P. K. MAJUMDAR, J. ( 1 ) BY this Judge's summon the petitioners Maddi Lakshmaiah, Maddi Lakshmaiah and Co. Pvt. Ltd. and Maddi Lakshmaiah Agro Products Pvt. Ltd. seek, inter alia, appropriate direction against Duncan Agro Industries Ltd. to pay Rs. 60,24,689. 32p ; if necessary, suitable order directing modification of the order dated 31st July, 1984 and in the event the said sum of Rs. 60,24,289. 32p. is not paid by said Duncan Agro Industries Ltd. the company may be directed to be wound up. ( 2 ) THE petitioners carry on business as suppliers of Tobacco. The National Tobacco Co. Ltd. also known as (NTC) which, until 1977 carried on business of processing of Tobacco and manufacturing of Cigarettes and Tobacco products. The said National Tobacco Co. Ltd. was one of the regular customers of the petitioners. ( 3 ) IN or about 1977 Duncan Agro Industries Ltd. (hereinafter referred to as the 'dail') which was mainly engaged in the Tea business proposed to expand its business activities in Tobacco. In 1977 DAIL purchased from National Tobacco Ltd. its factory at Biccavolu in a bid to embark upon the Tobacco business. Thereafter, DAIL set up a separate division, called Tobacco Division for the purpose of manufacturing and selling of Tobacco / Cigarettes etc. ( 4 ) IN or about 12th September, 1977 an application was made by DAIL and the said National Tobacco Co. Ltd. before this Court for approval of scheme of merger of the said two company on the ground, inter alia, that such merger would be for mutual benefit of the said two companies in regard to the economy, efficiency, profitability and better utilisation of their respective potentials. It is further alleged in the said petition for amalgamation that the operation of the transferor company (National Tobacco Co. Ltd.) would be made financially viable while providing diversification of the activities of the transferee company (DAIL ). By order dated 18th January, 1978 this Court approved the said Scheme of Merger with effect from 1st March, 1977. It is alleged by the petitioners that since then and at all material times the DAIL carried on its Tobacco business in the name and style of "national Tobacco Company, a division of Duncan Agro Industries Ltd. " ( 5 ) AS stated by the petitioners, sometime in 1979 Mr. It is alleged by the petitioners that since then and at all material times the DAIL carried on its Tobacco business in the name and style of "national Tobacco Company, a division of Duncan Agro Industries Ltd. " ( 5 ) AS stated by the petitioners, sometime in 1979 Mr. G. P. Goenka, the Director of DAIL and respondent no. 3 in this proceeding floated another company under the name and style of Tabac Traders Pvt. Ltd. (hereinafter referred to as Tabac) the respondent no. 4 herein, with the object of carrying on business of Tobacco. It is further alleged that there was no doubt in the minds of the persons dealing with Tabac, that such business was done solely on the credit or credit-worthiness of Mr. G. P. Goenka and DAIL. ( 6 ) THE petitioners describe these two units DAIL and Tabac as "goenka Companies". It is the case of the petitioners that they were supplying Tobacco to the said National Tobacco Company prior to its amalgamation with DAIL and after said amalgamation the arrangement was on the basis of representation of said G. P. Goenka that the petitioner nos. 2 and 3 could raise their bills and invoices on any of the Goenka Companies but the ultimate responsibilities for such payment of such bills for purchase would be on the DAIL. Accordingly, all the goods pursuant to such transaction were delivered to DAIL irrespective of the company on which invoices were raised. It is the further case of the petitioners that pursuant to such representation, the credits of the petitioner nos. 2 and 3 were transferred in favour of the petitioner no. 2 and the liabilities of the Goenka Companies were to be assumed by DAIL alone. The petitioner no. 2 sold tobacco worth Rs. 27,99,109. 95 between January 1985 and September, 1985. ( 7 ) IT is the further case of the petitioners that pursuant to such arrangement the DAIL accepted the liability of a principal amount of 1. 73 Crores as on 20th May, 1983 and the DAIL instructed its bankers to pay to the petitioner no. 2 by instalments an aggregate amount of Rs. 1. 84 Crores approximately. The difference of about 11 lakhs was towards part payment of interest. ( 8 ) IT is also alleged by the petitioners that sometime in 1985 another Company, namely, K. S. Subbaih Pillai and Co. 2 by instalments an aggregate amount of Rs. 1. 