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2014 (2) TMI 924 - DELHI HIGH COURTWinding up of company - Inability to pay debts - Respondent has failed and neglected to pay the invoices raised by the petitioner for the goods supplied by the petitioner to the respondent - Held that:- in the present case there was no corresponding credit note issued by the petitioner and therefore the debit note which has been issued by the respondent could not be stated to have been accepted. It is common accounting knowledge that a debit note only represents a debit entry made by a party in the account of another party maintained in its books of account. In other words a party who decides to debit an account of another party would issue a debit note to enable the other party to pass a corresponding entry in its books. Similarly a credit note is issued if the account of the other party is credited. Both credit notes and debit notes are primary vouchers representing entries in the books of accounts. A unilateral issue of debit note would, obviously, not by itself extinguish a debt. However, a debit note would indicate that the party issuing the debit note has debited the account of the other party in its books. The debit note issued in the present case represents a claim that had been made by the respondent on account of alleged defective goods. It is not disputed that it is a contemporaneous document, which had been issued much prior to the filing of the present petition or the issuance of notice under Section 433(1)(a) - Decided against Petitioner.
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