Judgment :- 1. This is a petition filed under Section 433 (e) and (f) read with Section 434 of the Companies Act, praying for the winding up of the respondent-Company and for the appointment of the Official Liquidator. 2. I have heard Mr. C.S. Vaidyanathan, learned Senior Counsel for the petitioner and Mr. P.S.Raman, learned Senior Counsel for the respondent. 3. This is a petition filed under Section 433 (e) and (f) read with Section 434 of the Companies Act, praying for the winding up of the respondent-Company and for the appointment of the Official Liquidator. 2. I have heard Mr. C.S. Vaidyanathan, learned Senior Counsel for the petitioner and Mr. P.S.Raman, learned Senior Counsel for the respondent. 3. The brief facts, as pleaded in the petition, leading to the institution of the above proceedings are as follows:- (i) that the respondent, which was originally incorporated as a Private Limited Company under a different name and which later became a closely held Public Limited Company and a wholly owned subsidiary of a listed Company, entered into 4 separate contracts, all on the same date viz., 10.5.2006 with the petitioner herein; (ii) that all the 4 contracts were towards the project of setting up a coal based power plant of 3,600 MW Capacity; (iii) that the total contract price of all the 4 contracts dated 10.5.2006 was fixed at USD 943,978,215.00 and INR 15,602,886,878.00; (iv) that as per the terms and conditions of the contracts, the petitioner not only started executing works, but also issued Performance Bank Guarantees to the total tune of USD 123,599,998.10, all of which are valid and subsisting till 31.10.2013; (v) that the petitioner completed all its obligations under all the 4 contracts and all the 4 Units (4 x 600 MW), were set up except that the Reliability Run and Performance Guarantee Test for Unit No.4 was pending; (vi) that all the 4 Units are complete in all respects and are already operating commercially and generating revenue, with the respondent selling power from all the 4 Units to various Government and Non-Governmental Agencies; (vii) that despite the petitioner fulfilling and performing all their obligations, the respondent delayed payment of even the admitted milestone payments, especially after 2010; (viii) that in several letters, the respondent duly admitted its default as well as the delay in the release of the outstanding payments; (ix) that when a staggering amount of USD 115.03 million and INR 140.95 crores was omitted to be paid by the respondent, the petitioner issued a notice of suspension of work on 18.4.2012; (x) that immediately the respondent sent a reply, giving a payment schedule, thereby admitting the liability; (xi) that even by a subsequent mail dated 20.4.2012, the respondent's Director admitted and acknowledged the liability to the tune of USD 107 million and INR 140 crores; (xii) that even while admitting and acknowledging liability under the letter dated 20.4.2012, the respondent simultaneously issued notices on the same date, viz., 20.4.2012 to the Bankers to invoke the Performance Bank Guarantees; (xiii) that therefore, the petitioner was constrained to move applications in Arbitration Petition Nos.590-593 of 2012 on the file of the High Court of Judicature at Bombay under Section 9 of the Arbitration and Conciliation Act, 1996, challenging the invocation of the Performance Bank Guarantees; (xiv) that the prayer of the petitioner in those applications for the grant of an ex parte order of interim injunction was rejected by a single Judge of the Bombay High Court on 23.4.2012; (xv) that the petitioner then moved appeals before the Division Bench and obtained interim prohibitory orders restraining the Banks from making payment to the respondent in pursuance of the invocation of Guarantee; (xvi) that immediately thereafter, the respondent issued a letter dated 24.4.2012, revoking the letter invoking Bank Guarantees; (xvii) that consequently, the parties reached a settlement, leading to the disposal of the appeals by the Division Bench, in terms of the consent between the parties; (xviii) that thereafter the petitioner as well as the respondent nominated the Arbitrators to resolve the disputes; (xix) that after the parties nominated the Arbitrators, but before the Arbitrators could choose an umpire, the parties resolved the dispute amicably in a meeting held on 10.7.2012; (xx) that in the Minutes of the meeting recorded on 10.7.2012, the respondent agreed to a schedule of payment, under which the respondent was to pay a sum of Rs.175 crores on or before 15.7.2012, a sum