Bona fide dispute defeats compulsory winding up where non-payment is contested and the court's power remains discretionary.

A demand-based presumption of inability to pay debts was held not to be conclusive for compulsory winding up, because the statutory power to wind up was discretionary rather than mandatory. The company's non-payment arose from a bona fide dispute and a counter-claim alleging irregular conduct, so the refusal to pay was not treated as neglect in the statutory sense. The Court also noted that the disputed sums had been deposited in Court, which was inconsistent with real inability to pay. Compulsory winding up was therefore considered inappropriate, and the company was not treated as having neglected to pay its debts within the meaning of the statute.

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Issues: Whether the company could be treated as unable to pay its debts, and whether a compulsory winding up order followed as of right on proof of such inability.

Analysis: The demand-based presumption of inability to pay debts was not treated as conclusive for winding up. The statutory language conferring power to wind up on the Court was read as discretionary, not mandatory. The non-payment relied upon by the appellants was found to arise from a bona fide dispute and asserted counter-claim based on allegations of irregular conduct, so the company's refusal to pay was not treated as neglect in the statutory sense. The Court also noted that the disputed amounts had been deposited in Court, which was inconsistent with any real inability to pay. In these circumstances, compulsory winding up was considered inappropriate.

Conclusion: The company was not held to have neglected to pay its debts within the meaning of the statute, and the request for compulsory winding up failed.

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