84 Crores approximately. The difference of about 11 lakhs was towards part payment of interest. ( 8 ) IT is also alleged by the petitioners that sometime in 1985 another Company, namely, K. S. Subbaih Pillai and Co. (India) Pvt. Ltd. the respondent no. 6 also sold Tobacco to Tabac of the aggregate sum of Rs. 21 Lakhs on the same understanding and representation as aforesaid but did not receive any payment therefor. It is also alleged by the petitioners that the respondent no. 6 had, however, been advised to file a suit at Guntur (Andhrapradesh) against Tabac to avoid limitation. ( 9 ) IT is, therefore, claimed by the petitioners that excepting the claim on account of respondent no. 6 for which a separate suit has been filed, the liability of DAIL to the petitioners as on 31st December, 1987 stood at 60 Lakhs and odd. Since 1986 the petitioner No. 1 made various demand on Mr. Goenka, but the petitioners were surprised to see that said Mr. Goenka by its letter dated 2nd March, 1987 took this stand that DAIL had no liability to the petitioner no. 1 or the said Lakshmaiah Companies, the petitioner Nos. 2 and 3. By the said letter said Mr. Goenka had also said that petitioners might have some claim against one New Tobacco Company Ltd. ( 10 ) IT is further alleged by a reference to a new company, namely, New Tobacco Company Ltd. the petitioners were put to some enquiry and upon enquiry the petitioners came to know that sometime in 1984 an application was filed in this Court on behalf of the DAIL and New Tobacco Company for the approval of a Scheme of arrangement between the said two companies and their respective members by and in terms of which the Tobacco Division of DAIL was sought to be transferred to and vested in as a going concern in the said New Tobacco Company Limited with all the assets liabilities pertaining to the said Tobacco Division. It is further alleged the petitioners that the petitioners came to know that the said New Tobacco Company Ltd. was formed by Mr. Goenka sometime in 1984. The petitioners also came to learn that the said application was finally approved and given effect to by an order dated 31st July, 1984. It is further alleged the petitioners that the petitioners came to know that the said New Tobacco Company Ltd. was formed by Mr. Goenka sometime in 1984. The petitioners also came to learn that the said application was finally approved and given effect to by an order dated 31st July, 1984. It is provided by the said order that the Scheme would be binding with effect from 1st April, 1984 on the transferor and transferee company viz. , DAIL and New Tobacco Company Ltd. respectively. ( 11 ) IT is also alleged by the petitioners that considering the sequence of events, it appears that the said scheme of arrangement by the said order dated 31st July, 1984 was obtained by DAIL by misleading the Court suppressing material facts and practising fraud upon this Court. ( 12 ) IT is further alleged by the petitioners that it would appear from the said order dated 31st July, 1984 that the representation was made to the Court that the operation of two divisions, namely The Division and Tobacco Division for last seven years had thrown up certain new perspective which had shed new light on the previous merger and on the economies and convenience of running up Tea and Tobacco business jointly in a single company as it was further represented by the petitioners in the said Scheme application that scheme would not adversely affect the rights of any of the creditors of DAIL or NTC in any manner and due provision had been made for payment of all liabilities as and when the same would fall due. ( 13 ) THE petitioners submit that the said new arrangement of scheme as approved by the said order dated 31st July, 1984 should be set aside or modified on the ground that the said Scheme was proposed by the DAIL and NTC between themselves and the creditors of DAIL had nothing to do with the inter se arrangement between the four parties. That the said scheme cannot be binding on the petitioners being the creditors of DAIL since no notice was given to the creditors. ( 14 ) IT is now, therefore, prayed by the petitioners that they are left with no other alternative but to approach this court for redress of their grievances and to make an order for payment of the lawful dues. ( 14 ) IT is now, therefore, prayed by the petitioners that they are left with no other alternative but to approach this court for redress of their grievances and to make an order for payment of the lawful dues. It is submitted on behalf of the petitioners that on a true and proper construction of the order dated 31st July, 1984, it can be contended that the petitioners' rights were sought to be adversely affected without giving them notice and without hearing them and against the principles of natural justice. It is further contended on behalf of the petitioners that the said scheme was really a device to defraud the creditors including the Revenue authorities and the liabilities were sought to be transferred to a dummy company floated exclusively for the purpose of implementing the scheme of arrangement. ( 15 ) THIS application has been streneously opposed. It has been contended on behalf of the respondents that the petitioners are alleging fraud and also submit that the said order dated 31st July, 1984 sanctioning the scheme had been obtained by fraud and also by suppression of some other material facts. It has been submitted on behalf of the