Appointment of official liquidators: – Company Registration in Coimbatore

appointment

As far as it relates to the winding up of companies by the tribunal, the central government would have appointed as many official liquidators, deputy, joint or assistant official liquidators as it considers necessary in order to discharge the functions of the official liquidator.

The liquidators appointed under sub-section (1) shall be whole time officers of the central government.

The salary and other allowances of the official liquidator, joint official liquidator, deputy official liquidator and assistant official liquidator shall be paid by the central government.

Powers and functions of official liquidator:

appointment

The official liquidator shall exercise such powers and perform such duties as the central government may prescribe.

Without prejudice to the provisions of sub-section (1), the official liquidator may

  • Exercise all or any of the powers as may be exercised by a company liquidator under the provisions of this act; and
  • Conduct inquiries or investigations, if directed by the tribunal or the central government, in respect of matters arising out of winding up proceedings.

Summary procedure for liquidation:

  • Where the company to be wound up-
    • Have assets of book value not exceeding one crore rupees; and
    • Belongs to such class or classes of companies as may be prescribed,
  • The central government may order it to be the wound up by the summary procedure provided under this part.
  • Where an order under sub-section (1) is made, the central government shall appoint the official liquidator as the liquidator of the company.
  • The official liquidator shall forthwith take into this custody or control all assets, effects and actionable claims to which the company is or appears to be entitled.
  • Within thirty days from his appointment, the official liquidator has to submit a report to the central government in such a manner as prescribed which also includes a report whether in his opinion, any fraud being committed information, promotion or management of the affairs of the company or not.
  • On receipt of the report under sub-section (4), if the central government is satisfied that any fraud has been committed by the promoters, directors or any other officer of the company, it may direct further investigation into the affairs of the company and that a report shall be submitted within such time as may be specified.
  • After considering the investigation report under sub-section (5), the central government may order that winding up may be preceded.

Sale of assets and recovery of debts due to a company:

The official liquidator shall expeditiously dispose of all the assets whether movable or immovable within sixty days of his appointment.

Within thirty days from his appointment, the official liquidator may serve a notice which calls upon the debtors of the company or the contributories to deposit within a period of thirty days with the amount payable to the company.

Where any debtor does not deposit the amount under sub-section (2), the central government may, on an application made to it’s by the official liquidator, pass such orders as it thinks fit.

The amount recovered under this section by the official liquidator shall be deposited in accordance with the provisions of section 349.

Settlement of claims of creditors by official liquidator:

Within thirty days of the appointment, the official liquidator would have called upon the creditors of the company in order to prove their claims in such a manner as prescribed, within thirty days of the receipt of such call.

List of claims of creditors will be prepared by the official liquidator in such a manner as prescribed and each and every creditor would communicate about the claims accepted or rejected along with a reason to be recorded in writing.

Appeal by the creditor:

  • Any creditor aggrieved by the decision of the official liquidator under section 363 may file an appeal before the central government within thirty days of such decision.
  • The central government may after calling the report from the official liquidator either dismiss the appeal or modify the decision of the official liquidator.
  • Payments have to be made by the official liquidator to the creditors whose claims had been accepted.
  • At any stage, the central government at the time during the settlement of claims, if it considers as necessary, the matter will be referred to the tribunal for necessary orders.

Order of dissolution of a company:

The official liquidator shall if he is satisfied that the company is finally wound up, submit a final report to-

  • The central government in case no reference was made to the Tribunal under sub-section (4) of section 364; and
  • In any other case, the central government and the tribunal.

The central government, or as the case may be, the tribunal on receipt of such report shall order that the company be dissolved.

Where an order is made under sub-section (2), the registrar shall strike off the name of the company from the register of companies and publish a notification to this effect.

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