Disappearing company substratum can justify winding up as just and equitable when business has become impossible to carry on.

A company may be wound up on the just and equitable ground where its substratum has disappeared and its business has become impossible to carry on. The Court noted that the company had stopped business, sold its machinery and other movables, lost its leasehold premises, and had no assets available for rehabilitation or creditor satisfaction. It held that the absence of assets did not by itself prevent a winding-up order when the company no longer served the purpose for which it was incorporated. On those facts, the petition was maintainable and was allowed, and the company was ordered to be wound up with the provisional liquidator to act as liquidator.

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Issues: Whether the company was liable to be wound up on the ground that its substratum had disappeared and its business had become impossible to carry on.

Analysis: The company had stopped business, sold its machinery and other movables, lost its leasehold premises, and had no assets available for rehabilitation or for satisfaction of creditors. The provisional liquidator's report also indicated that winding up would be an empty formality, but the Court held that the absence of assets did not by itself bar a winding-up order where the company had ceased to have any real substratum and could no longer serve the purpose for which it was incorporated. In such a situation, it was just and equitable to order winding up, even at the instance of a secured creditor.

Conclusion: The petition for winding up was maintainable and was allowed; the company was ordered to be wound up and the provisional liquidator was to function as liquidator.

Ratio Decidendi: Where a company's substratum has disappeared and its business has become impossible, the Court may, in the exercise of its discretionary jurisdiction, order winding up as just and equitable.

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