respondents that this being the allegation such a case cannot be decided on the basis of the affidavits and on this application such question cannot be gone into. The petitioners should be relegated to the suit. The respondent, however, strongly relied on an unreported judgment in a Company Petition 353 of 1968, dated 5th May, 1975. It is further submitted on behalf of the respondents that the said order dated 31st July, 1984 is a judgment in rem and therefore, binding on all, whether one was a party or not. ( 16 ) IT has also been submitted on behalf of the respondents that Court has to see that whether the scheme is workable or not and if it is found that the scheme cannot be made workable without any modification, then only it can direct winding up. But the petitioners have not made out any case as to how this scheme is not workable and the modification would be necessary to make scheme workable. But the petitioners have not made out any case as to how this scheme is not workable and the modification would be necessary to make scheme workable. According to the respondents, the entire allegation of the petitioners is that the DAIL is denying to pay the petitioner's dues taking a plea that in view of the amalgamation, the DAIL is not liable to pay the bills raised by the petitioners against DAIL. It is really a dispute, if any, between the petitioners and the DAIL, over the money claimed and this has got no bearing on the scheme as sanctioned by the said order dated 31st July, 1984. It is, therefore, the contention of the respondents that section 392 of the Companies Act, under which this application sought to be made has no application at all to the instant case. According to the respondents, the provision of section 392 can be resorted to only for the proper working of the compromise or if it cannot be achieved, then the Court may make an order winding up the company. It is the further contention of the respondents that the scheme as sanctioned by the order dated 31st July, 1984 has properly made provisions for payment of creditors. Therefore, there is no necessity of making or introducing any further provisions to make it workable by modifying the same. ( 17 ) IT is also the contention of the respondents that the entire object of the petitioners is to recover its money claim by means of an application as has been made to this Court without taking recourse to proper remedies for establishing their claim. It is really what the petitioners asked for, is to make a new scheme in the guise of modification of the Scheme already sanctioned by Court. It is, therefore, contended that this application should be dismissed. ( 18 ) MR. S. B. Mookherjee, appearing for the petitioners has submitted that the said scheme proposed by DAIL and New Tobacco Company was a scheme between themselves and their respective shareholders as would be evident from the scheme itself. Mr. Mookherjee submits that scheme was in a nature of a contract between DAIL and New Tobacco, and the creditors of DAIL (NTC had none at that time) had nothing to do with the inter se arrangement. Mr. Mookherjee submits that scheme was in a nature of a contract between DAIL and New Tobacco, and the creditors of DAIL (NTC had none at that time) had nothing to do with the inter se arrangement. The scheme was between the company and its shareholders and it was neither intended to be nor was binding on any creditors. According to Mr. Mookherjee, the said scheme cannot be binding otherwise on the creditors since no notice was given to the creditors. ( 19 ) IT is the argument of Mr. Mookherjee that the said scheme was a really a device to defraud the creditors including the Revenue authorities and the liabilities were sought to be transferred to a dummy company floated exclusively for the purpose of implementing the Scheme of Arrangement. Mr. Mookherjee has relied upon a decision of Gujarat High Court in a case of Wood Polymer Ltd. v. Bengal Hotels Ltd. (1977) 47 Company Cases 597. In this case it has been held, inter alia, that the court will not lend its assistance to sanction a scheme where the purpose is to defeat a tax liability or even to avoid a tax liability. Mr. Mookherjee has submitted that this decision was approved by the Supreme Court in the case reported in AIR 1986 SC 649 (Mcdowell and Co. Ltd. v. Commercial Tax Officer ). ( 20 ) MR. Mookherjee has also submitted that the claim of the petitioner is against DAIL. The said scheme does not purport to bind the creditors of the company. The expression, "creditors of the Tobacco Division" as appearing from the Scheme approved by the said order dated 31st July, 1984 is a vague expression. It is submitted by Mr. Mookherjee that creditor is a creditor of the company and not of any particular Unit or Division. The learned counsel submits that the creditors sought to bound ought to have been identified, and in order to implement the Scheme, the Court must know who are the creditors and what are their claims which are sought to be covered by the scheme. ( 21 ) MR. R. C. Nag appearing for the respondent No. 1, Duncan Agro Industries Ltd. (DAIL) submits that the power to modify the Scheme under section 392 (2) of the Companies Act can be exercised only for the purpose of proper working of the compromise or arrangement. Mr. ( 21 ) MR. R. C. Nag appearing for the respondent No. 1, Duncan Agro Industries Ltd. (DAIL) submits that the power to modify the Scheme under section 392 (2) of the Companies Act can be exercised only for the purpose of proper working of the compromise or arrangement. Mr. Nag submits that the court would exercise this power only when it is found to the court that it is unworkable, or some modification is necessary to make it workable. He submits that there is no averment in the petition that the compromise is not workable. ( 22 ) MR. Nag also submits that there is no provision in section 392 of the Companies Act for making an order for payment of the claim of the petitioning creditor. He submits that by this petition, the petitioners have asked for appropriate directions to the respondent No. 1 to pay Rs. 60,24,689. 32p to the petitioners, or for suitable order directing modification of the said order dated 31st July, 1984, and in the event the money is not paid by the respondent No. 1, the said company (respondent No. 1) be wound up. Mr. Nag submits that none of the said prayers as asked for can be allowed in the facts of this case. It is the submission of Mr. Nag that for proper, working of the compromise, the court may make an order for modification, and if afterwards the court finds that the Scheme cannot be made workable, it may on the application of any person interested make an order for winding up the company. Mr. Nag submits that the petitioners have not made anywhere a suggestion that the Scheme is unworkable. The only grievance of the petitioners, as would appear from the petition, is that the petitioners certain alleged claim has not been paid. It is also not certain, as he submits, that whether such alleged claim is against DAIL, the respondent No. 1 New Tobacco Co. respondent No. 2 or the Tabac, the respondent No. 4. He submits that the said claim of the petitioners have been bona fide disputed by all the said respondents. He also submit that in any event such payment order, as asked for by the petitioners, is not and cannot be for proper working of the scheme, on the contrary, it is dehors the scheme. ( 23 ) IT is next submitted by Mr. He also submit that in any event such payment order, as asked for by the petitioners, is not and cannot be for proper working of the scheme, on the contrary, it is dehors the scheme. ( 23 ) IT is next submitted by Mr. Nag that the said scheme is essentially an affair relating to the internal affairs of DAIL and the New Tobacco Co. , and the petitioners being outside the said Scheme cannot ask for any modification of the scheme in this proceeding. Mr. Nag submits, in the alternative, that in any event the said scheme as approved by Court is a judgement in rem and it being so, it is binding on all including the petitioners. ( 24 ) MR. B. K. Bachawat appearing for New Tobacco Co. Ltd. the respondent No. 2, submits that this application of the petitioners is wholly misconceived application. It is his submission that the petitioners' alleged claim is wholly outside the Scheme, and it has no concern with the implementation of the said Scheme. Mr. Bachawat submits that, according to the petitioners, between January, 1985 and September, 1985 the petitioner No. 2 sold tobacco, to whom it is not clear from the petition, on the representation of Mr. Goenka or DAIL. Mr. Bachawat submits it would thus appear that the alleged claim of the petitioners arises after the said Scheme as approved by Court by its said order dated 31st July, 1984, and the said alleged claim is only relating to the alleged transaction with DAIL. ( 25 ) MR. Bachawat submits even on the averments in the petition it is not clear who is to be made liable for petitioners' alleged claim. Tabac or DAIL or the New Tobacco. The petitioners' case is that the goods were supplied to Tabac, invoices were raised in the name of Tabac, and the DAIL or the said Mr. G. P. Goenka represented that DAIL would be responsible for payment for the goods supplied. Again, the petitioners contend by referring to the letter of Mr. Goenka dated 2nd March, 1987 that said Mr. Goenka stated that DAIL had no liability to Maddi Lakshmaiah and Co. and the petitioners might have some claims perhaps against New Tobacco Company Limited. It is submitted by Mr. Again, the petitioners contend by referring to the letter of Mr. Goenka dated 2nd March, 1987 that said Mr. Goenka stated that DAIL had no liability to Maddi Lakshmaiah and Co. and the petitioners might have some claims perhaps against New Tobacco Company Limited. It is submitted by Mr. Bachawat that from this pleading it is not certain whether it is the liability of Tabac, or Tobacco Division of DAIL or DAIL or New Tobacco Co. Ltd. Mr. Bachawat submits if it is the liability