HC dismissed the appeal and upheld the winding-up order under...

HC dismissed the appeal and upheld the winding-up order under Section 433(e) of the Companies Act, 1956. The appellant-company failed to refund a Rs.50 lakh security deposit after contract termination despite its manufacturing business declining and supply difficulties. The court found no bona fide dispute existed, rejecting the company's contradictory and implausible defenses as lacking merit. Financial institutions had initiated recovery proceedings for crores, a receiver was appointed, and no production activities occurred for over five years. The company's offers to pay during proceedings without actual payment, combined with its financial misfortunes, were insufficient to resist winding-up. The court concluded the appellant-company was liable to repay the security deposit with interest, affirming the lower court's judgment.

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