Judgment :- SANJIB BANERJEE, J. (1) THE company throws a preliminary challenge to the creditors application for winding up being received. The statutory notice, the company says, was not issued to its registered office and, thus, the legal fiction in section 434 (1) (a) of the Companies Act, 1956 would not work in favour of the petitioner. The company also makes out a case in defence of the claim and urges that in the unlikely event of the creditors petition being found maintainable, it should not be admitted by virtue of the substantial defence that the company sets up. (2) THE petitioner claims a sum of Euro 3916. 47 to be due from the company and suggests that the companys reluctance to pay the Indian equivalent thereof despite receipt of the statutory notice warrants this petition being received and the company being ultimately sent into liquidation. The petitioner is incorporated in Singapore and claims to be part of the SKF group of concerns, headquartered in Sweden but having substantial operations in the manufacture and supply of bearings in India. The petitioner relies on an agreement of february 14, 2003 that was entered into on behalf of the SKF concerns through skf Bearings India Limited with the company for supply and import of SKF products. The petitioner has relied on three invoices, all of December, 2003 for euro 1153. 52, Euro 2309. 69 and Euro 453. 26 for a combined claim that translates to a little over Rs. 2. 20 lakh at the present rate of exchange. (3) THE statutory notice of February 15, 2005 was addressed to the company at its Marshall House address in Calcutta but the room or office number was indicated as 407. In the notice and the cause-title to the petition, the registered office of the company has been indicated to be at 407, Marshall House; 25, strand Road, Kolkata-700 001. The petitioner relied on the agreement of february 14, 2003 in the statutory notice and claimed that it exported goods to the company thereunder and that a principal sum of Euro 3916. 47 remained due. The company responded by a letter of March 7, 2005, The companys response was to two SKF entities that had issued separate notices through the same Advocate claiming from the company. 47 remained due. The company responded by a letter of March 7, 2005, The companys response was to two SKF entities that had issued separate notices through the same Advocate claiming from the company. It is necessary to see how the companys Advocates described their clients in the reply of March 7, 2005: "our clients: 1) Premier (India) Bearings Limited 407, Marshal House, 25, Strand Road, Kolkata700001. 2) Hitech Bearings Pvt. Limited 407, Marshal House, 25, Strand Road, Kolkata-700001. " (4) SUCH reply while dealing with the present petitioners claim had this to say: "with reference to your letters written to Hitech Bearings Pvt. Limited on instruction of S. K. F. South East Asia and Pacific Pte Limited, Singapore, our clients deny that an amount of Euro 5018. 24 being an aggregate of the principal amount of Euro 3916. 47 and interest @ 2% per month. Our clients state that in view of what has been stated hereinabove the question of making payment to your clients an amount of Euro 5018. 24 being an aggregate of the principal amount of Euro 3916. 47 and interest @ 2% per month amounting to Euro 1101. 77 as from the due date until february 15, 2005 and further interest @ 2% on the principal amount of euro 3916. 47 from February 15, 2005 till payment and/or realization as wrongfully claimed in your purported notice under section 434 of the companies Act, 1956 or any other amount does not and cannot arise. " (5) IN addition to the two paragraphs dealing with the present petitioners specific claim, the company referred to Civil Suit No. 101 of 2004 instituted by premier India Bearings Limited against SKF Bearings India Limited on the original Side of this Court where the associate of the company had claimed on account of alleged loss and damage that it had suffered. The undenying theme of the companys response, one that was carried later in the affidavits filed by it in these proceedings, was that there was an arrangement between two groups and that disputes had arisen following which the companys group had instituted proceedings against the petitioners group. The undenying theme of the companys response, one that was carried later in the affidavits filed by it in these proceedings, was that there was an arrangement between two groups and that disputes had arisen following which the companys group had instituted proceedings against the petitioners group. The company warned in its reply, and cautions in course of final hearing, that it would be unwise to isolate claims of some of the entities to found individual proceedings thereon and the entirety of the matter had to be dealt with as a composite claim and counter-claim. (6) THE parties were not satisfied with the usual sets of pleadings ordinarily filed in such proceedings. Instead of the usual three sets of papers that the court generally looks into to assess a claim and its defence, this bundle consists of seven sets. Upon the first round of pleadings-the petition, the opposition and the reply-having been exhausted, the parties obtained leave to file further pleadings. The company filed a supplementary affidavit running into 135 pages in February, 2007 to which the petitioner used a rejoinder of 16 pages in march, 2007. The petitioner thereafter realised that its rejoinder to the companys supplementary was thin in comparison and obtained leave to file another supplementary affidavit of 51 pages. The company has used a 17-page reply to the petitioners supplementary affidavit. (7) AT first flush, the company sought to resist the admission by asserting the following in its opposition: (i) The arrangement between the parties was between two groups and not restricted to the eo nomine parties to the agreement of February 14, 2003. (ii) The two groups fell out by December, 2003 on account of