JUDGMENT : - By a letter dated October 3, 1997 advocates for the petitioner served on the company the statutory-notice of demand under section 434 of the Companies Act, 1956 and claimed that the company was indebted to the petitioner in the sum of Rs. 38,60,42,000.00. Advocates for the company denied the alleged claim and in its reply dated October 25, 1997 made a counter claim of a sum of Rs. 3,18,13,689.00. On October 27, 1997 the company instituted a suit in the Bombay High Court, (Suit No. 4042 of 1997, Geekay Exim (India) Ltd. vs. Credential Finance Ltd.) against the petitioner and among other relief’s claimed a decree for a sum of Rs. 3,18,13,689.00. This application was made by the petitioner in this Court on January 14, 1998. 2. The case made out by the petitioner was, that in the course of its business in leasing and financing the parties had entered into an oral agreement hereunder the petitioner had granted and the company enjoyed bill-discounting facilities on certain terms and conditions. It had been alleged in the petition, that in pursuance of a further oral agreement between the parties, the petitioner had arranged funds for the company which the company had received and enjoyed, and the petitioner was entitled to the agreed brokerage on that account. According to the petitioner, the company had issued post-dated cheques by way of securing the bill-discounting transactions and some of those cheques had been encahsed after the completion of various transactions, and the charges had been adjusted according to agreed rates. Most of the post-dated cheques, it was alleged by the petitioner, were however, dishonoured upon presentation to the company's bankers, and the petitioner had instituted criminal proceedings against the company in that respect. The petitioner believed that the company was commercially insolvent, in involved circumstances, unable to pay its debts, the substratum of the company had been eroded and that the assets, properties and valuable undertakings of the company were being sought to be alienated and reduce the company "to a husk". 3. The petitioner's cause of action, argued counsel, was based strictly on the dishonoured cheques which according to him were bills of exchange. He contended that the claim of the petitioner was for the sum of Rs. 38,60,42,000.00, which was the aggregate amount of the dishonoured cheques. 3. The petitioner's cause of action, argued counsel, was based strictly on the dishonoured cheques which according to him were bills of exchange. He contended that the claim of the petitioner was for the sum of Rs. 38,60,42,000.00, which was the aggregate amount of the dishonoured cheques. Reliance was placed on the decision reported in (1980) 1 LLOYDS REPORT 50, and it was submitted by counsel, that between the parties to a bill-of-exchange there could not be any adjustment in respect to other transactions. According to him, the claims which were made by the company were in the nature of compensation, and that too were based on an alleged oral understanding between the parties. He cited and relied on the decision reported in A. (1962) Cal 613. He drew the attention of the Court to two facsimiles dated 20th and 21st June, 1997 and contended that the company had in no uncertain terms admitted that more than a sum of Rs. 19 crore was due and payable by the company to the petitioner and that there was no allegation on behalf of the company that there was any claim of the company which had not been included in making the admission. 4. According to the company, the agreement between the parties was that each would deploy funds in the other which would be repaid through a buy-back arrangement, and that the petitioner would make available to the company funds, which either belonged to the petitioner or the petitioner would arrange from elsewhere, and the petitioner would get a return at the rate of 26% per annum with quarterly rests. In terms of the agreement, it was alleged by the company in its affidavit that, there were several financial transactions between the parties, and that substantial sums of money had been invested by the company, "By or at the instance of the petitioner", and that the petitioner had acted as a "Financier/Broker" for the company and that inspite of repeated demands the petitioner did not submit any particulars of such investments. In September, 1995, it was further submitted on behalf of the company that, the new Managing Director of the company "took stock of the situation" and brought it to the notice of the petitioner. In September, 1995, it was further submitted on behalf of the company that, the new Managing Director of the company "took stock of the situation" and brought it to the notice of the petitioner. "That there was something basically wrong in the whole affair and instead of the company being out of difficulties, was in fact out of pocket liquidity-wise." It was also alleged on behalf of the company, that "It was expressly agreed upon that the entire transaction between the parties would be gone into and accounts finalised and balance struck in totality." The reason for instituting the suit in Bombay High Court, according to the company was because of the mala fide conduct of the petitioner and false claim made in the statutory notice which had been sent by the petitioner to the company. 