Winding-up jurisdiction cannot enforce a bona fide disputed interest claim where no admitted debt is established.

A winding-up petition under section 433(e) could not be used to recover a disputed interest claim where the petitioner failed to establish an admitted or determined debt. The company had consistently denied liability for interest and disputed the rate claimed, while the principal amount was paid during the proceedings. Because the interest demand was raised only in the statutory notice and had not been acknowledged earlier, the court treated it as a bona fide disputed claim. Winding-up jurisdiction cannot substitute for ordinary civil recovery proceedings, and the record did not show insolvency or mala fides, so the petition was dismissed.

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Issues: Whether a winding-up petition under section 433(e) of the Companies Act, 1956 could be maintained for recovery of a claimed interest amount when the underlying debt had been paid during the proceedings and the interest claim was disputed.

Analysis: A petition under section 433(e) lies only where the company is unable to pay its debt, and the petitioner must first establish the existence of a debt. The claimed interest was neither a determined nor an admitted amount, and the company had consistently disputed liability to pay interest as well as the rate claimed. The record showed that the claim for interest was raised for the first time in the statutory notice and had not been acknowledged in the earlier correspondence. In winding-up jurisdiction, a genuinely disputed claim cannot be used to compel payment, and the court will not treat such proceedings as a substitute for ordinary civil litigation. The court also noted that the company had already paid the principal amount during the proceedings and that the material did not show mala fides or insolvency.

Conclusion: The interest claim had not been established as a debt and was bona fide disputed. The winding-up petition was not maintainable and was dismissed.

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