poaching into the companys (and its associates) domain by other distributors of SKF products and by the SKF group not providing product support. (iii) The company (or the group to which the company belongs) decided not to renew the association from the beginning of January, 2004 and informed the SKF group thus around Christmas of 2003. On January 6, 2004, the two groups discussed parting of ways and modalities were worked out which would appear from an electronic mail message of january 9, 2004 issued by the Premier group (the company and its associates) to the SKF group. On January 6, 2004, the two groups discussed parting of ways and modalities were worked out which would appear from an electronic mail message of january 9, 2004 issued by the Premier group (the company and its associates) to the SKF group. In such communication it appeared that the close out between the parties (or, more accurately, the two groups)envisaged product and warranty support being provided by the SKF group to the Premier group. (iv) By March 24, 2004, the Premier group had issued two messages to the SKF group demanding credit for incentives and other sums due to it which, according to the company, went unheeded. (v) On January 7, 2004, the SKF group in the name of its Indian company issued a public notice in several newspapers announcing that the Premier group were no longer the Authorised Industrial Distributors (AID) of SKF products with effect from January 1, 2004 and were not entitled to use the skf logo in any manner. The company claims that such notice, in effect, ensured that the inventory of SKF products with the Premier group could no longer be pushed for sale as customers stood warned that the manufacturer would no longer be liable on account of any sales by such distributor. (8) THE company claims that rather than the SKF group providing the Premier group logistic and other support to clear inventory of SKF products at the premier group godowns, the companys public notice and its refusal to provide product support ensured that the SKF products "purchased" by the Premier group as distributors would be of no use to the Premier group as customers would be loathe to buy SKF products from such a discredited, and disowned, distributor. The company claims that the Premier group offered that the dud skf inventory at its godowns be "repurchased" by the SKF group and the accounts be settled after giving credit to the incentives and other receivables due to the Premier group, but the SKF group spurned such overtures and insisted on its pound of flesh by asserting the prmcipal-to-principal relationship between the two groups and relying on the undeniable supplies affected to and bills raised on the Premier group. The company insists that it is the totality of the arrangement that has to be seen and the individual notices sent by the individual entities in the SKF group cannot be separately addressed in isolated proceedings as one-off transactions. (9) IN keeping with such tune that the company sang in its original affidavit in these proceedings, the company did not expend much effort in denying the substance of the petitioners claim in the petition. That substance of the petitioners claim is found at paragraphs 7 to 10 of the petition and such averments were dealt with by the company in paragraph 7 of its opposition, in what the petitioner describes as a cavalier and perfunctory treatment of the claim: "7. With reference to paragraphs 7 to 10 of the said petition, save what are matters of record and what appears therefrom, I deny and dispute each and every allegation contrary thereto and/or inconsistent therewith. " (10) THE petitioner suggests that the company virtually admitted the claim in such ineffective denial and no amount of effort in its subsequent pleadings could detract from such apparent admission of the claim. The petitioner submits that the bills relied upon in the petition had not been questioned, the factum of supply was not disputed, the quality of the goods were not questioned and, thus, there is no defence as to the companys liability. The petitioner suggests, as all creditors need to do at such stage of the proceedings, that it is ex debito justitiae entitled to an order of admission and the Court, on the basis of the indefensible stand taken in paragraph 7 of the opposition by the company, had no discretion to exercise in admitting the petition the propriety of the order of winding up that the petitioner seeks can be tested at the subsequent, post-advertisement stage. (11) THE company was probably alive to the fact that no defence had been made out in its opposition as to the substance of the immediate claim. In its supplementary affidavit, the company has thrown in the list of inventories, a copy of the plaint relating to the suit instituted by the flagship company of the companys group against the Indian unit of the SKF group and has relied on a division Bench judgment upholding the Company Judges order in a winding up petition filed by the Indian SKF against the principal Premier. In the subsequent affidavits filed by the parties, some of the documents found in the earlier sets of papers have been repeated and other documents have been relied upon in support of the rival contentions. (12) BUT before the merits of the claim can be gone into, it is the preliminary challenge thrown by the company that has to be assessed. In addition to the facts already narrated, there are two more matters that require mention before the legal question raised, if it is at all only a legal issue, can be taken up. First, there is the companys failure to mention in its opposition that the statutory notice was not received by it at its registered office. Secondly, there is the 32nd paragraph in the companys supplementary, tucked away towards the very end of that affidavit, that has a single sentence objection as to the maintainability of the petition on the ground "that the winding up notice has not been sent to the registered office of