S. DASARADHA RAMA REDDI, J.

( 1 ) THE petitioner filed this petition seeking to wind up the respondent company on the ground that it has failed to pay Rs. 4,16,239 including interest and bank charges of Rs. 2,405 which represents the amount due by the respondent in respect of the brass tubes supplied to it by the petitioner. The respondent filed a counter contending that though the three invoices were raised on 29/03/1991, goods were actually despatched long afterwards, that the balance of Rs. 1,10,620 only remained payable which was being remitted on 4/11/1994, and that there is no stipulation for payment of interest. The petitioner filed rejoinder stating that the chief executive of the respondent company agreed to make the balance payment together with overdue interest from 24/05/1991, and that the petitioner has not received the cheque for Rs. 1,10,620 referred to in the counter. However, it is now admitted by both sides that the cheque for Rs. 1,10,620 dated 4/11/1994, has since been received by the petitioner through its counsel in December, 1994. The following issues were framed : (1) Whether the respondent is liable to pay interest on the value of the goods supplied by the petitioner ? (2) Whether the respondent-company is liable to be wound up for inability to pay the amount ? On behalf of the petitioner, its marketing manager was examined as PW-1 and exhibits A-1 to A-18 were marked, while the accounts officer was examined on behalf of the respondent company who got marked exhibits B-1 to B-9. Issue No. 1 : It is well-settled that a company can be wound up only when it is proved that the debt claimed against it is ascertained, definite and undisputed and that the company has failed to pay the same and winding up cannot be ordered if there is bona fide and substantial defence denying the liability. So, the question that has to be examined is whether the liability of the respondent company to pay interest on the overdue bills is bona fide, ascertained and undisputed ? PW-1 has deposed that as per the sale contract, exhibits A-3, dated 22/03/1991, issued by the petitioner to the respondent company, overdue interest at 2 per cent. per month was stipulated if documents are not retired within seven days from the date of presentation or within 25 days from the date of despatch, whichever is earlier. Exhibit A-11, dated 6/05/1992, is written on the letter head of the company addressed to one Rajesh stating that "mr. Naidu and Mr. Babla are with me regarding interest and balance of Rs. 75,000 is pending".

( 2 ) IN exhibit A-10, dated 13/04/1992, the respondent company has instructed its client, S. S. S. Kharkhana Limited, Yashwantnagar, to pay Rs. 2,84,839 on its behalf to the petitioner. Relying on these documents, Mr. Y. N. Lohita, learned counsel for the petitioner, contended that the parties have stipulated payment of interest on overdue bills.

( 3 ) ON the other hand, the contention of Mr. B. V. Subbaiah, learned counsel for the respondent, is that as per the purchase order, exhibit A-2, 5 per cent. advance has to be paid after acceptance of the order, another 5 per cent. two weeks thereafter and 80 per cent. against delivery, while 5 per cent. is payable against bank guarantee and 5 per cent. towards performance for two full seasons and that there is no stipulation for payment of interest. He submits that exhibit A-3 described as sales contract stipulating interest at 2 per cent. per month was neither signed nor received by the respondent and was brought into existence for the purpose of this petition and that it was not referred to in the first legal notice, exhibit A-12. He further submits that at the bottom of the second page of exhibit A-3, the date was mentioned as March 26, whereas at the top of the page the endorsement was shown as March 28. As per exhibit B-7, dated 20/05/1992, which is the letter written by the petitioner to the respondent company asking it to confirm the balance as on 31/03/1992, the amount was

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