Admitted debt in winding-up proceedings: disputed interest and unquantified damages claim cannot defeat the principal liability.

An admitted principal debt may still support winding-up proceedings where the debtor's objections relate only to disputed interest and an unquantified counter-claim for damages. A bare assertion of damages, without an existing quantified claim, does not amount to a bona fide defence against the admitted liability. Disputes over interest and damages were treated as matters for the appropriate forum and did not justify resisting payment of the principal debt. Deposit of the admitted principal amount was treated as discharge to that extent, and a civil court injunction was regarded as unable to obstruct the High Court proceedings. The petition was closed, with withdrawal of the deposited amount permitted and the interest and damages issues left open.

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Issues: Whether the winding-up petition could be maintained in view of the admitted debt, the disputed interest claim, and the respondent's asserted counter-claim.

Analysis: The respondent had admitted liability for the principal sum, and the plea of counter-claim for damages was not substantiated by any existing quantified claim so as to constitute a bona fide defence to the winding-up petition. The Court held that the dispute over interest and the alleged damages claim were matters to be agitated before the appropriate forum and did not justify resisting the admitted debt. The deposit of the admitted principal amount in court showed discharge of the debt to that extent, and the injunction obtained from the civil court was treated as incapable of obstructing the proceedings before the High Court.

Conclusion: The winding-up petition was not pursued further and was closed after permitting the petitioner to withdraw the deposited amount, with the interest and damages issues left open for adjudication elsewhere.

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