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2013 (11) TMI 1348 - HC - Companies LawStay application - Winding up of a company - Inability to pay debts - Held that:- winding up proceeding is not a recovery proceeding for enforcing the recovery of the debt. It is not a tool to realise the debts due from the company, nor could be taken out to exert the pressure on the company to pay the dues. The debt must be of an ascertained and/or definite sum. If there is some bona fide disputes so raised, the proper course which the Company Court should adopt is to relegate the parties to a regular civil proceeding. Furthermore, the financial solvency of the company should also be taken in mind in discharging the admitted liability and raising a bona fide disputes. company has paid off the entire principal amount, may be after the winding up petition is advertised. All the creditors who appeared at the post advertisement stage including the present creditors have been paid in entirety. It is only the dispute relating to the payment of interest which is left to be considered in the winding up proceeding. From the admitted fact that the company have paid the entire principal amount, it is demonstrated that the company is otherwise financially solvent and that its continuance in operation would not effect the public at large. Except from a stray statement that the company has pleaded the waiver of the interest, there is no contemporaneous document forthcoming before the Court which would lead to an inevitable conclusion that the company has agreed to pay the interest as claimed by those secured creditors - The application under Section 466 of the Companies Act is allowed, meaning thereby that the winding up petition shall remain permanently stayed - Stay granted.
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