Sanjib Banerjee, J.:— This petition has appeared after admission. The order of admission was appealed against and the appeal was withdrawn. Advertisements have been issued, but no other person has come up either to support or to oppose the petition for winding up of the company.

2. The order of admission was passed on July 7, 2005. The court was prima facie satisfied that the company was unable to pay its debts and that the claim of the petitioner was indisputable. The petition was admitted for euro 786,306 with interest at the rate of 6.5 per cent, per annum from September 8, 2003. The company was afforded an opportunity to pay off the entire amount, inclusive of interest in 48 equal monthly instalments beginning from August 1, 2005. No money was tendered and advertisements were published.

3. In the company's affidavit at this second stage, it admitted having purchased a Magnetom Harmony Magnetic Resonance Imaging (MRI) System at an original price of DM 2,100,000. Such equipment, according to the company, was a sophisticated piece of machinery and was the first of its kind in the city. The company received the equipment in the beginning of September 1998 and it was tested on January 5, 1999, and churned out its first image on January 15, 1999. According to the company, there were initial problems and the equipment was ready for regular use only in June 1999. The initial schedule of payments was, thus, required to be reworked. A letter of July 24, 1999, has been relied upon by which the payment was requested to be rescheduled.

4. According to the company Siemens A.G, the petitioning creditor, had the requisite technology whether by itself or by its Indian subsidiary or branch to service the equipment. Upon the petitioner not having serviced the equipment whether by itself or by its Indian branch, the company was unable to utilise the same, and, thus, not generate funds to pay the cost of the equipment.

5. A letter of May 2000, by which the petitioner instructed its Indian branch to stop servicing the MRI and another medical equipment, was placed in support of the company's contention that the petitioner did not afford the company an opportunity to effectively use the equipment and pay therefor. The company has also relied on a letter by the petitioner's Indian branch from which it appears that on account of non-payment of the rescheduled instalments to the petitioner, the Indian branch had decided not to render any service to any Siemens equipment at the company's medical centre.

6. Two other documents, of May and June 2000, have been relied upon by the company to suggest that service of the equipment had been suspended and as such the company was unable to operate the MRI and pay therefor. In the first of the documents, a letter dated May 19, 2000, the company had pleaded as follows:

“We sincerely apologise for the delay in the remittance in consonance with the revised schedule. This was primarily caused due to extreme financial crunch faced by ourselves resulting from heavy capital expenditures on new equipments and pressure of re-payments from banks and unsecured sources. In addition, a lethargic market scenario has further aggravated our revenues resulting in a poor cash flow making it incumbent for us to delay our dues. However, we are willing to make amends by paying all penal interest due upon instalments unpaid. We are also making urgent arrangements for remitting the balance unpaid overdue instalments at the earliest and earnestly regret inconvenience caused to you.”

7. The second of the documents is a record of what transpired at a meeting between the company and the Indian branch of the petitioner. A proposal was made by the company to make substantial payments. The minutes record the following at the very end:

“Siemens Limited (Indian branch of the petitioner) has assured to get back to JMD (the company) latest by 8th of June about the acceptability of this proposal. In the event this is accepted by SAG (the petitioner), then Siemens Limited, with the consent of SAG would start the servicing of the equipments at JMD.”

8. In these additional documents disclosed at the post-advertisement stage, there is material to substantiate the company's stand that the equipment could not be successfully operated. Yet there is also admission of the company's inability to pay and the company's tacit acknowledgment of the fact that the petitioner or its Indian branch were not obliged to keep the equipment serviced. It also appears from the volume of papers relied upon in the petition, that the two issues could not have been and, in fact, were not linked.

9. The agreement between the parties did not oblige the petitioner to ensure servicing or maintenance thereof. The agreement entitled the petitioner to charge additional interest upon the company defaulting in making payment in accordance with the agreed schedule. At the company's request the payment dates were rescheduled. Despite the company's request for deferred payments having been acceded to the company missed the first two suggested dates of payment. A sum of DM 255, 625 that the company had undertaken to pay by mid-December 1999, remained unpaid till beginning of May 2000, following which the petitioner instructed its Indian branch to suspend the servicing of the equipment.

10. The documents relied upon by the company are to be looked into, to ascertain whether they are material enough to resist the order sought to send the company into liquidation.

