Decretal debt and winding up: decree-holder need not exhaust execution first, and limitation runs from the decree itself.

A decree-holder may present a winding up petition on a decretal debt without first exhausting execution proceedings or obtaining an unsatisfied return. Where the petition is founded on the decree itself, limitation runs from the enforceability of the decree, not from the original cause of action, and the petition was held within time. The respondent's failure to satisfy the decree, together with admissions of financial inability, lack of income, and absence of business, established commercial insolvency and inability to pay debts. The maintainability and limitation objections were rejected, and the winding up petition was admitted with interim protective orders.

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Issues: (i) Whether a decree-holder must first exhaust execution proceedings or obtain an unsatisfied return before presenting a winding up petition on a decretal debt; (ii) whether the petition was barred by limitation; (iii) whether the respondent was shown to be commercially insolvent and unable to pay its debts.

Issue (i): Whether a decree-holder must first exhaust execution proceedings or obtain an unsatisfied return before presenting a winding up petition on a decretal debt.

Analysis: A decree-holder may proceed under the company law remedy without first proving that execution has failed. The existence of a decree did not make the petition incompetent, and the court distinguished authority dealing with void decrees and insolvency law principles that were inapposite to company winding up. The petition was based on a decree debt, not merely on the underlying claim.

Conclusion: The objection to maintainability failed and was rejected in favour of the petitioner.

Issue (ii): Whether the petition was barred by limitation.

Analysis: Where the winding up petition is founded on a decretal debt, limitation is governed by the period applicable to enforcement of the decree, not by the period applicable to the original debt. The court treated the decree as enforceable for twelve years and held that the petition was within time, including on the alternative reckoning from the dismissal of the application to set aside the ex parte decree.

Conclusion: The limitation objection failed and was rejected in favour of the petitioner.

Issue (iii): Whether the respondent was shown to be commercially insolvent and unable to pay its debts.

Analysis: The respondent did not dispute liability in substance, failed to satisfy the decretal demand, and its reply contained admissions of financial inability, lack of income, and absence of business. The court held that these facts established inability to pay debts and left no bona fide or substantial defence to the petition.

Conclusion: Commercial insolvency and inability to pay debts were established in favour of the petitioner.

Final Conclusion: The winding up petition was admitted, interim protective orders were granted, and the matter was directed to proceed further, with the petitioner obtaining substantive relief at this stage.

Ratio Decidendi: A decree-holder may invoke winding up on a decretal debt without first exhausting execution, and limitation runs from enforceability of the decree rather than from the original cause of action where the petition is founded on the decree itself.

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