1948 (8) TMI 13

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....n application under the provisions of the Indian Companies Act by a creditor bank for winding-up order on the debtor bank. The material facts are not seriously in dispute. On the 29th of November, 1947, a demand draft for Rs. 4,200 was issued by the SrimangaJ branch of the opposite party bank on its Sylhet Bazar branch in favour of Mrs. Madhuri Sinha Roy. This draft was duly endorsed by Mrs. Madhu....

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....rty bank should be deemed to be unable to pay its debt, and, therefore, a winding-up order should be passed. In support of the application the learned Advocate contended that the opposite party bank had no justification at all for refusing to honour the demand draft drawn on its Sylhet branch and that inasmuch as the provision of section 163, clause (1), of the Indian Companies Act had been compli....

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....ed by the petitioner bank that the opposite party does honestly believe that the demand draft was obtained by fraud and that the petitioner bank was a party to the fraud and that the opposite party bank does believe rightly or wrongly that it was justified in refusing to make the payment. In my opinion, when a debtor company believes even wrongly that it is justified in law to refuse to pay such a....