the company as mandatorily required (13) UPON the petitioner shrugging off the companys defence on account of its counter-claim with the submission that neither parties in these proceedings has been impleaded in the suit filed by the Premier company and that the claim stood almost admitted by reason of paragraph 7 of the companys opposition, the company now clings on to the point of maintainability urged in its supplementary. The company if says that section 434 (1) (a) of the Companies act gives a rise to a legal fiction and the presumption of inability to pay, even though rebuttable, does not arise in the first place if the legal fiction does not come into play. Such legal fiction, according to the company, does not come into play till the provisions in clause (a) have been strictly and completely complied with. The notice has to be in writing, under the hand of the creditor or its agent and has to be delivered at the companys registered office for the presumption to arise. If any of the pre-requisites were not met, the company suggests, the presumption does not arise. The notice has to be in writing, under the hand of the creditor or its agent and has to be delivered at the companys registered office for the presumption to arise. If any of the pre-requisites were not met, the company suggests, the presumption does not arise. The company asserts that a creditor in such a case is not left without any remedy but it has then to fall back on the general insolvency of the company to seek its winding up but can no longer assert that the company was unable to pay that creditors debt. (14) THE company relies on a Division Bench judgment of this Court of some vintage which defines principles applicable in proceedings of this nature. In the judgment reported at AIR 1954 Calcutta 499 (Bukhtiarpur Bihar Light Railway Co. Ltd. vs. Union of India and Anr.), the creditor had issued a notice of demand on June 6, 1950 to which the company responded on June 10, 1950. The notice of demand was issued, not to the registered office of the company at 135, Canning Street, Calcutta but to. Fraser Road, Patna. There was a subsequent notice issued on June 30, 1950 but such subsequent notice could not be considered for the purpose of the winding up petition as the same had been presented on July 18, 1950, before the period of three weeks had run out from the date of receipt of the subsequent notice. It was in such circumstances that the Appellate Court held as follows: " (13) It appears to us, however, that although the learned Counsel for the appellant did not himself lay much stress on his first point, it is yet a point which must succeed. According to the petition for winding up itself, the registered office of the Railway Company is situated at No. 135, Canning street, Calcutta. That being so, if a notice of demand was to operate as a valid statutory notice under section 163 (1) (i) of the Indian Companies Act, it would have to be delivered to the Company at its registered office. The letter of June 6, however, was addressed to "fraser Road, Patna" which was not the appellant companys registered office. That fact is sufficient to prevent the Union of India from relying upon the notice of 6. 6. 1950, for the purposes of section 163 (1) (i) of the Act. The letter of June 6, however, was addressed to "fraser Road, Patna" which was not the appellant companys registered office. That fact is sufficient to prevent the Union of India from relying upon the notice of 6. 6. 1950, for the purposes of section 163 (1) (i) of the Act. There was indeed a second notice as well which was delivered at the registered office of the appellant company, but that notice was sent only on 30. 6. 1950, and therefore it could not serve as a statutory notice of demand, seeing that the petition for winding up was made on July 18. The interval between the service of the notice of demand and the making of the petition for winding up was less than three weeks. I ought to state here that on behalf of the Union of India, Mr. Kar admitted that there was no statutory notice of demand in the case on which this client could rely and he also informed us that the Court of Appeal had already so held in connection with the application for a stay of the order which is under appeal before us now. (14) But the fact that the Union of India cannot rely upon any statutory notice of demand merely means that no presumptive or constructive liability to pay the debts, as contemplated by section 163 (1) (i) of the Act, is available to the Union. They are at liberty to prove still, in other ways that, in fact, the company was unable to pay its debts within the meaning of Item (v) of section 162. On that question, we listened to an interesting argument from the Bar as to when a company could be held to be unable to pay its debts and as to what the nature of the dispute must be if cases of disputed debts were to be excluded. It seems to me, however, that in view of one special fact in the case, it is unnecessary for us to embark upon an examination of the question debated before us. As I have already said, the demand of the Union of India is for an amount in the neighbourhood of Rs. 6,00,000/ -. Even if the demand of the Bengal Nagpur railway be added, the total would not be more than Rs, 8,00,000/ -. As I have already said, the demand of the Union of India is for an amount in the neighbourhood of Rs. 6,00,000/ -. Even if the demand of the Bengal Nagpur railway be added, the total would not be more than Rs, 8,00,000/ -. Yet, on the admission contained in the petition itself, there is an amount of rs. 10,00,623/- which belongs to the company and it must therefore be available for the payment of the companys debts. In those circumstances, it is quite impossible for the Union of India to contend that although the appellant company has, according to its own case, a sum of Rs. 10,00,623/-waiting to be paid over to it and although the claims of itself and of the Bengal Nagpur railway do not exceed