Successful completion of a process is as important as its beginning. Voluntary liquidation process is not only a completion of liquidation but result in dissolution of the company.
Posted in Insolvency and Bankruptcy Code 2016, Voluntary Liquidation Process
Tagged Dissolution of Company, dissolution of corporate person, Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations 2017, voluntary liquidation, Voluntary Liquidation Process, Voluntary winding up
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.
Posted in Insolvency and Bankruptcy Code 2016, Voluntary Liquidation Process
Tagged Dissolution of Company, dissolution of corporate person, Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations 2017, voluntary liquidation, Voluntary Liquidation Process, Voluntary winding up
Satisfaction of claims is essential part of any liquidation. According to clause (6) of section 3 of the Insolvency and Bankruptcy Code, 2016, “claim” means—
(a) a right to payment, whether or not such right is reduced to judgment, fixed, disputed, undisputed, legal, equitable, secured or unsecured;
(b) right to remedy for breach of contract under any law for the time being in force, if such breach gives rise to a right to payment, whether or not such right is reduced to judgment, fixed, matured, unmatured, disputed, undisputed, secured or unsecured.
Posted in Insolvency and Bankruptcy Code 2016, Voluntary Liquidation Process
Tagged Claims, Dissolution of Company, dissolution of corporate person, Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations 2017, voluntary liquidation, Voluntary Liquidation Process, Voluntary winding up
In recent posts, we discussed voluntary liquidation and its commencement. In liquidation, liquidator play crucial role.
Posted in Insolvency and Bankruptcy Code 2016, Voluntary Liquidation Process
Tagged Dissolution of Company, dissolution of corporate person, Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations 2017, Insolvency Professional, voluntary liquidation, Voluntary Liquidation Process, Voluntary winding up
In last post we discussed here basic provisions of Section 59 of the Insolvency and Bankruptcy Code, 2016 about voluntary liquidation. As we mentioned, sub – section (3) to (5) of section 59 prescribes conditions related to corporate person registered as company. Similar conditions, in relation to voluntary liquidation of other corporate persons are prescribed in Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017. Here, we will discuss.
Posted in Insolvency and Bankruptcy Code 2016, Voluntary Liquidation Process
Tagged Dissolution of Company, dissolution of corporate person, Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations 2017, voluntary liquidation, Voluntary Liquidation Process, Voluntary winding up
Part II of Chapter XX of the Companies Act (discussed earlier here and here) has been omitted by the Insolvency and Bankruptcy Code, 2016. In new scheme, there will be voluntary liquidation, not voluntary winding – up as called earlier. In this post we will discuss Chapter V of the Insolvency and Bankruptcy Code, 2016 consisting of consisting of section 59.
Posted in Insolvency and Bankruptcy Code 2016, Voluntary Liquidation Process
Tagged Dissolution of Company, dissolution of corporate person, Insolvency, Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations 2017, Insolvency Professional, voluntary liquidation, Voluntary winding up
Here, we will discuss provisions related to Official Liquidator.
APPOINTMENT OF OFFICIAL LIQUIDATOR (SECTION 359)
For the purposes of this Act, so far as it relates to the winding up of companies by the Tribunal, the Central Government may appoint as many Official Liquidators, Joint, Deputy or Assistant Official Liquidators as it may consider necessary to discharge the functions of the Official Liquidator.
We will continue to discuss general provisions relating to winding up in this post also.
Certain limited powers of Company Liquidator (Section 343)
(1) The Company Liquidator may—
(a) with the sanction of the Tribunal, when the company is being wound up by the Tribunal; and
(b) with the sanction of a special resolution of the company and prior approval of the Tribunal, in the case of a voluntary winding up,—
(i) pay any class of creditors in full;
(ii) make any compromise or arrangement with creditors or persons claiming to be creditors, or having or alleging themselves to have any claim, present or future, certain or contingent, against the company, or whereby the company may be rendered liable; or
(iii) compromise any call or liability to call, debt, and liability capable of resulting in a debt, and any claim, present or future, certain or contingent, ascertained or sounding only in damages, subsisting or alleged to subsist between the company and a contributory or alleged contributory or other debtor or person apprehending liability to the company, and all questions in any way relating to or affecting the assets or liabilities or the winding up of the company and take any security for the discharge of any such call, debt, liability or claim, and give a complete discharge in respect thereof.
We will continue to discuss general provisions relating to winding up in this post also.
OFFENCE BY OFFICERS OF COMPANIES IN LIQUIDATION (SECTION 336):
If any person, who is or has been an officer of a company which, at the time of the commission of the alleged offence, is being wound up, whether by the Tribunal or voluntarily, or which is subsequently ordered to be wound up by the Tribunal or which subsequently passes a resolution for voluntary winding up,—
Now, we will discuss general provisions related to winding up applicable to every mode of winding up.
DEBTS OF ALL DESCRIPTIONS TO BE ADMITTED TO PROOF (SECTION 324):
In every winding up (subject, in the case of insolvent companies, to the application in accordance with the provisions of this Act or of the law of insolvency), all debts payable on a contingency, and all claims against the company, present or future, certain or contingent, ascertained or sounding only in damages, shall be admissible to proof against the company, a just estimate being made, so far as possible, of the value of such debts or claims as may be subject to any contingency, or may sound only in damages, or for some other reason may not bear a certain value.
In continuation of our discussion about voluntary winding up, we will discuss on company liquidator in voluntary winding up.
APPOINTMENT OF COMPANY LIQUIDATOR (SECTION 310):
The company in its general meeting, where a resolution of voluntary winding up is passed, shall appoint a Company Liquidator from the panel prepared by the Central Government for the purpose of winding up its affairs and distributing the assets of the company and recommend the fee to be paid to the Company Liquidator.
Posted in Chapter XX - CA2013, Companies Act 2013
Tagged Appointment of Company Liquidator, Companies Act 2013, Companies Bill 2012, CorpGov, CorpLaw, Corporate Governance, Corporate Law, Dissolution of Company, Duties of Company Liquidator, Final Meeting, India, Legal Reforms, Ministry of corporate affairs, Power of Company Liquidator, Reforms, Removable of Company Liquidator, Voluntary winding up, Winding Up
As we discussed as per section 270 of the Companies Act, 2013, the winding up of a company may be either –
CIRCUMSTANCES IN WHICH COMPANY MAY BE WOUND UP VOLUNTARILY (SECTION 304):
A company may be wound up voluntarily,—
Posted in Chapter XX - CA2013, Companies Act 2013
Tagged commencement of voluntary winding up, Companies Act 2013, Companies Bill 2012, CorpGov, CorpLaw, Corporate Governance, Corporate Law, declaration of solvency, effect of voluntary winding up, India, Legal Reforms, Meeting of Creditors, Ministry of corporate affairs, Reforms, Voluntary winding up, Winding Up
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