Closure Private Limited Company
For Closure up of Private Limited Company Online without having to go to a judicature, the Ministry of Corporate Affairs has launched the rules and regulations 2020, as per the stipulated conditions in the Companies Act, an alternative to the normally used liquidation process according to India’s bankruptcy code. Get the Benefits of Closure up of Private Limited Company legal actions with Kanakkupillai!
Advantages of Closure Up of Company
From Debts And Responsibility After Liquidation
Once the process of liquidation is over, the directors and the administrators of the company are free from all debts, responsibilities, lender accounts, and pressure.
The Low Lost Needed For The Liquidation Process
The price or responsibilities expected in the liquidation process is relatively small, as rates will be employed for the sale of assets of the company.
Withdrawing Legal Action From The Company
If the recommendation or consideration is passed advisedly by directors of the company, they will dismiss legal action brought by the tribunal or by the court and allow the company directors to concentrate on other business possibilities.
Withdrawing Legal Action From The Company
If the recommendation or consideration is passed advisedly by directors of the company, they will dismiss legal action brought by the tribunal or by the court and allow the company directors to concentrate on other business possibilities.
Protection For Investors Or Creditors
Complying a continued struggle, investors or creditors will benefit from the liquidation process as they will be useable for a failed payment, regarding the statement of credits given by all investors or creditors.
Types of Company windup
What are the different ways in which an individual can wind up a Company?
A company can be wound up in two different ways-
- Voluntary winding up of a Company
- Compulsory winding up of a company
1.Voluntary Winding up of a Company
The Winding-up of a corporation is often done voluntarily by the members of the corporate, if :
- The company passes a special resolution for winding up the Company.
- The Company in general meeting passes a resolution which requires a company to wind up voluntarily as a result of the expiry of the period of its duration, and as per the Articles of Association or on the occurrence of any event in respect of which the articles of association provide that the company should be dissolved.
Procedure for Voluntary winding up of a Company
- Convene a board meeting with the Directors in which a resolution should be passed with a declaration by the directors that they have made an inquiry in the affairs of the Company and the company no debts or the Company will pay from the precedes of the assets sold in the voluntary wind up of the company.
- Notices should be issued in writing to call for the general meeting of the Company proposing the resolutions, with a suitable explanatory statement.
- Pass the ordinary resolution for winding up of the Company in the general meeting by ordinary majority or special resolution by 3/4 majority. The Winding-up of the Company shall commence from the date of passing the resolution.
- A meeting of the creditors should be conducted on an equivalent day or subsequent day of passing the resolution regarding completion. If the 2/3rd value of the creditors is of the opinion that it is in the interest of all parties to wind up the Company, the Company can wound up voluntarily.
- Within 10 days of passing the resolution for company winding up, a notice for appointment of liquidator must be filed with the registrar.
- Within 30 days of the general meeting for the winding up the certified copies of the ordinary or special resolution passed in the general meeting for the winding up of the Company.
- The affairs of the company need to be wind up and prepare the liquidator's account of the Winding-up account and get it audited.
- Call for the final General meeting of the Company.
- A special resolution should be passed for the disposal of the books and therefore the papers of the corporate when the affairs of the corporate are completely aroused and it is about to be dissolved.
- Within two weeks of the general meeting of the Company, file a copy of the accounts and file and the application to the tribunal for passing an order for the dissolution of the company.
- The tribunal shall pass an order dissolving the company within 60 days of receiving the application.
- The company liquidator is required to file a replica of the order with the registrar.
- The registrar will then on receiving the copy of the order passed by the Tribunal then publish a notice in the official gazette that the Company is dissolved.
- Compulsory winding up of a Private Limited Company
- Tribunal is responsible for this kind of wind up of Companies.
- Here are the reasons for the same:
- Unpaid debts of a Company
- When a special resolution is passed for winding up
- An unlawful act by a company or the management of the Company
- If the company is involved in fraudulent acts or misconduct
- If the annual returns or financial statements are not filed for five consecutive years with the ROC
- The Tribunal is of the view that the company should windup.
Procedure for compulsory winding up of a Company
Is to File a petition to the tribunal alongside the statement of the affairs of the corporate that's to finish up.
- The tribunal will either accept or reject the petition if the person other than the company files a petition then the tribunal may ask the company to file an objection. it goes alongside the statement of affairs within 30 days.
- A liquidator needs to be appointed by the tribunal for the winding-up process. The liquidator carries out the function of assisting and monitoring the liquidation proceedings.
- The liquidator is supposed to prepare a draft report for approval. when the draft report gets approved he shall submit the final report to the tribunal for passing the Closure up of Private Limited Company Online
- It is necessary for the liquidator to forward a copy to the ROC within 30 days, If he fails to do so then he will get a penalty.
- If the ROC finds the draft satisfactory he then approves the winding up of the Company and the name of the Company is struck from the register of Companies.
- ROC sends a notice for publication in the official gazette of India
