Case Law Details
Arabian Oilfield Suppliers & Services Vs Greka Drilling (India) Limited (Delhi High Court)
Arabian Oilfield Suppliers & Services (the petitioner) filed a winding-up petition against Greka Drilling (India) Limited (the respondent) in the Delhi High Court. The petition was based on the respondent’s failure to pay outstanding dues totaling US$ 723,193.03. The respondent, engaged in providing drilling services for the oil and gas sector, had placed purchase orders with the petitioner for the supply of casing materials. Despite the petitioner supplying the goods as per the orders, the respondent did not make full payment, leading to the initiation of legal proceedings.
The petitioner claimed that except for a partial payment of US$ 147,111.66 made in instalments, the respondent did not fulfill its payment obligations. Despite assurances from the respondent, no further payments were made. A statutory legal notice demanding payment was sent, but the respondent failed to respond or comply. Consequently, the winding-up petition was admitted by the Delhi High Court, and the Official Liquidator was appointed.
However, the proceedings did not progress beyond the appointment of the Liquidator, indicating that they were still at a nascent stage. The respondent challenged the petition, arguing that as a foreign company, it was not subject to winding-up proceedings. The court directed both parties to address the issue of whether the petitioner complied with the conditions prescribed in Section 583 of the Companies Act, 1956, concerning the respondent’s status as a foreign company not registered in India.
Section 583 of the Companies Act, 1956, provides for the winding up of unregistered companies. Since the respondent fell under this category and was unable to pay its debts, the court deemed the winding-up proceedings maintainable. The court cited previous judgments and legal provisions to support this view, emphasizing the jurisdiction of Indian courts over foreign companies operating within the country.
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