The court emphasized the importance of a bona fide dispute and the existence of a debt, as well as neglect on the part of the company to pay such amount, in admitting a company petition for winding-up.

P.K. Misra, J.

The above appeal is filed against the order dated 212. 2001 passed in Company Petition No.186/1997, wherein the learned Single Judge has admitted the company petition filed under Section 439 read with Sections 433(e) and 434 of the Companies Act, 1956 for winding up of the present appellant company and directing the advertisement of such petition. The present respondent had filed such company petition.

2. The appellant company was initially incorporated as a Private Limited Company, which was subsequently converted to a Public Limited Company. The present respondent (the petitioner in the company petition) is an international firm of Aviation Consultants. The appellant company, with a view to start business relating to Aviation, had engaged the present respondent as Consultants since 1992. For the purpose of convenience, the respondent, who had filed the company petition for winding-up, is referred to as "the petitioner" and the present appellant is referred to as "the Company".

3. According to the case of the petitioner, the services of the petitioner were availed by the Company as consultants. The terms reflected in the correspondence between the two were accepted as apparent from the confirmation letter dated 3rd May, 1993. The rate of consultancy fees had been fixed as per the letter of the Company dated 12th April, 1993 and the reply of the petitioner dated 13th April, 1993. The services of the petitioner were also engaged by the Company to negotiate with AFT and United Airlines as per the terms reflected in the Letter of Engagement dated 17th January, 1997.

4. The amount payable to the petitioner on account of the on going consultancy services rendered by the petitioner and the amount payable relating to the other transaction had remained unpaid for a long period. Accordingly, the petitioner raised two Invoices, bearing Nos.ABA-100324 and ABA-100325, both dated 18.04.1997, for US$ 1,57,959 and 1,11,200 respectively, in all 2,69,159 US Dollars. Invoice No.ABA-100324 was raised by way of fees for on going consultancy services and invoice No.ABA-100325 was raised in connection with negotiations by the petitioner on behalf of the company with AFT and United Airlines.

5. Such amount having remained unpaid, statutory notice dated 25th April, 1997, as envisaged under Section 434 of the Companies Act, 1956 was issued calling upon the Company to pay 2,69,159 US Dollars. Inspite of such notice, no amount was paid by the Company. The petitioner issued a further reminder on 26th May, 1997 and subsequently, since the amount has remained unpaid, the petitioner has filed the company petition for winding-up of the company on the allegation that the Company has failed to repay its debts to the petitioner.

6. The Company in its counter has highlighted that the Company is erecting, installing and commissioning Wind Turbine Generators and similarly it was also running private Airlines and therefore appointment of the Official Liquidator as the Provisional Liquidator would spoil and cripple the entire business of the Company. It has been indicated in the counter that it is a running Company , owning assets and earning profits and therefore the Company petition is not maintainable. The Company denied the allegation regarding indebtedness by stating

"10. ... The Respondent states that no amount is due towards professional services as alleged. In asmuch as the Petitioner has not rendered any services muchless the professional services as falsely claimed and the Respondent has not agreed to pay any amount to the Petitioner, the Petitioner is not entitled to claim any amount from the petitioner (sick)"

It has been further stated that the Company had sent an interim reply to the Notice dated 25th April, 1997 denying all the allegations. However, the fact that the petitioner was engaged as an Air Travel Consultant through the letter of confirmation dated 3rd May, 1993 has been admitted. Nevertheless, it has been state