11. The procedure followed by this court requires examination at two stages. At the receiving stage, upon a petitioning-creditor establishing that the debt is undisputed, the creditor is entitled to an order of admission ex debito justitiae. Though the court takes only a prima facie view to test whether the petition should be received, the opinion is less tentative and more firm than what a prima facie view ordinarily connotes.

12. Of course, the court exercises discretion in passing an order of winding up. The first of the three sections ordinarily pressed into service on a creditor's application for winding up, tells us so. The court may feel, even at the receiving stage, that the winding up mode has been resorted to as a scandalous means. However, the discretion is exercised more at the final stage. Even if the court finds that the debt is indisputable and that the company is insolvent, the court may still refuse to wind up the company. High authorities tell us that such discretion has to be exercised judicially. There could be many reasons for the court to refuse an order of winding up despite the creditor unimpeachably establishing his debt. Other creditors may oppose and the court might accept the other creditors' view. Workers' interests may weigh with court. There could be commercial reasons for refusing an order of winding up; the company's revenues may be enough to meet its fixed costs but not enough to meet its variable costs. It is not possible to enumerate the grounds that can persuade the court to refuse to send the company into liquidation despite having found it to be unable to pay the petitioner's or other dues.

13. In the procedure that has been followed by this court, the two considerations at both stages are whether the debt is undisputable and the company should be wound up. The first has to be satisfied before the second test can be undertaken. At the admission stage, a less tentative and more firm view, albeit prima facie, is taken as to the indisputability of the debt. A far more tentative and less firm view is taken as to whether the company should be wound up. It is essentially an exercise to ascertain whether the petition is maintainable as the undisputed nature of the debt is the very foundation of a creditor's winding up petition being received.

14. At the post-admission stage, the company is not precluded to dispute the debt. The decision at the admission stage on the indisputable nature of the debt does not operate as res judicata. It is open to the company to demonstrate that there are other materials to question the indisputable character of the debt and thereby to suggest the necessity of a trial. It is, however, more for the company to dislodge the indisputable character of the debt than for the petitioner to re-establish the same.

15. The affidavit used by the company at the second stage is not combative on the indisputable character of the debt. The company has not made out other grounds to resist the order of winding up, even if it be taken that, the debt is indisputable.

16. Learned counsel for the company has submitted that the court should not exercise its discretion in favour of the petitioner inasmuch as the petitioner was a secured creditor and inasmuch as the agreement between the parties gave the petitioner an option to claim the equipment and realise its dues by the sale thereof. Such argument has been countered, and correctly in my view, by learned counsel for the company by citing section 439(1)(b) of the Companies Act, 1956 and sub-section (2) of the same section. The secured creditors have as much right as the unsecured creditors to seek winding up of a company. In seeking winding up, the secured creditor gives up his right to the security and stands in queue to receive his proportionate share out of the assets of the company, upon the company passing into the liquidation stage.

17. The petitioner has also averred at paragraph 64 of the petition that the value of the securities were not enough to meet the claim. Implicit in such statement is the petitioner's abandonment of its security.

18. Since no further grounds have been urged and the indisputable nature of the debt has not been questioned, it is not necessary to revisit the premise on which the petitioner founded its right to have the company wound up. At the receiving stage, this court had come to a conclusion, despite it being prima facie, that there was no dispute as to the debt.

19. There is a further reason to not reopen such matter as the company offered to pay off the dues in instalments but tendered a meagre Rs. 20 lakhs as upfront payment which the petitioner has justifiably refused to accept.

20. There will be an order in terms of prayer (a) of the petition. JMB Medicare Ltd. is directed to be wound up in accordance with the provisions of the Companies Act, 1956. The official liquidator shall forthwith take possession of all the assets and properties of the company and take control of all transactions involving the company.

21. Since the company has been directed to be wound up, the application for appointment of a provisional liquidator becomes meaningless and the same is disposed of without any order.

22. The company seeks a stay of operation of the order. There will be an unconditional order of stay till Friday next. If by next Friday a sum of Rs. 50 lakhs is deposited with the official liquidator, the order of stay will continue for a period of two weeks thereafter.

23. Urgent photostat certified copy be issued to the parties, if all formalities in that regard are complied with.