Once voluntary liquidation process started; satisfaction of claim becomes primary exercise. For this purpose, this is duty of liquidator handling voluntary liquidation to realize all assets of corporate person and distribute the proceeds.
For realization of assets, bank account is required for receiving all money due to corporate person. According to sub – regulation (1) of regulation 34, the liquidator shall open a bank account in the name of the corporate person followed by the words ‘in voluntary liquidation’, in a scheduled bank.
According to sub – regulation (2) of regulation 34, the liquidator shall pay to the credit of the bank account all moneys, including cheques and demand drafts received by him as the liquidator of the corporate person. The realizations of each day shall be deposited into the bank account without any deduction not later than the next working day.
As per sub – regulation (3), the money in the credit of the bank account shall not be used except in accordance with section 53(1).
According to sub – regulation (4) of regulation 34, all payments out of the account by the liquidator above five thousand rupees shall be made by cheques drawn or online banking transactions against the bank account.
According to sub – regulation (2) of regulation 35, the liquidation costs shall be deducted before distribution is made.
According to sub – regulation (1) of regulation 35, the liquidator shall distribute the proceeds from realization within six months from the receipt of the amount to the stakeholders. According to sub – regulation (3) of regulation 35, the liquidator may, with the approval of the corporate person, distribute amongst the stakeholders, an asset that cannot be readily or advantageously sold due to its peculiar nature or other special circumstances.
Return of money
Due to any error, there may be some over distribution of money to a person. According to sub –regulation (1) of regulation 36, a stakeholder shall forthwith return any monies received by him in distribution, which he was not entitled to at the time of distribution, or subsequently became not entitled to.
Unclaimed proceeds of liquidation or undistributed assets
According to sub – regulation (1) of regulation 39, before the order of dissolution is passed under section 59(8), the liquidator shall apply to the Adjudicating Authority for an order to pay into the Companies Liquidation Account in the Public Account of India any unclaimed proceeds of liquidation or undistributed assets or any other balance payable to the stakeholders in his hands on the date of the order of dissolution.
According to sub –regulation (3) of regulation 39, the liquidator shall furnish to the Registrar and the Board, a statement setting forth the nature of the sums included, the names and last known addresses of the stakeholders entitled to participate therein, the amount to which each is entitled to and the nature of their claim.
The liquidator shall be entitled to a receipt from the Reserve Bank of India for any money paid to it and such receipt shall be an effectual discharge of the liquidator in respect thereof.
According to sub – regulation (2) of regulation 39, any liquidator who retains any such money shall pay interest on the amount retained at the rate of twelve per cent per annum. Such liquidator shall also pay such penalty as may be determined by the Board.
Claim from Companies Liquidation Account
According to sub – regulation (5) of regulation 39, a person claiming to be entitled to any money paid into the Companies Liquidation Account may apply to the Board for an order for payment of the money claimed; which may, if satisfied that such person is entitled to the whole or any part of the money claimed, make an order for the payment to that person of the sum due to him, after taking such security from him as it may think fit.
According to sub – regulation (6) of regulation 39, any money paid into the Companies Liquidation Account in pursuance of this Regulation, which remains unclaimed thereafter for a period of fifteen years shall be transferred to the general revenue account of the Central Government.