The liquidation of the Company’s assets, which are collected and sold in order to satisfy the obligations accrued, is referred to as winding up. When a corporation is wind up, the debts, expenditures, and charges are first paid off and dispersed among the shareholders. When a company is subject to liquidation, it dissolves officially and ceases to exist.
2. Introduction
• The liquidation of the Company’s assets, which
are collected and sold in order to satisfy the
obligations accrued, is referred to as winding
up. When a corporation is wind up, the debts,
expenditures, and charges are first paid off
and dispersed among the shareholders. When a
company is subject to liquidation, it dissolves
officially and ceases to exist.
• Winding up is the legal process of closing down
a firm and ceasing all operations. After the
winding up of Company, the Company’s existence
ends, and the assets are subject to supervision
3. Procedure of Modes of Winding up of a
company- Modes
• According to Section 270 of the Companies Act,
2013, a company can be wind up in two ways.
They are:
Compulsory Winding up of Company by Tribunal
Voluntary Winding up of Company
4. Compulsory Winding up of
Company
• According to Section 271 of
the Companies Act, a Tribunal
may issue an order to wind up
a company in the following
circumstances,
• Sick Company
• Special Proposal
• Acts against the State
• Fraudulent Conduct of Business
5. Procedure of Modes of Winding up of a
Company-Compulsory Winding up of Company
A petition is use to make an application to the
Tribunal in the winding up of a company under
Section 272 of the statute.
• The following individuals are entitled to file
this petition:
• The Company;
• Any creditor or creditors, including any
contingent or potential creditors;
• Any Contributors to that company;
6. The following is the procedure for compulsory
winding up of company by tribunal:
• Appointment of a Liquidator to the Company
under Section 275 to examine the Company’s
debts and credits in order to verify the
Company’s eligibility for forced winding up by
the Tribunal.
• Following the appointment, Liquidators as per
section 281 of the Act to make a report to the
Tribunal.
• The Tribunal issues orders to the liquidators
7. Voluntary Winding up of Company
Companies Act, 2013, specifies two
statutory conditions in which a company
may be voluntarily wind up. They are;
• If the company’s general meeting
approves a resolution requiring the
company to be wind up voluntarily as a
consequence of the expiration of the
time for its duration, if any, as per
its articles, or the occurrence of any
event for which the articles prescribe
that the company may be dissolve; or
8. Procedure of Modes of Winding up of a Company-
Voluntary Process
The following are the procedure for winding up
of company voluntarily:
• Convene a board meeting with the directors and
approve a resolution with a statement by the
directors that they have inquired into the
accounts of the business and that the company
has no obligations or that the company will pay
from the proceeds of the assets sold in the
voluntary winding up of the company.
• Notices calling for the general meeting of the
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