I am a supplier of stationery goods. I have been supplying material to a private limited company that has not been paying my dues since April 2003. However, it has confirmed my outstanding dues on March 31, 2003, by issuing a statement. I have come to know that it is in a poor financial condition. It has now started procuring goods from new suppliers. Due to non-payment I have been forced to stop supply since June this year. How can I recover my dues?

Name and address withheld

 

Under section 439 of the Companies Act 1956, a creditor can file an application to the high court for the winding up of a company. Under section 433 of the Act, the court may wind up a company on the ground of inability on the part of the company to pay its debts. If you have served a demand notice on the registered office of the company in relation to your dues and the company has failed to act on such, then the company will be deemed unable to pay its debts. The statement wherein the company has confirmed its outstanding dues can be used as admission of its liability to you. You should also see if you could produce any correspondence wherein it would be evident that the company is in financial distress. A clear statement of particulars with respect to your dues would also be necessary. However, you must find out where the registered office is located and file the winding up proceedings before the appropriate high court.