Compulsory Winding Up of the Company

SonaliBBA/13/913

Tuesday, May 2, 2023

Winding Up

• Winding up/liquidation represents the last stage in company’s life.

• It is a proceeding by which a company is dissolved.

• The company’s assets are disposed of , the debts are paid off out of the realised assets , and the surplus , if any is then distributed among the members in proportion to their holdings in the company

Modes of Winding Up

There are two modes of winding up of a company.

Winding up by the Tribunal Voluntary winding up which may be (a) members’ voluntary winding up OR (b) creditors’ voluntary winding up

Winding Up by Tribunal

The is also known as compulsory winding up and a company may be wound up in the following cases.

Special resolution of the company Default in delivering the statutory report to the

Registrar Failure to commence/suspension of business Reduction in membership Inability to pay its debts Just and equitable

Petition

An application to the Tribunal for the winding up of a company is made by a petition . This may be presented in following cases:

Petition by the company Petition by any creditor/creditors Petition by any contributory/contributories Petition by Registrar Petition by central Government

Commencement of Winding Up

Advertisement of petition Powers Tribunal Consequences of winding up order Procedure of winding up by the Tribunal Committee of inspection Dissolution of Company Contributory