Admitted liability and insurer-payment defence did not prevent winding-up where the debtor defaulted under a consent order.

An admitted debtor cannot resist winding-up by pointing to payment made by the creditor's insurer under a separate insurance contract to which the debtor was not a party. The company had already acknowledged the debt in a consent order and agreed to pay it in instalments, so the insurer-payment defence did not extinguish the admitted liability. Any issues of subrogation, assignment, or recovery between insurer and insured were treated as separate and could not defeat the creditor's claim against the company. Where the company defaulted under the self-operative consent order and showed no legally sustainable defence, the winding-up order was maintained.

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Issues: (i) Whether the company could resist winding-up on the ground that the respondent had received payment from its insurer and therefore no debt survived against the company. (ii) Whether the winding-up order based on the admitted liability and default under the consent order was liable to be interfered with.

Issue (i): Whether the company could resist winding-up on the ground that the respondent had received payment from its insurer and therefore no debt survived against the company.

Analysis: The liability of the company had already been admitted in the consent order, under which it agreed to pay the quantified debt in instalments. The alleged payment by the respondent's insurer arose from a separate insurance arrangement to which the company was not a party. A debtor cannot rely on the insurer-insured contract to disown its own admitted liability. Any question of subrogation, assignment, or recovery between the insurer and the respondent was held to be a separate matter and could not defeat the respondent's claim against the company.

Conclusion: The defence based on insurer payment was rejected and the company remained liable to the respondent.

Issue (ii): Whether the winding-up order based on the admitted liability and default under the consent order was liable to be interfered with.

Analysis: The company had defaulted under the self-operative consent order, under which the petitions stood revived on default and were thereafter duly proceeded with. Since the debt remained admitted and the company failed to show any legally sustainable defence, there was no basis to disturb the winding-up order.

Conclusion: The winding-up order was upheld and the appeals failed.

Final Conclusion: The appeals were rejected, and the winding-up order against the appellant companies was sustained.

Ratio Decidendi: An admitted debtor cannot defeat a winding-up petition by invoking payment made by the creditor's insurer under a separate contract, because subrogation or assignment disputes between insurer and insured do not extinguish the debtor's liability.

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