Court denies company's stay application in winding-up petition, emphasizes lack of evidence and director support.

The court rejected the company's contentions in an application for a stay of a Company Petition seeking winding up. The court found the company's defense improbable, lacking written evidence for an alleged oral agreement for set-off. Emphasizing the lack of support from the company's directors and failure to reply to statutory notice, the court held the winding-up application bona fide. The court ordered a permanent stay if the outstanding amount was paid by a specified date; failure would dismiss the stay application with costs, leading to further proceedings. The interim stay was to continue until the payment deadline.

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Issues:
Application for stay of Company Petition No. 201 of 1971.

Analysis:
The judgment pertains to an application for a stay of a Company Petition seeking the winding up of the company. The petitioning-creditor had sold goods to the company, and a substantial amount remained unpaid, leading to the filing of the winding-up petition. The company claimed there was an oral agreement for set-off with another firm, which the respondent denied. The court analyzed the contentions of both parties, emphasizing the lack of written evidence for the alleged oral agreement. The court found the company's defense to be improbable and raised solely to dispute the claim of the petitioning-creditor. The court noted the absence of support from the company's directors and the failure to reply to the statutory notice served by the respondent. Consequently, the court held that the winding-up application was bona fide, and the company's dispute was not genuine.

The court rejected the company's contentions and ordered that if the company paid the outstanding amount to the respondent by a specified date, the winding-up proceedings would be permanently stayed. Failure to make the payment would result in the dismissal of the stay application with costs. In such a scenario, the winding-up petition would be advertised, and the matter listed for further proceedings. The interim stay was to continue until the specified payment deadline.

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