of Tabac, then DAIL may not be held liable, if DAIL is liable then Tabac or New Tobacco cannot be held liable. In the submission of Mr. Bachawat, this issue does not come within the scope of the said Scheme nor has the said issue anything to do with the workability of the said Scheme. Mr. Bachawat, therefore, submits that it cannot be said that the said scheme is unworkable until this issue is resolved, or that it cannot be said that the question of liability as between the parties to the said Scheme has to be settled first in order to make the said scheme workable. According to Mr. Bachawat, this question is entirely dehor the said scheme, and said alleged claim of the petitioners or the liability thereto has nothing to do with the implementation or workability of the said scheme. Mr. Bachawat finally submits that the said scheme has now been fully worked out and nothing further need be done to make it workable. ( 26 ) MR. P. C. Sen appearing for Mr. G. P. Goenka, the respondent No. 3 has submitted that the first part of prayer (a) of the petition, namely, the order for payment by DAIL is wholly an untenable prayer, and no order for payment can be made on the allegations made in the petition. Mr. Sen submits that the petitioners' alleged claim is disputed, and bona fide disputed, by the respondents Nos. 1, 2 and 3. It is submitted that the present application is under section 392 of the Companies Act, and this section does not empower the Court to make any order for payment. Mr. Sen has referred to a bench decision of this Court in National Small Industries Corporation Ltd. v. Industrial Metal Works (1984) 55 Company Cases 14. 1, 2 and 3. It is submitted that the present application is under section 392 of the Companies Act, and this section does not empower the Court to make any order for payment. Mr. Sen has referred to a bench decision of this Court in National Small Industries Corporation Ltd. v. Industrial Metal Works (1984) 55 Company Cases 14. He also submits that assuming the Court can make such order for payment in this proceeding, the Court would further have to find out who is the debtor, DAIL, TABAC or NTC ? He submits that this question being highly disputed cannot be decided in this proceeding nor is it required to be decided in a proceeding under section 392. ( 27 ) MR. Sen has also submitted that under section 392 of the Companies Act the Court shall have power to supervise the carrying out of the compromise or arrangement ; and may at any time thereafter give such directions in regard to any matter or make such modifications in the compromise or arrangement as it may consider necessary for the proper working of the compromise or arrangement. Mr. Sen submits that the order for payment as asked for by the petitioner is not such direction or modification as would be necessary for proper working of the compromise or arrangement. It is also submitted by Mr. Sen that the said scheme as approved by the said order dated 31st July, 1984 has been fully worked out, and no further direction or modification is necessary for its proper working. ( 28 ) IT is next submitted by Mr. Sen that under sub-section 2 of section 392, if the Court is satisfied that a compromise or arrangement cannot be worked satisfactorily with or without modification, it may either on its own motion or on the application of any person interested in the affairs of the company make an order for winding up of the company, and such order shall be deemed to be an order made under section 433 of the Companies Act. Mr. Sen submits that the third part of the prayer (a) is that in the event the money is not paid by the Duncan Agro Industries Ltd. (DAIL), the said company be wound up. It is the contention of Mr. Mr. Sen submits that the third part of the prayer (a) is that in the event the money is not paid by the Duncan Agro Industries Ltd. (DAIL), the said company be wound up. It is the contention of Mr. Sen that when the Court is called upon to consider this prayer, the Court has to see whether the debt is bona fide disputed, and if bona fide disputed, the Court will refuse to make any order for winding up. Mr. Sen has referred to certain observation of the Supreme Court in well known decision of Amalgamated Commercial Traders Pvt. Ltd. v. K. Krishnaswami (1965) 35 Company Cases 456. It has been observed, inter alia, that where the debt is bona fide disputed it cannot be said that the company is unable to pay its debts. Mr. Sen has also submitted that this disputed liability cannot be adjudicated by the Court in its supervisory jurisdiction under section 392 of the Companies Act, or under any other provisions of the Act. According to Mr. Sen, the only recourse the petitioners may have in the facts of the case, is to establish the petitioners' alleged claim in a suit or any appropriate proceeding. ( 29 ) I have indicated above that the petitioners have asked for addition upon the respondent No. 1 Duncan Agro Industries Ltd. to pay a certain sum of money as claimed in the petition within a