High Court Upholds Winding Up Petition, Restrains Asset Transfer - Final Payment Opportunity Granted

The High Court upheld the admission of the winding up petition against the appellant company, appointing the official liquidator as provisional liquidator. The court restrained the appellant from transferring assets except to meet liabilities owed to the respondent. Despite past failures to pay outstanding debts, the court granted a final opportunity for payment in installments, considering the impact on workers. Failure to comply would result in immediate enforcement of the winding up order.

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Issues:
- Admission of winding up petition against the appellant company
- Appointment of official liquidator as provisional liquidator
- Restraining appellant from dealing with assets
- Extension of time for payment of outstanding debts
- Failure of appellant to pay outstanding debts
- Consideration of final opportunity for appellant to pay outstanding liability
- Impact on workers due to winding up proceedings

Admission of Winding Up Petition:
The High Court upheld the order admitting the winding up petition against the appellant company and appointing the official liquidator as the provisional liquidator. The court restrained the appellant from transferring any assets except to meet liabilities owed to the respondent and day-to-day expenses.

Extension of Time for Payment:
The appellant sought an extension to pay outstanding debts in three monthly installments. Despite previous failures to pay, the court granted a final opportunity for the appellant to liquidate the outstanding liability by a specified date, considering the impact on workers if winding up proceedings continued.

Failure to Pay Outstanding Debts:
The respondent argued against granting further indulgence to the appellant, citing past failures to pay despite extensions and undertakings. The Company Court initiated contempt proceedings due to breach of undertakings, leading to the admission of the winding up petition.

Final Opportunity for Payment:
The High Court granted an extension for payment of outstanding debts until a specified date, subject to the appellant making timely payments as proposed. The appellant's readiness to pay and the undertaking to abide by the new schedule influenced the court's decision.

Impact on Workers:
Considering the potential adverse effects on approximately 300 workers employed by the appellant company, the court weighed this factor in granting the extension for payment of outstanding debts.

In conclusion, the High Court dismissed the challenge to the order admitting the petition, upheld the consequential directions, and extended the time for payment of outstanding debts subject to specified conditions and undertakings by the appellant. The court emphasized that failure to comply with the payment schedule would render the Company Court's order immediately operative.

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