Rs. 8,00,000/-, it must yet be held that the company was unable to pay its debts. In my view, even assuming that the company was deliberately avoiding or delaying payment, this was not a case of inability to pay, but a case where the company was failing and neglecting to pay. I am, by no means, holding that between the first demand and the making of the petition there was any deliberate failure or neglect, because in order to arrive at a decision on that point, a much closer examination of the facts would be necessary than is possible on the very meagre materials which are to be found in the paper book. Suffice it to say, for the purposes of the present case, that when the financial position of the company is such that against the admitted assets of the value of Rs. 10,00,000/- there is a debt of Rs. 8,00,000/-only, it can by no means be said that the company is unable to pay its debts. " (15) THE provisions of the Companies Act, 1913, in the part material for the present proceedings, have been preserved in the subsequent Act of 1956 and the reasons given by the Division Bench on the reading of the 1913 Act continue to hold good after the 1956 Act. " (15) THE provisions of the Companies Act, 1913, in the part material for the present proceedings, have been preserved in the subsequent Act of 1956 and the reasons given by the Division Bench on the reading of the 1913 Act continue to hold good after the 1956 Act. What is of significance is that there was a reply issued by the company to the first statutory notice, whether or not a point was taken therein that such notice was invalid, and despite the company accepting the notice as a statutory demand, the Division Bench held that it could not operate as a valid statutory notice under section 163 (1) (i) of the former Act which is now section 434 (l) (a) in the 1956 Act. (16) THE company has placed a Division Bench judgment of the Bombay High court reported at 1991 (70) Comp. Cas. 31 [n. L. Mehta Cinema Enterprises (P)Ltd. vs. Pravinchandra P Mehta] which followed the Bukhtiarpur Bihar Light railway case. The Bombay High Court noticed that the petition proceeded upon the allegation that the company was unable to pay its debts and such allegation was based on the fiction contained in section 434 of the Companies Act. The notice in that case was sent to the companys administrative office at Wankhede stadium and not to the registered office in Mahim. A Single Judge of the Bombay high Court, relying on rule 33 of the Companies (Court) Rules, 1959 held that the service of the notice could not be deemed invalid on account of it being served at any place other than the registered office provided the Court was satisfied that such service was sufficient in other respects. The Division Bench found that reliance on such Rule was misplaced as the rule related to service under, the said rules and the service of a statutory notice under section 434 was not covered by the rules. The Division Bench opined that the fiction under section 434 (1) (a) was not available to the petitioner and the petition was liable to be dismissed. (17) FOR similar effect, a judgment of a Single Judge of the Madras High court reported at 1992 (73) Comp. Cas. 136 (B. Viswanathan vs. Seshasayee paper and Boards Ltd.) has next been placed by the company. (17) FOR similar effect, a judgment of a Single Judge of the Madras High court reported at 1992 (73) Comp. Cas. 136 (B. Viswanathan vs. Seshasayee paper and Boards Ltd.) has next been placed by the company. In such case the notice was not only addressed to the managing director of the company, it was issued to an office other than the registered office and the Court held that such notice was not in accordance with the mandatory requirements of section 434 and the presumption under that section would not be raised: "under section 434 of the Act, the deemed inability to pay the debts will arise when a creditor to whom the company is indebted in a sum exceeding rs. 500 has served on the company by causing it to be delivered at its registered office a demand notice requiring the company to pay the sum so due, and the company has, for three weeks thereafter, neglected to pay the sum or to secure or compound it to the reasonable satisfaction of the creditor. Unless the statutory notice is in conformity with the mandatory requirements of section 434 (1) (a) of the Act, the presumption of inability cannot be raised. In the present case, the notice is addressed only to the managing director and not to the company. The registered office of the company is at pallipalayam, Salem District, as can be seen from the postal index number code of delivery post offices in Tamil Nadu circle, marked as Exhibit R-6; the pin code number of Pallipalayam is 638 006. The notice purporting to have been issued under section 434 is not only one addressed to the managing director, but also the pin code number given is 638 007. Therefore, the statutory Exhibit P-9 notice does not conform to the mandatory requirements of section 434 (1) (a) of the Act. The consequences of the statutory notice not being in accordance with the mandatory requirements of section 434 of the act is that the presumption contemplated under the said section cannot be raised against the respondent. But that does not preclude the petitioner from still proving by other evidence that the company is unable to pay its debts. That appears to be the view taken in Bukhtiarpur Bihar Light Railway co. Ltd. vs. Union of India. . . " (18) THE Allahabad judgment reported at 1999 (95) Comp. Cas. But that does not preclude the petitioner from still proving by other evidence that the company is unable to pay its debts. That appears to be the view taken in Bukhtiarpur Bihar Light Railway co. Ltd. vs. Union of India. . . " (18) THE Allahabad judgment reported at 1999 (95) Comp. Cas. 436 (Alliance credit and Investments Ltd. vs. Khaitan Hostombe Spinels Ltd.) has been relied upon by the company on the same point. In that case the statutory