Bona fide disputed debt rejected where acknowledgments and records showed liability, leading to admission of the company petition.

The alleged liability was not treated as a bona fide disputed debt because the respondent repeatedly acknowledged the outstanding balance, sought time for remittance, and did not dispute the invoices, bills of lading, certificate of origin, or debit note. Its later claim that the payments were investments or part of a business arrangement was found inconsistent with earlier emails and unsupported by contemporaneous records. The respondent's balance-sheet material also identified the petitioner as a creditor during the relevant period, while the later entry showing the petitioner as a debtor was viewed as an afterthought. The company petition was admitted.

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Issues: Whether the respondent's alleged liability was a bona fide disputed debt so as to defeat admission of the company petition, and whether the petition should be admitted.

Analysis: The correspondence between the parties repeatedly showed the respondent acknowledging the outstanding balance and seeking time for remittance. The invoices, bills of lading, certificate of origin, and debit note were not disputed. The respondent's later plea that the payments were merely investments or part of a business arrangement was found inconsistent with its earlier emails and unsupported by contemporaneous records. The respondent's own balance-sheet material also showed the petitioner as a creditor in the relevant period, and the later entry treating the petitioner as a debtor was regarded as an afterthought intended to avoid payment.

Conclusion: The debt was not shown to be genuinely disputed, and the company petition was admitted.

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