certain date ; if necessary, suitable order directing modification of the said order dated 31st July, 1984 sanctioning the said scheme; and in the event the said sum as claimed is not paid by the said Duncan Agro Industries Ltd. , the said company be wound up in terms of prayer (a) of the Judge's Summons taken out on behalf of the petitioners. The petitioners have also prayed for other consequential reliefs. ( 30 ) THE said prayer (a) consist of three parts : (1) order for payment of certain sum of money as claimed by the petitioners by the respondent No. 1, (ii) if necessary, direction for modification of the said scheme, and (iii) in the event of non-payment of the sum of money claimed by the petitioners, the respondent No. 1, the Duncan Agro Industries Ltd. be wound up. ( 31 ) THE case of the petitioners as stated above is that DAIL and National Tobacco Ltd. were amalgamated by a scheme of merger sanctioned by an order of this Court dated 18th January, 1978. The petitioner Nos. 1, 2 and 3 described as "lakshmaih Companies" were supplying tobacco to the said National Tobacco Ltd. prior to its amalgamation with DAIL. After the said amalgamation, petitioners supplied tobacco to Tabac the respondent no. 4 and DAIL, the respondent No. 1 described by the petitioners as "goenka Companies" on the understanding or arrangement that DAIL would responsible for payment for the supplies of Tobacco irrespective of the fact that invoices were raised upon Tabac or Tobacco Division of DAIL. In the premises, a sum of Rs. 60,24,689. 32 is due and payable by DAIL after giving credit for earlier payments, to the petitioners. ( 32 ) NOW the point for consideration is whether the court can make an order for payment in a proceeding under section 392 of the Companies Act. This application of the petitioners is under section 392 of the Companies Act. Under section 392, where a High Court makes an order under 391 sanctioning a compromise or an arrangement in respect of a company, (a) it shall have power to supervise the carrying out of the compromise or arrangement; and (b) it may, at the time of making such order or at any time thereafter, give such directions in regard to any matter or make such modifications in the compromise or arrangement as it may consider necessary for the proper working of the compromise or arrangement. ( 33 ) THIS section can only be invoked for the purpose of proper working of the compromise or arrangement. The power as conferred by this section 392 on the court is a power of superintendence which may be exercised by issuing appropriate directions or effecting necessary modification so as to ensure the proper working of such compromise or arrangement. Therefore, direction or modification, whatever necessary, is only to ensure proper working of the compromise or arrangement, only to achieve that object and no other. ( 34 ) THE said order dated 3!st July, 1984 sanctioning the said Scheme provides, inter alia, that all rights and interest of the transferor company (DAIL) relating to its Tobacco Division be transferred from the said transfer dated (1. 4. ( 34 ) THE said order dated 3!st July, 1984 sanctioning the said Scheme provides, inter alia, that all rights and interest of the transferor company (DAIL) relating to its Tobacco Division be transferred from the said transfer dated (1. 4. 1984) without further act or deed to the transferee company (New Tobacco Co. Ltd.) and accordingly the same shall pursuant to section 394 (2) of the Companies Act, 1956 be transferred to and vest in the transferee company for all the properties, rights and interest of the said transferor company, and that all the liabilities and duties of the said transferor company relating to its tobacco division be transferred from the said date (1. 4. 1984) without further act or deed to the said transferee company and accordingly the same shall pursuant to section 394 (2) of the Companies Act, 1956 be transferred to and become liabilities of the said transferee company. The said order also mentions that any person interested shall be at liberty to apply to the Court in the above matter for any direction that may be necessary. ( 35 ) NOW, let us see whether the direction for payment by DAIL to the petitioners, as sought for by the petitioners, is necessary for the proper working of the said compromise or arrangement. The petitioners, as stated above, have asked for payment of their dues on the basis of representation or assurance by said Goenka, the respondent no. 3 or DAIL, the respondent no. 1 that DAIL would be responsible for payment for supplies made by the petitioners to the Tabac or the tobacco division of DAIL. Is this direction for payment by DAIL to the petitioners necessary for the proper working of the compromise or arrangement ? ( 36 ) IT has been held by the Supreme Court in S. K. Gupta v. K. P. Jain (1979) 49 Company Cases 342 as under : "the purpose underlying section 392 is to provide for effective working of the compromise and/or arrangement once sanctioned and over