Winding-up petition maintainable on admitted debt, dishonoured cheques, and an unsupported defence of oral adjustment.

A winding-up petition was treated as maintainable where the company admitted receipt of financial accommodation and liability to repay the principal with agreed interest, and the cheques issued in discharge of that liability were dishonoured for insufficiency of funds. An alleged oral arrangement to adjust the debt against flats at Kona was rejected because it was unsupported by any document and lacked credible substantiation. On that basis, the defence was found not bona fide and without merit, and the petition was admitted for the admitted dues with a direction to pay the quantified amount within the stipulated time.

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Issues: Whether the winding-up petition was maintainable and liable to be admitted on the basis of the admitted loan liability, dishonoured cheques, and the absence of a bona fide defence.

Analysis: The company did not dispute receipt of the financial accommodation or its liability to repay the principal with agreed interest. The cheques issued towards discharge of the liability were dishonoured for insufficiency of funds. The alleged oral arrangement for adjustment against flats at Kona was unsupported by any document and was raised without credible substantiation. In these circumstances, the defence lacked bona fides and had no merit.

Conclusion: The winding-up petition was rightly admitted for the quantified dues and the company was directed to pay the admitted sum within the stipulated time.

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