Company fixed deposit

Kunal Shah (Querist) 14 January 2013 This query is : Resolved
Dear All,

In a situation where a listed company defaults on paying interest on time;

1) Is it better to go to Company Law Board first or should the depositor file a Winding Up Petition?

2) Can the depositor ask the CLB for a list of all FD holders with that company, so they may form an association and lodge a complaint with CLB, or as a group, file a Winding Up petition?

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Raj Kumar Makkad (Expert) 14 January 2013
१. Go to Company Law Board first.

2. A petitioner should confine only with his problem and CLB shall not facilitate such information.

Kunal Shah (Querist) 14 January 2013
Dear Mr. Makkad, thank you for the prompt response. So should the investor go to CLB first or should he first file winding up petition, or should he do both?

Devajyoti Barman (Expert) 14 January 2013
The investor can go to consumer forum as well if the listed company is a nbfc.
CLB proceeding and winding up both can not be initiated.

Kunal Shah (Querist) 15 January 2013
Thank you Mr. Barman!

My friend's lawyer has suggested that he go straight for Winding up petition, but I think he should go to CLB because I believe CLB has the power to pull the MD and directors and demand a reply alongwith a commitment to pay the sums if the company is solvent. Your views?

It is a Public Limited company listed on the stock exchange, and is into mechanical engineering.

Kunal Shah (Querist) 15 January 2013
Further to earlier query, can the investor go to the CLB for default in interest payment?

He requested premature redemption after the default in interest payment, and the company has not reverted to any of his communication.

V R SHROFF (Expert) 15 January 2013
Issue winding up/ liquidation notice. Co will response immediately.

Raj Kumar Makkad (Expert) 15 January 2013
It is not a wise step to incur a lot of amount for going to high court for winding up proceeding against a company which even can be got handled by CLB even without any charge.

ajay sethi (Expert) 15 January 2013
if company has defaulted in payment of interest issue winding up notice . it may work and save you the labour of going to court

Kunal Shah (Querist) 15 January 2013
@VR Shroff - I learned today morning that someone else has already filed Winding Up Petition to the company;
*) Would it help if a second notice is served?
*) Would only those creditors who serve a Winding Up notice, get their dues?

@Raj Kumar Makkad - Many thanks!

@Ajay Sethi - Are you referring to a letter from the investor's advocate to the company's MD and Board? I believe if one wants to file a Winding Up Petition then he has to go to court?

Raj Kumar Makkad (Expert) 15 January 2013
If one has to file for winding up, he has to approach high court and in this case, such petition has already been filed so better become a party to that petition.

V R SHROFF (Expert) 15 January 2013
I said to issue notice, not to go to HC & spend.

Agree with Shri Makkad/ Shri Ajay, to join as party, id HC proceeding started.