which the court must exercise continuous supervision (see section 392 (1)), and if over a period there may arise obstacles, difficulties or impediments, to remove them again, not for any other purpose but for the proper working of the compromise or arrangement. This power either to give directions to overcome the difficulties or if the provisions of the scheme themselves create an impediment, to modify the provision to the extent necessary, can only be exercised so as to provide for smooth working of the compromise and/or arrangement. To effectuate this purpose, the power of widest amplitude has been conferred on the High Court and this is a basic departure from the scheme of the U. K. Act in which provision analogous to section 392 is absent. The sponsors of the scheme under section 206 of the U. K. Act have tried to get over the difficulty by taking power in the scheme of compromise or arrangement to make alterations and modifications as proposed by the court. But the Legislature foreseeing that a complex or complicated scheme of compromise or arrangement spread over a long period may face unforseen and unanticipated obstacles, has conferred power of widest amplitude on the court to give directions and, if necessary, to modify the scheme for the proper working of the compromise or arrangement. The only limitation on the power of the court, as already mentioned, is that all such directions that court may consider appropriate to give or make such modifications in the scheme, must be for proper working of the compromise and/or arrangement". ( 37 ) IT will appear from the above observation of the Supreme Court that directions, and, if necessary modifications would be made only for the proper working of the compromise or arrangement and for no other purpose. Again, such directions or modifications may be made for removing any obstacles, difficulties or impediments, and that is also for proper working of the compromise or arrangement. In the instant case, the petitioners have not been able to indicate what are the obstacles, difficulties or impediments, and in order to remove any of them, such direction for payment is necessary, and also such direction is necessary for proper working of the compromise or arrangement. Reading the scheme I do not find any obstacle, difficulty or impediment therein, or that the said scheme cannot be made workable but for such direction. Reading the scheme I do not find any obstacle, difficulty or impediment therein, or that the said scheme cannot be made workable but for such direction. The only limitation on the power of Court, as has been observed by the Supreme Court, is that all such directions that court may consider appropriate to give or make such modifications in the scheme must be for proper working of the compromise and/or arrangement and for no other purpose. I am, therefore, of the opinion that such direction for payment as prayed for is not warranted in order to remove any obstacle, difficulty or impediment as there is none in the present scheme. ( 38 ) THE petitioners have also asked for suitable order, if necessary, directing modification of the order dated 31st July, 1984. I have already indicated above the scope of section 392 of the Companies Act. It is provided under section 392 (1) (b) that the Court may, at the time of making such order or any time thereafter, give such direction in regard to any matter or makes such modifications in the compromise or arrangement as it may consider necessary for the proper working of the compromise or arrangement. The Court may also make such modification in the compromise or arrangement for the proper working of the compromise or arrangement. It appears to me that the said scheme has already been worked out and there is nothing further to be provided in the scheme to make the same workable. Therefore, in my opinion, there is no scope for any modification, as claimed by the petitioners, in the scheme for proper working of the same. The petitioners have asked for modification perhaps in the context that some directions have to be made for payment of the petitioners alleged dues by the respondent no. 1. I have indicated above that there is no scope for giving such direction in a proceeding under section 392 where, as already stated, the directions may only be given in regard to any matter for proper working of the compromise or arrangement. ( 39 ) THE last part of the prayer of the petitioners is that in the event the said sum as claimed by the petitioners is not paid by the said Duncan Agro Industries, the respondent no. 1, the company (meaning the respondent No. 1) may be directed to be wound up. ( 39 ) THE last part of the prayer of the petitioners is that in the event the said sum as claimed by the petitioners is not paid by the said Duncan Agro Industries, the respondent no. 1, the company (meaning the respondent No. 1) may be directed to be wound up. ( 40 ) SUB-SECTION 2 of 392 of the Companies Act, provides that if the Court is satisfied that the compromise or arrangement