Asian Electronics clarifies on the Global Trade Finance petition

Asian Electronics Ltd (AEL) has clarified to as under:

"1. We have come across a news item / ticker in electronic media (mainly in CNBC TV18) stating that a winding-up petition is filled by Global Trade Finance Ltd against Asian Electronics Ltd for alleged default of repayment of about Rs 2 crores.

2. The Company has received a Notice Bearing No. Mum/9115/3241/2007 dated November 02, 2007 from the above party through their Advocates, M/s. Paras Kuhad Associates pursuant to the provisions of Section 433/434 of the Companies Act, 1956. The said Notice and other relevant papers were submitted to our Solicitors for taking suitable action.

3. Since the matter is sub judice, we would not like to enter into any correspondence except saying that all the actions taken by the above Company are baseless and frevolous. Company will take all the actions to defend itself through proper channel.

4. Since the Agreement provided for arbitration, a Sole Arbitrator has been appointed by Global Trade Finance Ltd. (GTF), who will adjudicate the rival claims between the parties.

5. Basically the dispute has arisen with regard to interpretation of Global Accounts Receivable Management Agreement, i.e. a Factoring Agreement regarding bills discounted with a U.S. party for the sum of US$ 573009.

6. It may please be noted that as per the said Agreement, Credit Protection was specifically offered. Thus, the debtors' risk was covered under the Credit Protection upto 90%. Thus the risk was assumed by GTF and the Client Credit Risk Limit is 10% on AEL Account. The Company has yet to receive balance 15% from GTF.

7. GTF has not received payment from the said U.S. customer and it is wrongfully claiming the entire payment from AEL though AEL is protected under 90% Credit Protection.

8. GTF failed and neglected to protect the interest of its client viz. AEL, inspite of having factored the receivables and taken the responsibility of collection and received the charges thereof. In spite of pending Arbitration and without having due regards for the pendency of the same, GTF has filed this misconceived Winding up Petition.

9. The Company is legally advised that the Company has substantial defence to the Winding up Proceedings and Arbitration Proceedings.

10. The aforesaid facts are conveyed with a view to keep the Stock Exchange and all stake holders duly informed as the Company believes in maintaining highest standards of integrity, transparency and uprightness."