notice was addressed to the companys office in Calcutta though its registered office was in Kanpur. A Single Judge of the Allahabad High Court held that for a legal fiction to become operative, there should be strict compliance with the conditions therefor. The company had replied to the statutory notice without raising any objection as to the service thereof at an office other than the registered office. But on the strength of the Bukhtiarpur Bihar Light Railway Company reasoning, the winding up proceedings were not received. It was also held that where there was a question of complying with a statutory pre-condition for a legal fiction to operate, there was no question of estoppel or acquiescence or waiver. (19) THE petitioner places reliance on a judgment reported at 2000 WBLR (Cal) 256 (Kadex Systems Ltd. vs. R. K. Swamy/bbdo Advertising Ltd.) and an unreported judgment of August 28, 2002 passed in C. P. 284 of 2000 (In the matter of: Kusum Marketing Ltd. And. Dhanraj Abhani), both rendered by Single judges of this Court. In the Kadax Systems case a notice was issued on April 2, 1996 to the administrative office of the company which was followed by another demand on April 6, 1996, also issued to the administrative office. The company offered to make some payment but upon its failure, a fresh statutory notice of january 6, 1997 was issued, addressed to the managing director of the company at its administrative office. The company replied to such statutory notice through its Advocates. It does not appear that the Advocates expressed any reservation in the reply on the ground of the invalidity of the notice. In resisting the winding up petition, the company urged such ground and despite judgments being cited in support of the challenge to the notice, it was held as follows: "4. Indeed the company had not been served with the statutory notice at its registered office. In resisting the winding up petition, the company urged such ground and despite judgments being cited in support of the challenge to the notice, it was held as follows: "4. Indeed the company had not been served with the statutory notice at its registered office. As I see it, service of the statutory notice of demand on the company at its registered office was a provision contained in the Companies act was not merely a matter of procedure and form. Such provision was a method of ensuring fairplay by and bona fide of the parties to summary proceedings. It was a check on the parties from stealing a march by one against the other. The salient factor which must have weighed on the minds of the legislators in inserting the provision in the Act surely must have been before instituting summary proceedings such as a winding up petition it was mandatory that the company should be made fully aware of its debt and failure to pay within the allotted time would entitle the debtor to institute summary action for winding up of the company. The decisions cited by advocate for the company concerned circumstances, where the company did not receive the statutory notice of demand and the Court was satisfied in that respect or the notice had been served on the Managing Director and the legal fiction of the company being unable to pay its debt did not arise. The circumstances and the facts in the present case were somewhat different. Things did not stop after service of the statutory notice addressed to the managing Director of the company at its administrative office. Admittedly, the statutory notice had been made over to the Advocates on behalf of the company and they replied on behalf of the company which they stated was their client and that they wrote the letter, "with instructions to reply". The address of the company was quoted by its Advocates in their letter of reply as that of the administrative office. In those circumstances, I am inclined to be of the view that holding this application to be bad, merely because the statutory notice had not been served at the companys registered office, would be of little consequence other than wastage of time of this Court and the. In those circumstances, I am inclined to be of the view that holding this application to be bad, merely because the statutory notice had not been served at the companys registered office, would be of little consequence other than wastage of time of this Court and the. parties and unnecessary prejudice of the parties in that they had already incurred costs and expenses which would be of no avail. In short dismissing this application would be quite futile. Assuming the application was adjudged bad in law the application could not be dismissed in limine, the petitioner would necessarily have the liberty to file a fresh application on the same cause of action as in this petition. In its reply to the statutory notice sent by advocate for the company no objection was taken in respect to the service of the statutory notice of demand and, therefore, it would be deemed that the company had full knowledge of both as to its debt and the consequence of failure to pay within the allotted time. Having full knowledge of the contents of the statutory notice of demand and having made it over to its Advocates with instructions to reply the intentions of the legislature had been fully satisfied and the mischief they had sought to protect had been protected. As regards the allegations that the petition was lacking in material particulars, in respect to the bills, and that the bills had not been annexed to the petition nor produced before this Court, I am afraid that such allegations were mere afterthought and with intent to avoid payment of lawful does of the petitioner. In the two letters dated June 25, 1996 and December 18, 1997 the company while admitting the claim and assuring the petitioner of payment did not mention anything about its alleged lack of knowledge as to the bills, or particulars of the claim. Significantly, there was also not a whisper in respect in the reply to the statutory notice which had been