https://www.taxtmi.com/caselaws?id=197358 The true nature of a transaction is determined from the agreement as a whole and the surrounding circumstances. Where the financier purchased machinery from suppliers chosen by the company and then leased the equipment back under a separate arrangement, without any transfer of ownership or option to purchase on expiry, the arrangement was a genuine lease and not a loan. The Usurious Loans Act, 1918 and the Punjab Relief of Indebtedness Act, 1934 therefore did not apply. Because the company defaulted in paying admitted lease rentals, failed to clear the liability after notice, and did not pay or secure the debt to the creditor's satisfaction, inability to pay debts was established and winding up was maintainable. en-us Wed, 05 Jul 1995 00:00:00 +0530 Thu, 04 Jan 2018 10:05:12 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=197358 The true nature of a transaction is determined from the agreement as a whole and the surrounding circumstances. Where the financier purchased machinery from suppliers chosen by the company and then leased the equipment back under a separate arrangement, without any transfer of ownership or option to purchase on expiry, the arrangement was a genuine lease and not a loan. The Usurious Loans Act, 1918 and the Punjab Relief of Indebtedness Act, 1934 therefore did not apply. Because the company defaulted in paying admitted lease rentals, failed to clear the liability after notice, and did not pay or secure the debt to the creditor's satisfaction, inability to pay debts was established and winding up was maintainable. Case-Laws Companies Law Wed, 05 Jul 1995 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=197358