Winding up petition for unpaid debt upheld; Section 69 bar and limitation objections failed, with no bona fide dispute proved.

A winding up petition was held maintainable despite objections based on limitation and Section 69 of the Indian Partnership Act, 1932. The petition was treated as filed within three years of the final invoice and last payment, so the limitation objection failed. Section 69 was held inapplicable because a winding up petition under the Companies Act, 1956 is a statutory insolvency remedy, not a suit to enforce a contractual right. On the merits, unpaid debt after statutory notice, together with the absence of a proved bona fide dispute or evidence of solvency, established inability to pay debts under Sections 433(e) and 434(1)(a). The company was ordered to be wound up and the official liquidator directed to take charge.

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Issues: (i) Whether the company petition was barred by limitation; (ii) whether the petition was barred under Section 69 of the Indian Partnership Act, 1932 on the ground that it was filed by an unregistered firm; and (iii) whether the respondent company was liable to be wound up for inability to pay its debts under Sections 433(e) and 434(1)(a) of the Companies Act, 1956.

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

Analysis: The final invoice was raised on 30.10.1998 and the last part payment was stated to have been made on 16.04.1999. The statutory notice was issued on 29.08.2000 and the company petition was filed on 18.06.2001. The invoice and last payment were not effectively rebutted by the respondent, and the petition was filed within three years of both events.

Conclusion: The petition was not barred by limitation and this objection failed.

Issue (ii): Whether the petition was barred under Section 69 of the Indian Partnership Act, 1932 on the ground that it was filed by an unregistered firm.

Analysis: Section 69 bars a suit for enforcement of a contractual right by an unregistered firm, but a winding up petition is founded on a statutory right under the Companies Act, 1956 and is not a suit for enforcement of a contractual claim. The proceeding seeks an order on commercial insolvency and inability to pay debts, not enforcement of a contractual obligation. The bar under Section 69 therefore does not extend to such a petition.

Conclusion: The petition was not barred by Section 69 of the Indian Partnership Act, 1932 and this objection failed.

Issue (iii): Whether the respondent company was liable to be wound up for inability to pay its debts under Sections 433(e) and 434(1)(a) of the Companies Act, 1956.

Analysis: The final invoice and the respondent's acceptance of the work value were treated as established, while the alleged defence of incomplete work and breach was not proved by evidence. The respondent did not rebut the statutory presumption arising from non-payment after notice under Section 434(1)(a). In the absence of proof of a bona fide dispute or solvency, the company was treated as unable to pay its debts.

Conclusion: The respondent company was liable to be wound up under Section 433(e) of the Companies Act, 1956.

Final Conclusion: The winding up petition succeeded, the respondent company was ordered to be wound up, and the official liquidator was directed to take charge in accordance with law.

Ratio Decidendi: A winding up petition under the Companies Act, 1956 is not a suit for enforcement of a contractual right, so the bar under Section 69 of the Indian Partnership Act, 1932 does not apply; where a creditor's debt remains unpaid after statutory notice and no bona fide dispute is proved, the company is deemed unable to pay its debts and may be wound up.

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