of Rs.50 crores on or before 15.8.2012, a sum of Rs.125 crores on or before 15.9.2012 and a sum of Rs.125 crores on or before 15.10.2012; (xxi) that after making payment of only a sum of Rs.100 crores, out of the total payment agreed to be made viz., Rs.475 crores, the respondent failed to make any further payment; (xxii) that the respondent thus defaulted in making payment of even the amount admitted and acknowledged under the Minutes of the meeting dated 10.7.2012; (xxiii) that when the petitioner issued a letter dated 6.8.2012, demanding payment, the respondent started making all kinds of objections; (xxiv) that in the meantime, it came to be known that the respondent initiated a process of merger and amalgamation with Sesa Goa Limited; (xxv) that upon coming to know of the petition of the respondent for approving a Scheme of Amalgamation pending in this Court in C.P.No.166 of 2012, the petitioner filed objections on 24.9.2012, on the ground that the petitioner is one of the largest unsecured creditor of the Company, whose interest will be jeopardised if the Scheme was sanctioned; (xxvi) that the financial position of the respondent is highly leveraged, as seen from its statements of financial affairs; (xxvii) that even as per the Annual Report for the financial year 2011-2012, the respondent-Company had utilised funds aggregating to Rs.6,421.95 crores raised on short term basis for long term investment; (xxviii) that the short term borrowings of the respondent have increased from Rs.4,814.35 crores as on 31.3.2011 to Rs.6,905.77 crores as on 31.3.2012; (xxix) that therefore the petitioner issued a statutory notice dated 1.11.2012 under Sections 433 and 434; (xxx) that the respondent gave a reply on 5.11.2012 raising frivolous objections; (xxxi) that since the respondent-Company appears to be in insolvent circumstances, it is just, equitable and necessary that the respondent-Company should be wound up. 4. 4. The respondent has filed a counter to the main Company Petition contending inter alia:- (i) that as against the total value of all the contracts dated 10.5.2006, working out to Rs.6,563/- crores, the respondent has already made payment of a sum of Rs.5,867/-crores to the petitioner; (ii) that the non-payment of the amount fixed in the Minutes of the meeting dated 10.7.2012 was on account of disputes on performance; (iii) that the contracts between the parties have an arbitration clause, in pursuance of which the petitioner already invoked arbitration and moved an application under Section 9 before the Bombay High Court; (iv) that those proceedings were withdrawn after the signing of the Minutes of the meeting dated 10.7.2012; (v) that therefore if the obligations under the Minutes of the meeting have not been complied with, the remedy of the petitioner lies only before the Court in which they moved an application under Section 9; (vi) that the amount of Rs.5,867/-crores paid by the respondent includes an amount of Rs.525/- crores paid in 2011-2012 and an amount of Rs.380/- crores paid in 2012-2013 and hence the petition for winding up is an abuse of the process of law; (vii) that there is no admitted or acknowledged debt or liability; (viii) that in the Minutes of the meeting dated 10.7.2012, a schedule of payment was fixed contingent upon the petitioner following a schedule of work set out in Clause 2(b) to Clause 2(g); (ix) that under Clause 2(f) of the MOM, the petitioner was to hand over Unit No.3 by 11.7.2012 after resuming normal operations on 9.7.2012; (x) that on the undertaking given by the petitioner to rectify the breach, the respondent agreed to give up the claim for liquidated damages; (xi) that in accordance with the MOM dated 10.7.2012, the respondent paid Rs.100/-crores to the petitioner, but the petitioner failed to fulfil their reciprocal obligations under the said MOM; (xii) that the petitioner failed to hand over Unit No.3 by 11.7.2012 and also failed to provide solution to generic defects affecting the plant performance; (xiii) that the petitioner failed to act upon 56 items agreed to between them; (xiv) that the petitioner failed to replace the Generator Transformer of Unit No.4 and also to resolve various other issues; (xv) that the question whether the respondent is liable to pay any amount to the petitioner, has become a disputed question; (xvi) that since the liability is disputed, a petition for winding up is not maintainable; (xvii) that to sustain their claim that Unit Nos.1, 2 and 3 were handed over on 5.4.2011, 7.11.2010 and 10.10.2011 respectively, the petitioner ought to have