Winding up petition admitted where the company admitted dealings, dishonoured hundis, and failed to support its defence.

A winding up petition under section 439 of the Companies Act, 1956 was admitted because the respondent-company admitted the dealings and the dishonour of the hundis. Its defence that the supplied goods were defective was found vague, and it failed despite opportunities to produce latest balance-sheets to support its financial position. A later plea of labour trouble and paralysed operations did not dislodge the creditor's case at the admission stage, so the petition was admitted.

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Issues: Whether the winding up petition under section 439 of the Companies Act, 1956 should be admitted.

Analysis: The respondent-company admitted the dealings between the parties and also admitted that the hundis had not been honoured. Its explanation that the supplied goods were defective was vague, and despite opportunities it failed to produce the latest balance-sheets to show its financial position. The subsequent assertion of labour trouble and paralysed operations did not displace the creditor's case at the admission stage.

Conclusion: The petition was admitted.

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