5. It appeared to me from its affidavit in opposition that the defence of the company rested principally on the allegation that one Rajiv Kochhar, the Chief Executive and a Director of the petitioner, in collusion with the then Managing Director of the company one Sethuraman had used the company "in the guise of managing the finance and investment of the company and its group of Companies, ............as a vehicle to deploy and raise funds for the benefit of the petitioner........" In its affidavit the company further alleged, that "The post-dated cheques were given only as a stop-gap arrangement until the accounts were brought in order." Later in the affidavit it had changed its stance and alleged that, "It was therefore, agreed and understood that the petitioner would not present the said cheques at all." Finally, with regard to the petitioner's alleged debt according to the company, "upon taking account of all the transactions by and between the parties it is determined that nothing is due and payable by the Company to the petitioner." 6. I, however, would be of the view that nothing could be "determined" by the company on which this Court would rely, until the alleged oral agreement between the parties, the several transactions, and the accounts in that respect, were proved and decided by the appropriate forum in appropriate proceedings. Until then, such allegations made on behalf of the company would, I fear, remain in the realm of mere assertions and conjectures. Until then, such allegations made on behalf of the company would, I fear, remain in the realm of mere assertions and conjectures. There was nothing before this Court to substantiate the allegations of the company, with regard to there being an agreement or understanding, that the post-dated cheques were not to be presented at all or at least not until the accounts were brought in order. The explanation sought to have been forwarded on behalf of the company as to how it had taken care of the aggregate amount of the post-dated cheques was, to put it mildly, confusing, far-fetched and most unsatisfactory in the circumstances because some of those cheques had in fact been encashed. Nothing, either substantial or credible, had been submitted in that respect on behalf of the company for the consideration of this Court. It appeared from the annexure to the petition, that most of those post-dated cheques had been dishonoured on account of the company not having sufficient funds. The petitioner had commenced criminal proceedings against the company on that account. There was little scope of denial by the company of its knowledge of the cheques being dishonoured and the reason. There was no prima facie proof before this Court that the company had expressed any view or had at all responded in the matter contemporaneously. There was no proof that the petitioner had acted as a "Financier/Broker" or that due to a close association between the Managing Director of the company and the Chief Executive of the petitioner, the parties had entered into the alleged oral agreement, or that the company had made large investments at the instance of the petitioner, or that inspite of repeated demands the petitioner did not disclose particulars in respect to those investments. 7. In its affidavit-in-opposition the company alleged that "On making up accounts as on 31.03.1996 the company realized that the Company had to recover substantial amount from the petitioner even if the alleged claims of the petitioner were taken into account". There was however, no indication as to why for almost seven months the company had chosen to remain silent in respect to its alleged realization, and had considered it fit to air all its allegations in its reply dated October 25, 1997 to the petitioner's statutory notice of demand. There was however, no indication as to why for almost seven months the company had chosen to remain silent in respect to its alleged realization, and had considered it fit to air all its allegations in its reply dated October 25, 1997 to the petitioner's statutory notice of demand. According to the company, in "late September, 1995", it had brought it to the notice of the petitioner that instead of deriving any benefit the "whole affair" between the parties had rendered the company "out of pocket liquidity wise". There was however, no proof of such communication. The company further alleged in its affidavit that, "It will also be evident from the various letters and accounts sent by the petitioner that there was buy-back arrangement with regard to the shares held by the petitioner in the Company..................." yet no such letters or accounts were either annexed nor produced before this Court. The denial by the company as to its acknowledgement, as contained in the two facsimiles dated 20.06.97 and 21.06.97 to the effect that the sum of Rs. 19,42,32,332.00 was payable by the company to the petitioner as on 31.03.97, was most unsatisfactory. It was quite obvious, that the allegations of the company were an afterthought and obviously concocted for the purpose of avoiding payment of its lawful dues to the petitioner. Once again none of the allegations of the company was supported by any proof of any sort. Both the two facsimiles, were signed by the Managing Director of the company and the signatures were not disputed. 