_WINDING UP OF A COMPANY UNDER COMPANY LAW PPT

WINDING UP OF A COMPANY UNDER COMPANY LAW

1. WINDING UP OF A COMPANY Overview and Procedures under Companies Act, 2013 & Insolvency and Bankruptcy Code, 2016

2. Definition and Meaning Winding up or liquidation is the legal process of closing down a company. It involves ceasing all business operations, realizing assets, paying debts, and distributing remaining funds to shareholders. It leads to the final dissolution of the company, ending its legal existence.

3. Legal Framework In India, the winding up of a company is governed by: • Companies Act, 2013 • Insolvency and Bankruptcy Code, 2016 (IBC) There are two primary modes: 1. Compulsory Winding Up 2. Voluntary Winding Up

4. Compulsory Winding Up Initiated by a court order (NCLT). Petition can be filed by: the company, creditor, contributory, ROC, or Government. Grounds include inability to pay debts, fraudulent conduct, or just and equitable reasons.

5. Procedure for Compulsory Winding Up 1. Filing of Petition 2. Appointment of Liquidator 3. Liquidation of Assets 4. Payment of Debts in priority order 5. Final Report and Dissolution order by NCLT

6. Voluntary Winding Up Initiated by the company through shareholders/creditors. Used when company is solvent and can pay debts. Governed by the Insolvency and Bankruptcy Code, 2016.

7. Procedure for Voluntary Winding Up 1. Declaration of Solvency by Directors 2. Special Resolution by Shareholders 3. Creditors' Approval (two-thirds in value) 4. Notification to ROC and IBBI 5. Liquidation Process by Liquidator 6. Final Meeting and Dissolution Order by NCLT

8. Key Forms and Documents • Winding Up Petition (Form WIN 1 or WIN 2) • Statement of Affairs (Form WIN 4) • Declaration of Solvency (Notarized) • Board and Special Resolutions • Indemnity Bond (Form STK-3) • Affidavits (Form STK-4) • Audited Financial Statements • Bank Closure Certificate