Case List: Objection of the Creditors to Winding Up

While considering whether a winding up  petition should be allowed on the grounds of Section 433(e), i.e. inability to pay debts, the court will also give consideration to the wishes of the majority in value of the creditors, and if, for some good reason, they object to a winding up order, the court in its discretion may refuse the order. The wishes of the creditors will however be tested by the court on the following grounds-

  1. Whether the case of the persons opposing the winding up is reasonable;
  2. Whether there are matters which should be inquired into and investigated if a winding up order is made, and
  3. Whether it would benefit him or the company’s creditors generally (if not, a winding up order will not be made)

The grounds furnished by the creditors opposing the winding up will have an important bearing on the reasonableness of the case.


  • Madhusudan Gordhandas & Co. vs. Madhu Wollen Industries Pvt. Ltd.,  (1971) 3 SCC 632 (para 23)
  • Pradeshiya Industrial & Investment Corporation of U.P. V. North India Petro Chemical Ltd., (1994) 79 CompCas 835 (SC)  (para 31)

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