Inability to pay debts supported winding up where unpaid bill discounting liability and no effective opposition were shown.

An unpaid bill discounting liability, followed by service of statutory notice under the Companies Act, supported a winding-up petition against the respondent-company. The petition had earlier been admitted on a prima facie finding that the company was unable to pay its debts and was ordered to be advertised under the Companies (Court) Rules, 1959. After advertisement, no effective opposition was pressed on behalf of the company. The High Court therefore found the respondent-company liable to be wound up and allowed the winding-up prayer.

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Issues: Whether the respondent-company was unable to pay its debts and liable to be wound up on the winding up petition.

Analysis: The petition was founded on an unpaid bill discounting liability followed by service of statutory notice under the Companies Act. The petition had earlier been admitted on a prima facie finding of inability to pay debts and was ordered to be advertised under the Companies (Court) Rules, 1959. After advertisement, no effective opposition was pressed on behalf of the respondent-company.

Conclusion: The respondent-company was found liable to be wound up, and the winding up prayer was allowed.

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