sanctioned under section 391 cannot be worked satisfactorily with or without modifications, it may, either on its own motion or on the application of any person interested in the affairs of the company, make an order winding up of the company, and such an order shall be deemed to be an order made under section 433 of this Act. ( 41 ) IT is my understanding of section 392 of the Companies Act that the necessity of making an order of winding up of the company will only arise if the court is satisfied that the compromise or arrangement cannot be worked satisfactorily with or without modification and if such order of winding up is made in such circumstances, then such order of winding up shall be deemed to be an order under section 433 of this Act. ( 42 ) IN my opinion, if the court is satisfied that the compromise or arrangement can be worked satisfactorily or has already been worked out, then no modification would ever be necessary. If it is, however, the finding that the arrangement cannot be worked out satisfactorily even with or without modification, a necessity may arise to make an order winding up of the Company. It appears to me that under section 392 (2) of the Companies Act the condition precedent to an order of winding up of the company is that the compromise or arrangement cannot be worked out satisfactorily with or without modifications. If there is no such contingency, then there will be no occasion for making an order of winding up of the company. ( 43 ) SECTION 392 (2) of the Companies Act also provides that the order of winding up of the company shall be deemed to be an order made under section 433 of this Act. If there is no such contingency, then there will be no occasion for making an order of winding up of the company. ( 43 ) SECTION 392 (2) of the Companies Act also provides that the order of winding up of the company shall be deemed to be an order made under section 433 of this Act. It does not mean, in my opinion, that the requirements under section 433 should also be present when the court consider the case to make an order of winding up of the company under section 392 (2) of the Companies Act. ( 44 ) I am, therefore, of the view that while considering the case for winding up the company under section 392 (2) of the Companies Act the court is not required to consider the requirements made in section 433 (a) to (f) of the Companies Act. I think that the court is not required to enquire while making an order of winding up the company under section 392 (2) of the Companies Act whether the company is unable to pay its debt or whether it is just and equitable that the company should be wound up. ( 45 ) EVEN if it is assumed that when the court makes an order winding up of the company in the circumstances envisaged in section 392 (2) of the Companies Act, the court can take into consideration of the situation enumerated in section 433 of the Companies Act. If that be so, then on the facts of the case, the claim of the petitioners is disputed and disputed bonafide. Therefore, it becomes a bonafide dispute. I have already indicted above that it is not certain from the petitioners own showing as to against whom the debt is to be enforced, the DAIL or New Tobacco Company or Tabac. It is also to be enquired into whether the petitioners carried on transaction after the amalgamation or before on the alleged representation of said Goenka the respondent no. 3 or DAIL the respondent no. 1. It is also to be enquired into whether the petitioners carried on transaction after the amalgamation or before on the alleged representation of said Goenka the respondent no. 3 or DAIL the respondent no. 1. This requires an adjudication and as has been held by Gujarat High Court in Divya Vasundhara Financiers (P) Ltd. (1984) 56 Company cases 487 wherein it has been observed, to which I respectfully agree, that the power under section 392 is of widest amplitude but it cannot be said that it is a power without an limitation and the limitation being that it can be invoked only for purpose of proper working of the compromise or arrangement. But this power cannot be invoked for the purpose of determination or adjudication of an right or interest claimed. ( 46 ) I, therefore, hold on the facts of the case that the court in a proceeding under section 392 of the Companies Act cannot give any direction as to the payment of the sum as claimed by the petitioners against the respondent no. 1. I also hold that there is no situation in the facts of the case warranting any modification of the order dated 31st July, 1984. I also held that even if it is assumed that the petitioners are entitled to the sum claimed and the same has not been paid by the respondent no. 1, the court cannot on that ground make an order for winding up of the respondent no. 1. ( 47 ) IN the result, this application fails and is hereby dismissed. Interim order, if any, is vacated. There will be no order as to costs. There will be stay of operation of this Judgment and order till 29. 10. 90. Application dismissed.