JUDGMENT - S.A. BOBDE, J.:---This appeal is preferred by a creditor of M/s. Enarai Finance Limited of which the respondent is the Managing Director. In the appellant's petition for winding up, consent terms dated 23-5-1998 were recorded and an order was made in terms thereof. Upon the company admitting its liability and agreeing to pay certain instalments, the respondent, who was the Managing Director of the company, agreed to an order guaranteeing the payment of the amounts due. He further agreed for the performance of the consent terms. Upon failure of the company to make payment in accordance with the order of the Company Court recording the consent terms, the appellant applied to this Court on 15-4-1999 for issue of an insolvency notice to the respondent. Upon the Insolvency Register raising an objection to the issue of insolvency notice, the appellant applied on 11-6-1999 to the learned Single Judge of this Court, who rejected the application and upheld the objections of the Insolvency Registrar by an order dated 11-6-1999. This appeal is preferred against that order. Since the original application is for permission to issue a notice of insolvency against the respondent, normally, the proceedings would have been ex parte. However, in this case, the respondent has chosen to appear before the learned Single Judge of this Court to oppose the application for issue of insolvency notice and has been heard there. Likewise, the respondent has also appeared before us. These proceedings are, therefore, not ex parte.

2. The appellant contends that under the consent order of this Court, there is an unequivocal admission of the company of its liability in the sum of Rs. 50.00 lakhs and that inter alia this Court has ordered the company to pay an amount of Rs. 28,72,315/-, the balance having been paid. Further, the respondent has, in the event of any default by the company, guaranteed payment of all amounts due by the company and also the performance of the consent order. The appellant's contention is, therefore, that she is entitled to have an insolvency notice under section 9 of the Presidency Towns Insolvency Act, 1909 (hereinafter referred to as the "Act") issued to the respondent. Section 9 of the Act reads as follows :---

"9. Acts of insolvency.---(1) A debtor commits an act of insolvency in each of the following cases, namely :---

(a) ..................

(b) ..................

(c) ..................

(d) ..................

(e) ...................

(f) ....................

(g) ..................

(h) ...................

STATE AMENDMENT

Maharashtra :

In its application to the State of Maharashtra, after Clause (h) of section 9, insert the following, namely :---

"(i) if, after a creditor has served an insolvency notice on him under this Act in respect of a decree or an order for the payment of any amount due to such creditor, the execution of which is not stayed, he does not, within the period specified in the notice which shall not be less than one month, either comply with the requirements of the notice or satisfy the Court that he has a counter claim or set off which equals or exceeds the decretal amount or the amount ordered to be paid by him and which he could not lawfully set up in the suit or proceeding in which the decree or order was made against him". (Emphasis supplied).

According to the appellant, the consent order of this Court amounts to a decree and is executable against the respondent by virtue of section 634 of the Companies Act, 1956 read with section 145 of the Code of Civil Procedure, 1908. Section 634 of the Companies Act reads as follows :---

"634. Any order made by a Court under this Act may be enforced in the same manner as a decree made by the Court in a suit pending therein."

Section 145 of the Code of Civil Procedure reads as follows :---

"145. Enforcement of liability of surety.---Where any person has furnished security or given a guarantee---

(a) for the performance of any decree or any part thereof, or

(b) ..........

(c) f

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