sent on behalf of the company by its Advocates. Significantly, there was also not a whisper in respect in the reply to the statutory notice which had been sent on behalf of the company by its Advocates. The decisions which were cited by Advocate for the company being 45 Company Cases 534, AIR 1952 Calcutta 323 and AIR 1960 Madhya Pradesh 272 where the Courts had found that the petition must itself disclose the cause of action, must contain the necessary particulars from which the Court can ascertain that there was in fact a debt, that a statutory notice had been served and that there had been a default. The Courts have of course held over the years that in order to resist an order for winding up there must be a bona fide dispute by the company and not a mere moonshine or a sham. In the instant facts and circumstances it was abundantly clear from the letters of admission, to which I have referred earlier in this order that the company was indebted to the petitioner for the sum of Rs. 6,17,536. 79 and I have no hesitation to hold that the defence sought to have been made out on behalf of the company, was wholly in substantiated and less than bona fide. In fact, Advocate for the company made his submissions principally on non-compliance by the petitioner of mere forms and procedure in making this application. There was no substance or merit in the alleged defence of the company. " (20) IN the other case cited by the petitioner, the creditor had ascertained from the Registrar of the Companies as to the location of the registered office of the company and the Registrar had confirmed that the companys registered office was at 9, Brabourne Road, Calcutta. The companys subsequent assertion that its registered office stood shifted in the year 1988, was disbelieved. The case is not an authority for the proposition that there would be compliance with the provisions of section 434 (1) (a) of the Act if the company had received the demand, irrespective of such demand being delivered at a place other than its registered office. (21) MOST of the cases on this aspect, and some more, were considered in an unreported judgment of May 19, 2003 passed by a Single Judge of this Court in c. P. No. 235 of 2002 (In the matter of: Diabari Tea Company Limited). (21) MOST of the cases on this aspect, and some more, were considered in an unreported judgment of May 19, 2003 passed by a Single Judge of this Court in c. P. No. 235 of 2002 (In the matter of: Diabari Tea Company Limited). In dealing with the Kadex Systems judgment, it was held as follows: "to maintain a winding up petition a creditor has to show that he has a just debt due which the company is unable to pay. The company is deemed unable to pay in case notice under section 434 is given at the registered office of the company and the company has failed and neglected to pay such sum within 21 days from the date of receipt. Such presumption of insolvency is a rebuttable one and the company is entitled to rebut such presumption by raising bona fide dispute. In the instant case the petitioner admittedly served notice at a place which was not the registered office of the company. Hence, the petitioner was not entitled to take the plea of deemed insolvency under section 434 of the said Act. Hence, the plea that there had been an appropriate notice served by the petitioner was not tenable and the Single Bench decision of this Court reported in 2000 WBLR (Calcutta) 256 was not a good law and with all humility I am unable to agree with His Lordship. " (22) IN view of the binding Division Bench precedent in the Bukhtiarpur bihar Light Railway case, which was not noticed in the Kadex Systems case, there is no room for any discretion in the matter or room for making allowances for service of the statutory notice at any place other than the registered office of the company. The statutory notice has per force to be issued to the company and has to be delivered at its registered office before a creditor can allege deemed insolvency of a company in terms of section 434 (1) (a). Indeed, it is a jurisdictional fact that has to be complied with for a creditor to urge that the company is unable to pay its debts. The companys conduct is immaterial as there is no question of any waiver by the company in case the notice is delivered elsewhere. Indeed, it is a jurisdictional fact that has to be complied with for a creditor to urge that the company is unable to pay its debts. The companys conduct is immaterial as there is no question of any waiver by the company in case the notice is delivered elsewhere. It is for the petitioner to satisfy the Court that the conditions precedent to the invocation of the legal fiction had been complied with. (23) BUT the statutory pre-condition cannot be taken to an illogical extreme. It is one thing to challenge a notice on the ground of it having been issued to an administrative or other office and quite another to suggest that a notice addressed to a different room or suite number at the same building should entail a similar fate. In the Bukhtiarpur Bihar Light Railway case, the creditor missed the registered office by a state, instead of it being despatched to Canning street, Calcutta, it was sent to Fraser Road, Patna. In the Bombay case, the notice was not addressed to the registered office in Mahim but to an office at wankhede Stadium, several kilometres to the south. The Allahabad judgment was in the context of the notice having been issued to an office of the company in Calcutta rather than at the registered office in Kanpur. In the Diabari Tea company Limited case there was a change of the registered office and the notice was issued to the old registered office. In the Madras case, the notice was delivered in the name of the managing director at Erode instead of being served at registered office at Pallipalayam, Salem district. But here we have the notice issued to Marshall House, Strand Road where the registered office of the company is situated but to room or