Winding up jurisdiction cannot be used for a bona fide disputed interest claim, and an admitted debt offered for timely payment will not justify winding up.

Winding up was held inappropriate where the company admitted the principal debt and undertook to pay it within the time fixed by the Court, because such readiness to pay meant there was no neglect of payment sufficient to support winding up. The Court also treated the interest claim as bona fide disputed and therefore unsuitable for determination in winding up jurisdiction, leaving the claimant to pursue a civil suit for that component. The petitions were disposed of by directing payment of the admitted principal sum within the stipulated time and declining winding up on the disputed interest claim.

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Issues: (i) whether winding up could be ordered in respect of the admitted principal amount payable by the company; (ii) whether the disputed claim for interest could justify winding up.

Issue (i): Whether winding up could be ordered in respect of the admitted principal amount payable by the company.

Analysis: The principal liability was not in dispute and the company expressed readiness to pay the admitted amount by demand draft within the time fixed by the Court. In winding up jurisdiction, where the admitted debt is agreed to be paid within the period granted, the company cannot be treated as having neglected payment so as to attract a winding up order.

Conclusion: Winding up was not ordered on the basis of the admitted principal amount, and time was granted for payment.

Issue (ii): Whether the disputed claim for interest could justify winding up.

Analysis: The claim for interest was specifically disputed and the Court found a bona fide dispute on liability. A winding up petition is not an appropriate forum for adjudication of a genuinely disputed claim for interest, and the petitioner was left at liberty to pursue a civil suit for such claim.

Conclusion: The disputed interest claim did not justify winding up.

Final Conclusion: The company petitions were disposed of by directing payment of the admitted principal sum within the stipulated time and declining winding up on the disputed interest claim.

Ratio Decidendi: Winding up jurisdiction cannot be invoked where the debt claimed is bona fide disputed, and an admitted amount offered to be paid within the time granted does not warrant a winding up order.

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