result of this inordinate delay, many of the arguments advanced on behalf of the present petitioner had been overlooked and there was even some confusion about the facts of the two cases, for, the High Court had not deals at all with the facts of the case relating to the cash credit advance of the Commerce Bank Ltd. The debit of the latter was only Rs. 56.569.78 whilst the value of the goods pledged with it, according to statement of the stock prepared by the Bank itself on 31‑12‑1965, was Rs. 7.86,

760. In this case too, the Bank first filed a suit and then applied for winding up. The petition of the Commerce Bank Ltd. was allowed merely because the winding up petition of the National Bank of Pakistan had been allowed. This, it is said, was not a proper way of disposing of the winding up petition filed by the Commerce Bank Ltd. These petitions, in our view, raise certain important questions of la regarding the principles to be followed in the winding‑up of a company, on which there is no authoritative decision of this Court. We are, therefore, of the view that leave should be granted in both these petitions to examine the above questions, but this will be subject to all just exceptions which can be taken to the maintainability of the appeal in this Court on the ground that an appeal lies to a Division Bench of the High Court itself from a judgment and order of a learned Single Judge of the same High Court sitting on the Original Side. These petitions were filed on the 16th of June, 1972, when the Law Reforms Ordinance No. XII of 1972, as promulgated on the 14th of April, 1972, was in force. It barred all appeals under the provisions of the Letters Patent applicable to the High Court. It did not mention anything specifically with regard to appeals under the Companies Act, but it is possible to argue that the bar of the right of appeal under the Letters Patent would include also an appeal under the Companies Act. However, this question is left open for decision at the time of hearing of the appeal. The petitioner will furnish security in the sum of Rs. 2,000 (rupees two thousand) in each case. During the pendency of the appeals in this Court, the Provisional Liquidator appointed by the High Court on the 20th of July, 1967, will continue of function as such but he will not sell the machineries, factory buildings and other immovable properties or other fixed assets belonging to the petitioner‑Company except with the leave of this Court. The appeal should be made ready as expeditiously as possible. Leave granted.