completed all punch points/pending items; (xviii) that in view of the Minutes of the meeting dated 10.7.2012, all prior correspondence between the parties, cannot be relied upon by the petitioner to fasten any liability upon the respondent; (xix) that the obligation to make payment under the MOM dated 10.7.2012, is not independent of the performance obligation of the petitioner; (xx) that Unit No.3 is yet to be completed to the satisfaction of the respondent, since Unit No.3 is now running with two boiler circulation pumps instead of 3 pumps; (xxi) that the third pump is defective and some other major equipment such as boiler, air pre-heater and HT Motor of boiler pumps are also defective and are yet to be rectified by the petitioner; (xxii) that the petitioner failed to replace the boiler circulation pump as stipulated in the MOM dated 10.7.2012; (xxiii) that the petitioner has not rectified or attended to the punch list of items; (xxiv) that Unit No.4 is in intermittent operation due to the respondent providing their own spare Generator Transformers, when one of the major equipment Generator Transformer of the Unit failed; (xxv) that the respondent has issued several letters pointing out the breach committed by them; (xxvi) that the petitioner not only failed to hand over Unit No.3, but also responsible for poor performance of Unit Nos.3 and 4; (xxvii) that the respondent is rated 'A' positive and 'AA' positive by CRISIL, signifying high degree of safety; (xxviii) that the petitioner first attempted to stall the process of amalgamation and has later come up with the winding up petition; (xxix) that the issues raised by the respondent are not frivolous, but are bona fide disputes; and (xxx) that therefore, no case for winding up is made out. 5. From the pleadings, it is clear that the dispute between the parties has to be seen in 3 stages, namely, (i) the disputes that arose before 10.7.2012, but which got settled, in the meeting held on 10.7.2012; (ii) the agreement reached on 10.7.2012 and (iii) the issues that have cropped up after 10.7.2012. 6. At the first stage, the petitioner admittedly issued a notice dated 18.4.2012, suspending the work in relation to all the 4 contracts. This led to the respondent invoking the Performance Bank Guarantee vide a letter dated 20.4.2012. The invocation of Bank Guarantee became the subject matter of a proceeding initiated by the petitioner under Section 9 of the Arbitration and Conciliation Act. Since the learned single Judge who heard that application refused to grant an ex parte interim order, the petitioner moved the Division Bench. Before the Division Bench, it was reported that the respondent withdrew the Letter of Invocation of Bank Guarantee and also undertook not to invoke the Performance Bank Guarantee till 11.6.2012. The petitioner agreed not to discontinue the work till 11.6.2012. Thereafter the parties nominated their respective Arbitrators to the Arbitral Tribunal on 19.5.2012 and 16.6.2012. But thereafter the parties had a meeting on 10.7.2012 and arrived at some understanding. Consequently, the Arbitral Tribunal was dissolved. Therefore, it is clear that what transpired upto 10.7.2012 is only a matter of academic importance and whatever had happened till then had to be taken only as a broad canvas, on which the latter events got painted. Hence, it is not necessary for me to deal with the spate of correspondence dated 25.5.2011, 12.8.2011, 2.1.2012, 17.1.2012 and 3.2.2012, to which the learned Senior Counsel for the petitioner drew my attention, to highlight the admission of liability on the part of the respondent. The admission of liability contained in this correspondence, eventually led to the petitioner suspending the operations by a notice dated 18.4.2012 and the respondent invoking the Bank Guarantee on 20.4.2012. The invocation of Bank Guarantee forced the petitioner to go to Court and the parties later invoked the Arbitration Clause, eventually to settle down for the bargains recorded in the Minutes of the meeting dated 10.7.2012. In such circumstances, what happened at the first stage, is not something on which, the questions raised in this petition can be decided? 7. The invocation of Bank Guarantee forced the petitioner to go to Court and the parties later invoked the Arbitration Clause, eventually to settle down for the bargains recorded in the Minutes of the meeting dated 10.7.2012. In such circumstances, what happened at the first stage, is not something on which, the questions raised in this petition can be decided? 