Statutory demand non-payment can deem a company unable to pay debts and support winding up under insolvency principles.

Non-payment of a duly served statutory demand for admitted dues, without the company securing or compounding the debt within the statutory period, can attract the deeming provision of inability to pay debts. The stated facts also pointed to financial distress, including losses and erosion of capital, which supported the conclusion that the company was unable to meet its liabilities. On that basis, the company was treated as liable to be wound up, and the winding-up petition was allowed with appointment of the official liquidator to take charge of its assets and affairs in accordance with law.

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Issues: Whether the company was deemed unable to pay its debts and liable to be wound up on account of non-payment of the petitioner's admitted dues.

Analysis: The petition was founded on the company's failure to pay salary and other dues after service of demand notices. The demand was treated as duly served and the company did not pay, secure, or compound the sum within the statutory period. On the facts placed before the Court, this attracted the deeming provision of inability to pay debts. The material also indicated financial distress, including losses and erosion of capital, reinforcing the conclusion that the company was not in a position to meet its liabilities.

Conclusion: The company was held to be deemed unable to pay its debts and therefore liable to be wound up.

Final Conclusion: The winding-up petition was allowed and the official liquidator was appointed to take charge of the company's assets and affairs in accordance with law.

Ratio Decidendi: Non-payment of a duly served statutory demand, without security or composition to the creditor's satisfaction, renders the company deemed unable to pay its debts and makes it liable to winding up.

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