https://www.taxtmi.com/caselaws?id=103842 A winding-up petition based on debt cannot succeed unless the alleged liability is a definite, undisputed and crystallised company debt. Here, the memorandum of understanding was treated as a personal settlement, not a corporate obligation, because the managing director lacked actual authority in the absence of board or constitutional approval; the company was therefore not bound by it. Once the settlement was rescinded, the remaining claims were disputed rather than enforceable debt. The statutory test of inability to pay debts was not met, and the petition failed on merits. en-us Sat, 29 Mar 1997 00:00:00 +0530 Fri, 24 Feb 2012 17:42:59 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=103842 A winding-up petition based on debt cannot succeed unless the alleged liability is a definite, undisputed and crystallised company debt. Here, the memorandum of understanding was treated as a personal settlement, not a corporate obligation, because the managing director lacked actual authority in the absence of board or constitutional approval; the company was therefore not bound by it. Once the settlement was rescinded, the remaining claims were disputed rather than enforceable debt. The statutory test of inability to pay debts was not met, and the petition failed on merits. Case-Laws Companies Law Sat, 29 Mar 1997 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=103842