Voluntary winding up of Companies

UNDER COMPANIES ACT, 2013

STEPS-

Step 1: Convene a Board Meeting with two Directors or by a majority of Directors. Pass a resolution with a declaration by the Directors that they have made an enquiry into the affairs of the Company and that, having done so, they have formed the opinion that the company has no debts or that it will be able to pay its debts in full from the proceeds of the assets sold in voluntary winding up of the company. Also, fix a date, place, and time agenda for a General Meeting of the Company after five weeks of this Board Meeting.(sec-305)

(Resolution included a special resolution in respect of commencing the winding up of the company, and ordinary resolutions appointing a liquidator and indicating the liquidator’s remuneration. They also include further special resolutions in respect of the liquidator powers the division of surplus assets)

(These resolutions are in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit company purposes.)

(A resolution shall be an ordinary resolution if the notice required under this Act has been duly given and it is required to be passed by the votes cast.

A resolution shall be a special resolution when the intention to propose the resolution as a special resolution has been duly specified in the notice calling the general meeting or other intimation given to the members of the resolution.)

Step 2: Issue notices in writing calling for the General Meeting of the Company proposing the resolutions, with suitable explanatory statement.

Step 3: In the General Meeting, pass the ordinary resolution for winding up of the company by ordinary majority or special resolution by 3/4 majority. The winding up of the company shall commence from the date of passing of this resolution.

Step 4: On the same day or the next day of passing of resolution of winding up of the Company, conduct a meeting of the Creditors. If two thirds in value of creditors of the company are of the opinion that it is in the interest of all parties to wind up the company, then the company can be wound up voluntarily. If the company cannot meet all its liabilities on winding up, then the Company must be wound up by a Tribunal.(sec-306)1

Step 5: Within 10 days of passing of resolution for winding up of company, file a notice (form no-600) with the Registrar for appointment of liquidator.(sec-310)

(A liquidator is a member from the panel of professional firms of chartered accountant, advocates, companies secretaries, cost and work accountant which the central government may constitute. Body corporate approved by central government, whole- time or part- time officer appointed by the central government. )

Step 6: Within 14 days of passing of resolution for winding up of company, give a notice of the resolution in the Official Gazette and also advertise in a newspaper with circulation in the district where the registered office is present.(sec-307)

(Official gazette is a public journal and an authorized legal document of the government of India published weekly by publication department.)

Step 7: Within 30 days of General Meeting for winding up of company, file certified copies of the ordinary or special resolution passed in the General Meeting with the registrar for winding up of the company.

Step 8: Wind up affairs of the company and prepare the liquidators account of the winding up of the company and get the same audited.

Step 9: Call for final General Meeting of the Company for the purpose of laying the final winding up accounts.(sec-318)1

Step 10: Pass a special resolution for disposal of the books and papers of the company when the affairs of the company are completely wound up and it is about to be dissolved.(sec-318)2

Step 11: Within two weeks of final General Meeting of the Company, file a copy of the accounts and file an application to the Tribunal for passing an order for dissolution of the company.(sec-318) 4

Step 12: If the Tribunal is satisfied, the Tribunal shall pass an order dissolving the company within 60 days of receiving the application.(sec-318)5

Step 13: The company liquidator would then file a copy of the order passed by the tribunal with the Registrar within 30 days.(sec-318)6

Step 14: The Registrar, on receiving the copy of the order passed by the Tribunal then publishes a notice in the Official Gazette that the company is dissolved.(sec-318)7