Unfiled arbitration award may prove a presently payable debt in winding-up proceedings; section 32 does not bar the petition.

An unfiled arbitration award can still evidence a presently payable debt for winding-up purposes under sections 433 and 434 of the Companies Act, 1956, because such a petition is a representative proceeding in rem and not a suit to enforce the award. The Company Court only makes a prima facie enquiry into the existence of the debt and whether the company has raised a bona fide dispute. Section 32 of the Arbitration Act, 1940 does not bar reliance on the unfiled award, since the petition does not seek to enforce, modify, or set aside the award. The winding-up order admitting the petition was therefore sustained.

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Issues: Whether a winding-up petition could be maintained on the basis of an unfiled arbitration award, and whether section 32 of the Arbitration Act, 1940 barred such recourse.

Analysis: The debt for the purpose of sections 433 and 434 of the Companies Act, 1956 must be presently payable. An unfiled award is not a mere nullity or waste paper; it has legal force, creates rights between the parties, and constitutes evidence of the liability until set aside. A winding-up petition is a representative proceeding in rem and is not equivalent to a suit or to enforcement of the award. The Company Court does not decide the award finally, but only examines prima facie whether the debt exists and whether the company has raised a bona fide dispute. On that footing, section 32 of the Arbitration Act, 1940 does not bar a winding-up petition founded on an unfiled award, because the petition does not seek to enforce, modify, or set aside the award.

Conclusion: The unfiled award could be relied upon as proof of a presently payable debt for winding-up purposes, and section 32 did not prohibit the petition.

Final Conclusion: The appeal failed and the order admitting the winding-up petition was sustained.

Ratio Decidendi: An unfiled arbitration award, though not enforceable as a decree, may constitute evidence of a presently payable debt for a winding-up petition, because such a petition is not a suit and does not amount to enforcement of the award within section 32 of the Arbitration Act, 1940.

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