7. Coming to the second stage, namely, the meeting that took place on 10.7.2012, the Agreement reached between the parties in the said meeting, are recorded in the form of a Minutes of the meeting. Paragraph 2 of the Minutes of the meeting, which contains the rights and obligations of both parties is extracted as follows:- “2. Keeping in view the overall interest of the project and notwithstanding the relevant provisions of the contract and/or any other agreement made earlier to the contrary, the following were mutually agreed between the parties. (a) SEL shall release the current due payments as per following schedule. (i) Rs.30 crore to be paid by 7th July, 2012 (ii) All dues upto Reliability Run of Unit, 1, 2 & 3 and upto synchronization of Unit 4 shall be paid by 15th July, 2012. Approximate amount to be paid under this schedule is Rs.175 crore (equivalent INR), the actual figures to be reconciled before making such payments. (iii) Rs.50 crore shall be paid by 15th August, 2012 as part payment against PG Tests for Unit, 1, 2 and 3. (iv) Remaining due payments out of the total contract price shall be made in two equal monthly instalments, one by 15th in September 2012 and the other by 15th in October 2012. (b) SEL expressed its serious concern for poor availability of the plant arising out of quality/underperformance of plant and equipment. It was pointed out to SEPCOIII that SEL has been suffering heavy losses due to non-availability of Unit 3 which is under mechanical breakdown since a long time for the tube leakages and other generic problems. It was decided that two nominated Engineers from each side shall identify and analyse the defects/deficiencies and recommend action plan for liquidation of such deficiencies. It was further decided that SEL shall make a shutdown schedule for unit 1, 2 & 3 in consultation with SEPCO III during which all these deficiencies shall be set right so as to evolve a long term solution. It was further decided that SEL shall make a shutdown schedule for unit 1, 2 & 3 in consultation with SEPCO III during which all these deficiencies shall be set right so as to evolve a long term solution. SEPCOIII stated that they would take a fair view in analyzing the defects and shall bear all costs except where it is clearly established that the defects are attributable to SEL or its O&M agency. SEPCOIII reiterated its commitment to provide a long term solution for the generic defects which have been seriously affecting the plant availability. A list of 10 major items affecting the plant performance was handed over to SEPCO III for study and action. This is in addition to a list of 56 items on which agreement was reached earlier and which will form part of this MOM along with the list of 10 major items referred above. (c) On BCW pumps, SEPCO III proposed its plan to send the pumps to China in batches of two for repair. SEL urged SEPCO III to take it up at appropriate level of Harbin and explore the possibility of making available two pumps from some other projects in India where Harbin is the supplier of the pumps and commissioning has not started. SEPCO III also requested SEL to expedite delivery of the two pumps ordered from KSB. It was pointed out by SEL that even after servicing of two pumps in KSB, Germany, the pumps are still not performing to its requirements. SEPCO III assured that in case rewinding/servicing in China does not give the desired result, SEPCOIII would replace all the defective pumps promptly. (d) Since many of the problems relate to the boiler and its accessories supplied by Harbin, senior management of SEPCOIII would take up with their counterparts in Harbin to liquidate the defects/deficiencies. (e) Despite considerable delay in achieving the provisional completion of the Units, SEL considered the request made by SEPCOIII and agreed to waive LD in respect of Unit 1, 2 and 3. (f) SEPCO III shall hand over Unit 3 to SEL by 11th July, 2012 after resuming normal operation of the Unit, scheduled on 9th July 2012. (g) SEPCO III requested that the warranty period of Unit 3 should commence from the completion date of Reliability Run i.e., 10th October 2011. (f) SEPCO III shall hand over Unit 3 to SEL by 11th July, 2012 after resuming normal operation of the Unit, scheduled on 9th July 2012. (g) SEPCO III requested that the warranty period of Unit 3 should commence from the completion date of Reliability Run i.e., 10th October 2011. After mutual deliberation, it was agreed that the warranty period shall start from the date of issuance of PAC for Unit 3, i.e., 25.5.2012. (h) It was agreed that there shall be no