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- 2. Stamp paper and notary charges to be borne by client
- **All tax payments and penalties, if any to be borne by the client
Winding Up of a Company
A private limited company is an artificial judicial person and requires various compliances like appointment of Auditor, regular filing of income tax return, annual return filing and more. Failing to maintain compliance for a Company could result in fines and/or disqualification of the Directors from incorporating another Company. Therefore, if a private limited company has become inactive and there are no transactions in the company, then it is best to wind up the Company.
Voluntary winding up of a company can be initiated at anytime by the shareholders of the company. In case there are any secured or unsecured creditors or employees on-roll, the outstanding dues must be settled. Once all the dues are settled, the bank accounts of the company must be closed. Finally, the company must regularise any overdue compliance like income tax return or annual filing and surrender the GST registration. Once, all activities are stopped and the registrations are surrendered, the winding up application petition can be filed with the Ministry of Corporate Affairs.
Bizcruise can help you wind up your Company, quickly and easily. Bizcruise can help you initiate the winding up process within 10 to 14 business days. The entire process for winding up of a company can be completed within 3 to 6 months, subject to government processing times. The timeline for winding up of a company could also differ from case to case, based on unique circumstances. To discuss more about winding up a company, get in touch with an Bizcruise Advisor.
Winding up of a Company by Tribunal
Ending up of an organization might be needed because of various reasons including conclusion of business, misfortune, chapter 11, dying of advertisers, and so forth, The method for ending up of an organization can be started deliberately by the investors or loan bosses or by a Tribunal.
As per Companies Act 2013, an organization can be injury up by a Tribunal, if:
- The organization can’t pay its obligations.
- The organization has by uncommon goal settled that the organization be injury up by the Tribunal.
- The organization has acted against the interest of the power and uprightness of India, the security of the State, agreeable relations with unfamiliar states, public request, goodness or ethical quality.
- The Tribunal has requested the ending up of the organization under Chapter XIX.
- On the off chance that the organization has not documented fiscal reports or yearly returns for the first five continuous monetary years.
- On the off chance that the Tribunal is of the assessment that it is simply and fair that be organization should be injury up.
- On the off chance that the issues of the organization have been led in a fake way or the organization was shaped for deceitful and unlawful purposes or the people worried in the arrangement or the board of its undertakings have been liable of misrepresentation, misfeasance or wrongdoing in association therewith and it is legitimate that the organization be injury up.
Voluntary Winding up of a Company
The ending up of an organization should likewise be possible deliberately by the individuals from the Company, if:
- In the event that the organization passes a unique goal for ending up of the Company.
- The organization all in all gathering passes a goal requiring the organization to be injury up intentionally because of the expiry of the time of its term, assuming any, fixed by its articles of affiliation or on the event of any occasion in regard of which the articles of affiliation give that the organization should be disintegrated.
Steps for Voluntary Winding up of a Company
The following are the steps for initiating a voluntary winding up of a Company:
Step 1: Convene a Board Meeting with two Director 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, time agenda for a General Meeting of the Company after five weeks of this Board Meeting.
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.
Step 5: Within 10 days of passing of resolution for winding up of company, file a notice with the Registrar for appointment of liquidator.
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.
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 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.
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.
Step 11: Within two weeks of final General Meeting of the Company, file a copy of the accounts and file and application to the Tribunal for passing an order for dissolution of the company.
Step 12: If the Tribunal is satisfied, the Tribunal shall pass an order dissolving the company within 60 days of receiving the application.
Step 13: The company liquidator would then file a copy of the order with the Registrar.
Step 14: The Registrar, on receiving the copy of the order passed by the Tribunal then publish a notice in the Official Gazette that the company is dissolved.
Reasons to Winding Up of a Company
A company is a legal entity and a juristic person established created under the Companies Act. Therefore, a company is required to maintain regular compliance throughout its lifecycle. Winding up process can be to close a company that is not active and avoid compliance responsibilities.