Registered-post refusal counts as statutory service, and a decree debt remains a winding-up debt absent a stay of execution.

Refusal to accept a properly addressed statutory demand sent by registered post constitutes effective service under section 434(1)(a) of the Companies Act, 1956, because the presumption arising from registered post and refusal is sufficient unless rebutted. A decree debt also remains available as a winding-up foundation despite a pending appeal or a cross-claim, unless execution of the decree is stayed. On these principles, the notice was treated as duly served and the decree debt was not displaced, so the winding-up order was maintained.

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Issues: (i) Whether a statutory notice of demand sent by registered post and returned with the endorsement of refusal amounted to service under section 434(1)(a) of the Companies Act, 1956. (ii) Whether a decree debt ceases to be a winding-up debt merely because an appeal is pending or because the company has raised a cross-claim.

Issue (i): Whether a statutory notice of demand sent by registered post and returned with the endorsement of refusal amounted to service under section 434(1)(a) of the Companies Act, 1956.

Analysis: The notice was properly addressed to the registered office and the postal cover bore evidence of posting and refusal. A refusal to accept a registered letter is treated as effective delivery for the purpose of statutory service, and the creditor is entitled to rely on the ordinary presumption arising from registered post and refusal. The denial in the company's affidavit did not displace that presumption on the materials before the Court.

Conclusion: The statutory notice was duly served and the objection to service failed, against the assessee.

Issue (ii): Whether a decree debt ceases to be a winding-up debt merely because an appeal is pending or because the company has raised a cross-claim.

Analysis: A debt which has been reduced to decree after contest is not rendered disputed merely because the company has filed another suit or has preferred an appeal. Unless execution of the decree is stayed, the decree debt remains available as the foundation for a winding-up petition. The pending cross-claim and appeal did not undermine the respondent's decree debt.

Conclusion: The debt remained a valid foundation for winding up, against the assessee.

Final Conclusion: The appeal failed, and the winding-up order was maintained because service of the statutory notice was established and the decree debt was not shown to be unavailable for winding-up purposes.

Ratio Decidendi: A refusal to accept a properly addressed registered statutory demand constitutes sufficient service for section 434(1)(a) of the Companies Act, 1956, and a decree debt is not displaced as a winding-up debt merely by a pending appeal or collateral claim absent a stay of execution.

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