suite No. 407 instead of No. 471. (24) THE Bukhtiarpur Bihar Light Railway test is not so inflexible so as to not allow for such minor discrepancy. The strict compliance with the legal fiction has also to be appreciated m the context of another limb of section 434 (1) (a) of the Act. The expression "a demand under his hand" also in clause (a) has been understood to include a demand made by an authorised agent of the creditor. The strict compliance with the legal fiction has also to be appreciated m the context of another limb of section 434 (1) (a) of the Act. The expression "a demand under his hand" also in clause (a) has been understood to include a demand made by an authorised agent of the creditor. If the test for the invocation of the legal fiction were to be as strict as the company suggests, there could have been no relaxation of such other limb of section 434 (1) (a). (25) IT is the substance of the defence which has to be tested upon the technical objection having failed. The petitioner presents the claim in simple terms: goods were supplied, bills were raised, there was no dispute on quality or rate and the company has raised no dispute in respect of the transactions. If such were the only facts relevant for the purpose of adjudication, the petitioner would be entitled, as of right, to have the petition admitted. In the two stage system followed in creditors winding up petitions in this Court, upon an indisputable claim being established, there is little room for discretion and the matter must progress to the next stage. (26) THE consequence of a petition being permitted to proceed to the second stage has to be appreciated. Upon a creditors petition being admitted, the Court ordinarily permits the company to pay off what, on a prima facie basis, appears to be the sum due to the creditor, or to secure such claim. The Court does not necessarily direct payment or call for security, but merely gives the company an option so that advertisements may be warded off. A company may choose to suffer advertisements and stay back to challenge the prima facie finding of its inability to pay, at the final stage. It is open to the company to dislodge the prima facie view of its indebtedness to the creditor taken at the initial stage or to otherwise convince the Company Judge that no order of winding up should be made. At this, the second stage, the Company Judge also has the benefit of others being present who may support or oppose the prayer for winding up. At this, the second stage, the Company Judge also has the benefit of others being present who may support or oppose the prayer for winding up. Even if the creditors debt remains undisputed, there is still a discretion at large which the company Judge may exercise and decline to make an order for winding up despite finding the creditor to be entitled to a sum in excess of the statutory floor limit. (27) DESPITE the tentative nature of the finding as to indebtedness at the first stage, companies have generally been found to take up the Courts after to pay off or secure the claim to avoid the prejudice of the petition being advertised. Upon advertisements, the matter is no longer restricted to the solitary claim of the petitioning creditor. Other joining in have equal right to demand payment as the petitioning creditor and the Company Court has to provide for payment of all the supporting creditors if the Company Court is not of opinion that despite the companys indebtedness, there are other grounds to decline the order of winding up. At the second stage, the petition partakes a representative character. (28) ALONG with the supporting creditors who may line up after advertisements, the company also suffers the extreme prejudice of the petition being, effectively, a warning to others who may deal with the company. It is probably on account of such prejudice that a company is likely to suffer upon advertisement, that the two-stage procedure has been adopted by this Court. It is also such prejudice, and the eagerness to avoid it, that prompts companies to pay up or secure without taking a chance to let the matter progress to the final stage. The burden of such consequence of advertisement sits heavy on the company Judge. The prima facie adjudication as to the companys indebtedness to the petitioning creditor is thus more firm and less tentative than the expression "prima facie" generally connotes. The order of admission, in a sense, pushes the company to the brink. The advertisement is slur on its reputation. It is an invitation to other creditors to jump on the bandwagon. It has a suffocating effect on the company, affecting its goodwill and commercial credibility. The order of admission, in a sense, pushes the company to the brink. The advertisement is slur on its reputation. It is an invitation to other creditors to jump on the bandwagon. It has a suffocating effect on the company, affecting its goodwill and commercial credibility. Yet, it is only a prima facie view of the companys indebtedness to the particular creditor that is taken at the receiving stage so that, upon further material being produced by the company at the next stage, such view can be dislodged; or, the Court exercises its discretion to not send the company into liquidation on other considerations. Technically, though, there is no bar to the claim being agitated afresh at the second stage without any additional material, but in practice few companies consider it worth their while to undertake such exercise. (29) THE company here emphasises that the petitioner relies on the same agreement that is the subject-matter of the suit filed by the companys associates against the Indian SKF. The company reminds that the petitioners claim forms part of the accounts that have been referred to in the early-2004 correspondence between the two groups. The company refers to the Premier groups demands for incentives and other receivables being adjusted against the price of the overall supplies effected by the SKF group. The