claim/counterclaims by either party in respect of the following. Compensation claim made by SEPCO III on all accounts. LD claim made by SEL (LD already deducted shall be refunded) Interest claims made by SEPCO III Compensation claims made by SEL on all accounts including of for generation loss. Provided however, for any damage arising out of any act or default by any party subsequent to this date of MOU, the other party shall have the right to make any claim in terms of provisions of the contracts. (i) On the matter of entry tax liability, SEL informed that SEL has received a demand of about Rs.127 crore from Government of Odisha (GoO), out of which it has already made a payment of Rs.15 crore. It was agreed that unless further demand is made by GoO before 15th October 2012 or final decision is made by the Hon'ble Supreme Court in the meanwhile, SEL shall defer the deduction of entry tax from SEPCOIII's dues till the instalment payment, referred to in 2a(iv). However, an amount of Rs.15 Cr. already paid to GoO shall be adjusted against the payments to be made and as referred in 2a(ii) above. It was further agreed that, if the stated amount of 15 crore is refunded to SEL at a later date under an order from a competent authority, SEL shall refund the same to SEPCOIII within 15 days of receiving of such refund by SEL. SEPCO III requested that in the event that there is no decision on the entry tax matter by the Supreme Court by 15th October 2012, SEL and SEPCO III would sit together to find out a suitable mechanism reasonably acceptable to SEL, so that the potential entry tax liability on SEL is secured.” 8. After the meeting held on 10.7.2012, the respondent had made payment of a sum of Rs.100/- crores. After the meeting held on 10.7.2012, the respondent had made payment of a sum of Rs.100/- crores. This includes a sum of Rs.30/- crores paid on 7.7.2012, as indicated in paragraph 2(a)(i) of the Minutes of the meeting. 9. The balance amount of Rs.275/- crores, as per the other clauses of paragraph 2(a) of the MOM is not paid, giving rise to a fresh dispute after 10.7.2012. 10. In the above background of facts, the main ground on which the petitioner has come up with the above petition under Section 433 (e) and 433 (f) of the Companies Act, 1956, is that even the liability as admitted in the Minutes of the meeting dated 10.7.2012 has not been paid; that the Scheme of Amalgamation with which the petitioner has come to this Court for approval in a different proceeding, shows the financial crisis into which the respondent has plunged and that therefore a Company, which is unable to pay even its admitted liability, has no justification to survive. 11. The main defence of the respondent to the above claim of the petitioner is that the obligation to make payment imposed under the Minutes of the meeting dated 10.7.2012 can be enforced only if the corresponding obligations on the part of the petitioner under the very same MOM are performed and that the refusal of the respondent to make payment, on account of bona fide disputes, cannot be seen as an inability to pay and that the petitioner cannot even compel the performance of the obligations on the part of the respondent under the MOM dated 10.7.2012, without fulfilling their reciprocal obligations. 12. In the light of the above pleadings and the documents, the questions that arise for consideration are (i) whether there is any unequivocal undeniable liability on the part of the respondent to make payment to the petitioner and (ii) whether the disputes raised by the respondent about their liability to pay, are bona fide disputes or disputes concocted and invented just for the purpose of depriving the petitioner of their legitimate dues. 13. Fortunately, the learned Senior Counsel, appearing on both sides, did not flood this Court with citations, for the propositions of law that are well settled for a fairly long time. 13. Fortunately, the learned Senior Counsel, appearing on both sides, did not flood this Court with citations, for the propositions of law that are well settled for a fairly long time. For the questions that have arisen for consideration, I also do not think that there is any necessity to refer to the catena of decisions, except a few. 14. As laid down by the Supreme Court in one of its earliest decisions in Madhusudan Gordhandas & Co. vs. Madhu Woollen Industries Pvt. Ltd {(Vol.42) 1972 Company Cases Page 125 (SC)}, this Court will not order winding up, if the debt is bona fide disputed and the defence is a substantial one. The test to be applied by the Court are:- (i) Whether