8. In those circumstances, I would be inclined to harbour grave doubts as to the bona fides of the defence, sought to have been raised on behalf of the company. Its counter-claim would of course be decided in the suit pending before the Bombay High Court. I was dissatisfied primarily for the lack of any prima facie proof in support of the contentions of the company, that the bill-discounting transaction was one of divers transactions between the parties in pursuance of an oral agreement. A mere assertion. In order to recover its alleged claim the company would of course be required to prove the alleged oral agreement or arrangement. A mere assertion. In order to recover its alleged claim the company would of course be required to prove the alleged oral agreement or arrangement. As far as these proceedings were concerned if I was to subscribe to the contentions of the company it would necessarily be admitting that the company was at liberty to act in matters of grave financial consequence to its affairs and funds without any resolution of the Board of Directors or ratification by it subsequently. In view of the pending suit, I shall refrain further deliberating as to the conduct of the company in failing to produce any prima facie proof to substantiate its defence. 9. According to the petitioner the bill-discounting transaction between the parties was in pursuance of an oral agreement. The precise scope of the agreement would be required to be proved in order to establish the nitty-gritty of the relationship between the parties, as to who would get what, when and how much. After all, it was admittedly an oral-agreement. In these proceedings the petitioner of course was not entitled to its claim 'ex debito justitiae'. It was however, admitted by the parties, the postdated cheques had been issued by the company in favour of the petitioner, and that most of the cheques had been dishonoured upon presentation. As there was no prima facie proof I shall disregard the numerous 'ifs' and 'buts', alleged by the company in an endeavour to raise a defence to the petitioner's claim for the first time in these proceedings. Counsel for the company had strenuously argued, denying the legality, validity and sufficiency of the factum of the presentation of the post dated cheques by the petitioner. Be that as it may, as I have observed earlier, that the oral agreement under which, according to the petitioner, the parties had carried on the transactions in bill-discounting was required to be proved before an appropriate forum and in appropriate proceedings Except for the amount appearing in the two facsimiles, I am afraid no other claim made by the petitioner could be considered in these proceedings. 10. In those circumstances it appeared to me that the amount which had been unequivocally acknowledged by the company in the two facsimiles, uncontroversial and I have already indicated my reasons earlier in this order. Both the documents had been signed by the Managing Director of the company. 10. In those circumstances it appeared to me that the amount which had been unequivocally acknowledged by the company in the two facsimiles, uncontroversial and I have already indicated my reasons earlier in this order. Both the documents had been signed by the Managing Director of the company. It was significant that since June 21, 1997, which was the date of the later of the two facsimiles, there had been no response whatsoever in that matter by the company, and therefore the explanation put forward on its behalf in its affidavit-in-opposition could but be considered as a mere afterthought and quite futile. I would therefore find the company, on its own admission, indebted to the petitioner for the sum of Rs. 19,42,32,332.00 which sum the company failed and neglected to pay inspite of demands. 11. For those reasons, the petition is admitted for the sum of Rs.19,42,32,332.00. The company shall be at liberty to pay the admitted sum of Rs. 19,42,32,332.00 to the petitioner on or before August 30, 1999. In default of payment by the company the petitioner shall be at liberty to publish advertisements on any Sunday, once in "Statesman" and once in "Ananda Bazar" two local daily newspapers of some circulation in the State of West Bengal. Publication in the 'Official Gazette' shall be dispensed with. The matter shall be returnable before the Company Court, six weeks after such publication. 12. The petitioner shall be at liberty to institute a suit in the appropriate forum, in respect to its balance claim if it was so advised. The petitioner shall be restrained from instituting such suit for a period of two weeks from August 30, 1999. 13. Parties shall act on a xerox of the signed copy of this dictated order on the usual undertakings. Ronojit Kumar Mitra, J. Petition admitted.