company exhorts that the plaint in the suit filed by the Premier concern against the Indian SKF should be read as a claim by the Premier group against the SKF group and that the other entities of the two groups are not parties to such suit, should not prompt the court to give it a more constricted meaning than it deserves. (30) FOR the proposition that if accounts had not been taken, an isolated claim could not be made the basis of winding up proceedings, an unreported judgment of May 3, 2007 passed in C. P. No. 180 of 2006 (In the matter of: Alam Tannery Private Limited)is placed with Counsel confirming that the judgment has stood the test in appeal. That part of the unreported judgment is referred to where it has been held that not only should there be a debt due, the quantum of indebtedness needs also to be established: "there is good reason for the Company Court requiring the quantum of indebtedness being established before it permits a creditors petition for winding up to proceed. That part of the unreported judgment is referred to where it has been held that not only should there be a debt due, the quantum of indebtedness needs also to be established: "there is good reason for the Company Court requiring the quantum of indebtedness being established before it permits a creditors petition for winding up to proceed. For one, even though the floor limit set by the provisions of the Companies Act is a meagre Rs. 500/-, it would be unfair to subject a functioning company to the attendant miseries upon a winding-up petition being admitted merely on the Company Judges subjective assessment of the quantum of debt being in excess of Rs. 500/ -. Secondly, it is open to a company to secure a claim and such option presupposes an amount being determined. Thirdly, in the practice followed by this Court where a winding up petition is considered at two stages, the usual order passed is one permitting the company to pay or secure the amount, prima facie found due, so that advertisements do not ensue and the matter does not progress to the second, and more prejudicial, stage. If the Company Judge is unable to ascertain the sum that is due to the petitioner, albeit prima facie, then no condition for avoiding publication of advertisements can be set. " (31) IN addition to the immediately grounds urged by the company, there are equitable considerations which come into play in a creditors winding up action. On the one hand, the Company Court cannot be used as a debt collecting Court; on the other, a company cannot deny payment merely upon the company citing a dispute without establishing the bona fides thereof. The Company Court can shoo a creditor away if it finds that the companys inability to pay is on account of the creditors conduct. Courts have frowned upon creditors arm-twisting companies in such proceedings and have branded them as scandalous. There is no doubt that the petitioner in this case has been able to establish that supply of the goods was affected, bills were raised and there was no disputes as to quality or quantity or rate. And yet there would be at least three grounds on which this petitioner can be stopped in its tracks. There is no doubt that the petitioner in this case has been able to establish that supply of the goods was affected, bills were raised and there was no disputes as to quality or quantity or rate. And yet there would be at least three grounds on which this petitioner can be stopped in its tracks. The first is the undeniable impression from the papers relied upon that the petitioners supply to the company was but a part of the overall transactions between the two groups of concerns. The second is the Premier groups claims for incentives and other receivables; in substance, a defence that accounts had not been taken and that the petitioners claim could not be isolated without apportionment therefrom on account of incentives and other receivables due to the company. (32) THE third is the equitable consideration. It is true that the petitioner did not issue the advertisement in the year 2004, but such advertisement covered all SKF products of which the petitioners supplies were a part. The company, or the Premier group, did not enter into the distributorship agreement, albeit on principal-to-principal basis, for their own consumption of the goods. The premier group was to sell the SKF bearings and other components to end users. The SKF warnings in newspapers, it can be reasonably argued, drove customers away from the companys counters where SKF products were on sale. The counter-claim of damages set up by the company is not altogether absurd. The fact that there is no direct action between the dramatis personae here in respect of the companys claim for damages, is not good ground by itself to discredit the counterclaim. (33) THAT is not to say that the entirety of petitioners claim, or the claims of the other entities in that group, can be wished away by the defence that has been set up. The companys group appears to be debtors of the petitioners group. But it would be unwise to single out one undisputed bill, or three as in this case, for a claim in summary proceedings to be founded thereon, unmindful of the other matters that need to be resolved in the overall transaction. To yield to the petitioners request in this case would be to prompt it to arm-twist the company into submitting to an inequitable demand in the context of the larger picture. To yield to the petitioners request in this case would be to prompt it to arm-twist the company into submitting to an inequitable demand in the context of the larger picture. (34) THE rival claims of the parties have to be assessed in more protracted proceedings. The claim of the petitioner, attractive as it is, is relegated to a suit. The petition is permanently stayed. The parties should bear their own costs. (35) URGENT photostat certified copies of this judgment, if applied for, be issued to the parties upon compliance with requisite formalities.