the defence of the Company is in good faith and one of substance; (ii) Whether the defence is likely to succeed in point of law; and (iii) Whether the Company adduces prima facie proof of the facts on which the defence depends. It was made clear by the Supreme Court in that case that when the debt is undisputed, the Court will not reject the petition merely because the Company has the ability, but not the willingness to pay the debt. 15. Therefore, in the light of the fact that the respondent is denying its liability to pay unless and until the petitioner performs their obligations under the Minutes of the meeting, I have to see whether such a defence on the part of the respondent (i) is in good faith and (ii) is one of substance. If the defence set up by the respondent is only moonshine, fabricated for the purpose of depriving the lawful dues of the petitioner, then such a defence should be rejected as not in good faith and not one of substance. This question as to whether the dispute is bona fide and one of substance, has to be seen only in the light of the documents produced before me. 16. As I have pointed out earlier, what happened before 10.7.2012 may not have a serious bearing upon the question on hand. What happened on 10.7.2012 and thereafter, are of greater relevance. 17. I have already extracted paragraph 2 of the Minutes of the meeting dated 10.7.2012. The first part of paragraph 2, incorporated under Clause (a) relates to the payments due by the respondent. What happened on 10.7.2012 and thereafter, are of greater relevance. 17. I have already extracted paragraph 2 of the Minutes of the meeting dated 10.7.2012. The first part of paragraph 2, incorporated under Clause (a) relates to the payments due by the respondent. These payments are termed as “current due payments”, meaning thereby that they were already due for payment. But Clauses (b) to (f) of paragraph 2 contains the obligations on the part of the petitioner. According to the respondent, these obligations have not been performed by the petitioner. Therefore, the respondent contends that they would not make payment unless the obligations indicated in Clauses (b) to (f) are also performed. 18. In response to the claim of the respondent that they need not make payment in terms of the MOM dated 10.7.2012 unless and until the petitioner performs it obligations there under, the learned Senior Counsel for the petitioner raises three contentions. They are:- (i) that the Minutes of the meeting dated 10.7.2012 did not link the issue of payments with the other issues nor did the MOM make the payments depend upon the performance of the obligations by the petitioner; (ii) that the payments agreed to be made are actual “current due payments”, for the work already performed and they had no correlation to the small items of work indicated in the same MOM dated 10.7.2012; (iii) that, at any rate, the items of work to be completed, were already either completed or adjusted in terms of monetary compensation or agreed to be set right before March/April 2013. Let me now test these three contentions, since the dispute raised by the respondent may not be one of substance or bona fide, if these contentions of the petitioner are correct. 19. A careful perusal of the Minutes of the meeting dated 10.7.2012 would show hat the learned Senior Counsel for the petitioner is right in contending that the payments under Clause 2(a) of the MOM were not made contingent upon the performance of the obligations under the other Clauses by the petitioner. But the fact that the payments under the MOM were not dependent on the performance of the obligations of the petitioner, would not make the dispute raised by the respondent as devoid of substance. But the fact that the payments under the MOM were not dependent on the performance of the obligations of the petitioner, would not make the dispute raised by the respondent as devoid of substance. I do not think that there is any prohibition for the respondent to refuse to make even the admitted liability, if they have a serious and bona fide dispute with regard to the execution of the contract. Paragraph 1 of the Minutes of the meeting dated 10.7.2012 would show that the parties actually met on three different dates viz., 28.6.2012, 4.7.2012 and 10.7.2012 to resolve at least about five named issues, namely, (i) delay in commissioning (ii) delay in payments (iii) under performance of equipment (iv) compensation claims and (v) claims due to generation losses. 20. The obligations indicated in Clauses (b) to (f) of paragraph 2 of the MOM do not, technically speaking, have a correlation to the payment liable to be made under paragraph 2(a). But it does not mean that the respondent can never take advantage of the non-fulfilment of the obligations by the respondent. 21. If the petitioner had actually filed a civil suit for recovery of money in terms of paragraph 2(a) of the MOM dated 10.7.2012, it would have been open to the respondent to lodge a counter claim, due to the non-fulfilment of the obligations on the part of the petitioner, even without denying the liability. In such an event, the counter claim could not have been rejected either as devoid of substance or as a defence not raised bona fide. I doubt whether the petitioner could have succeeded in obtaining an interim degree on admission in terms of Order XXII, Rule 6, CPC, on the basis of paragraph 2(a) of the MOM, even in a civil suit for recovery of money. Therefore, the fact that the payments were not made conditional and the fact that the payments had no correlation to the obligations imposed under the MOM, cannot be a ground to conclude that the defence is not bona fide or that it is not one of substance. 22. Therefore, the fact that the payments were not made conditional and the fact that the payments had no correlation to the obligations imposed under the MOM, cannot be a ground to conclude that the defence is not bona fide or that it is not one of substance. 22. On the contention that certain items of work in respect of which a dispute is raised, have either been settled already or agreed to be adjusted in terms of monetary compensation or undertaken to be completed before March/April 2013, it is seen from paragraph 2(b) of the MOM that the parties had already reached an agreement in respect of a list of 56 items. Along with the said list, 10 major items were also included. But in so far as those 56 items are concerned, it appears that there was an earlier agreement reached on 4.7.2012 itself. Yet those 56 items were made part of the MOM along with 10 major items. 23. In so far as these items are concerned, it is contended by the learned Senior Counsel for the petitioner that the due date for completion was March/April 2013 and that, at any rate, the total value of these works would not be more than Rs.10 to 15 crores. Therefore, it is his contention that a huge payment of about Rs.275/-crores cannot be withheld by showing small items worth Rs.10 to 15 crores especially when Performance Bank Guarantee to the tune of more than Rs.600/- crores, is in force. 24. In Vijay Industries vs. NATL Technologies Limited { 2009 (3) SCC 527 }, the Supreme Court, after quoting extensively from Madhusudan Gordhandas & Co.,held that even if a part of the debt was found to be due, the petition for winding up was sustainable. The Court held that it is not a requirement of the law that the entire debt must be definite and certain. Therefore, it is contended by Mr. C.S. Vaidyanathan, learned Senior Counsel for the petitioner, that when the monetary value of the dispute is only towards part of the admitted liability, the refusal to pay the undisputed part of the debt, is sufficient to order winding up. 25. But, unfortunately for the petitioner, this Court as a Company Court, cannot go into Minute details and find out whether the monetary value of the dispute is grossly disproportionate to the admitted liability. 25. But, unfortunately for the petitioner, this Court as a Company Court, cannot go into Minute details and find out whether the monetary value of the dispute is grossly disproportionate to the admitted liability. In a Motor Car, valued at about Rs.20 lakhs, a small nut or bolt may be of insignificant value. But its absence or disorder may threaten the very utility of the vehicle. Therefore, if there are actually disputes with regard to the working condition of certain items of work, the fact that their monetary value is very insignificant when compared to the total liability, cannot be a reason to belittle the disputes raised. 26. It is true that the work schedule now agreed to between the parties, provides time to the petitioner to complete the works by March or April 2013. It is also true that the respondent has Performance Bank Guarantees furnished by the petitioner. Therefore, the refusal of the respondent to make payment of the amount agreed in the Minutes of the meeting, appears to be, on the face of it, unfair. But, unfortunately for the petitioner, I am not dealing with a civil suit. I am dealing with a company petition for winding up. The question whether the refusal of the respondent to pay money to the petitioner in a winding up petition is fair or unfair, cannot determine whether the Company is liable to be wound up or not. What is important is whether the refusal of the respondent to pay, is on the basis of a bona fide dispute, which has some substance or not. 27. To test whether a dispute is bona fide or not, there are two tests that could be applied by a Court. They are (i) whether the issues raised by way of disputes, have always existed between the parties or they were invented for the purpose of manufacturing a defence in response to a winding up notice and (ii) whether the issues raised by way of disputes are actually non-existent issues, deserve to be rejected outright. 28. If both the above tests are applied, the petitioner is bound to fail. As seen from the entire correspondence and the conduct of the parties, even prior to 10.7.2012, the respondent has been raising some issue or the other. 28. If both the above tests are applied, the petitioner is bound to fail. As seen from the entire correspondence and the conduct of the parties, even prior to 10.7.2012, the respondent has been raising some issue or the other. As a matter of fact, the disputes raised prior to 10.7.2012 culminated in two things, namely, the suspension of the work by the petitioner on 18.4.2012 and the invocation of Bank Guarantee by the respondent on 20.4.2012. Arbitration proceedings were also initiated. Thus, the parties have had disputes even before 10.7.2012. 29. The MOM dated 10.7.2012 was an attempt at reconciliation. Even in the said MOM, several issues are raised in paragraph 2(b) to (f). The statutory notice under Section 433 (e) was issued by the petitioner only on 1.11.2012. Therefore, it is clear that the respondent had raised disputes even 7, 8 months before the issue of the statutory notice and those issues were also kept alive. Hence the respondent would pass the first test, for deciding whether the dispute raised by them is a bona fide one or not. 30. The respondent would also pass the second test. The disputes raised are not alleged to be non-existent disputes even by the petitioner. The petitioner originally took a stand that the disputes with regard to 56 items had already been resolved. But it is seen from the Minutes dated 4.7.2012 that they were attempted to be resolved on that date, but eventually they were retained along with 10 other “major issues”, in the MOM dated 10.7.2012. Therefore, the petitioner now contends that the rectification of those defects have to be done before March/April 2013 and that in any case their monetary value will be very very less. Therefore, it is clear that the issues raised by the respondent cannot be rejected outright as non-existent or imaginary disputes. It is difficult for me to think that the respondent is raising a smoke screen as though there are disputes. Hence, the respondent would pass the second test also. 31. One important fact which cannot be over looked is that the total value of all the 4 contracts put together is Rs.6,563/- crores out of which the respondent had admittedly paid Rs.5,856/- crores. It means 90% of the total value of all the contracts had already been paid by the respondent. 31. One important fact which cannot be over looked is that the total value of all the 4 contracts put together is Rs.6,563/- crores out of which the respondent had admittedly paid Rs.5,856/- crores. It means 90% of the total value of all the contracts had already been paid by the respondent. In the light of such a staggering figure, it is impossible either to think that the respondent had become bankrupt or that they are unable to pay their debts. Though both sides invited my attention to the Scheme of Amalgamation as well as the debt equity ratios, I would not venture to go into the same, as I find that a bona fide dispute is raised by the respondent. It is now well settled that in a petition for winding up, it is no defence for a Company to say that they have the ability to pay but would not. Equally, the corollary viz., that the Company has no ability to pay is no reason, when they have a genuine dispute with the petitioner. Therefore, the debt equity ratio to which my attention is invited, is not something on which the petition could be decided. 32. Since I find that 90% of the total value of the contract had already been paid and also that the said amount is not a very small amount, I find no grounds to order the winding up of the Company and hence this Company Petition is dismissed. There will be no order as to costs. Consequently, connected applications are also dismissed.