MCA Introduces New Rules for Winding-up Companies
The Ministry of Corporate Affairs has so far made the important amendments to the general provisions in the Company law in order to increase the convenience in business compliance. This includes the revision in the rules for company incorporation, as required from time to time. Recently, MCA had introduced the new compact company incorporation e-form SPICe+ that will help the new startup aspirants to fulfill many necessary business compliances through a single form.
With a view to systemize the procedure for the dissolution of a company, the MCA has now notified the Companies (Winding-Up) Rules, 2020. Through the said rules, the MCA has notified 95 different forms applicable in case of the dissolution of a company, namely Form WIN-1 to WIN 95.
Here we shall discuss the key clauses of the new Companies (Winding-Up) Rules, 2020.
#1. Applying for winding up of a company
In order to dissolve or wind-up an existing company, a petition has to be filed for winding up of a company to the National Company Law Tribunal (NCLT).
The petition for winding up a company shall be filed in Form WIN-1 or WIN-2, as per the case.
3 copies of the petition have to be presented to the tribunal.
Along with the petition an affidavit has to be presented by the petitioner(s) for the verification of the petition. Such an affidavit shall be filed in Form WIN-3.
#2. Filing Statement of affairs
The statement of affairs has to be filed by the petitioner in Form WIN-4.
The information contained in this statement must not be older than 30 days before the date of filing the petition.
2 copies of the statement of affairs have to be presented.
Along with the statement of affairs, an affidavit of the concurrence of the statement of affairs has to be filed in Form WIN 5.
#3. Admission & advertisement of the petition
After filing the petition for winding up, it shall be posted before the Tribunal for its admission, upon which a date for the hearing of petition shall be fixed.
Upon hearing of the petition, the Tribunal will give appropriate directions for the advertisement of winding up to be published.
Here the petitioner shall bear all the costs involved in the advertisement of winding up the company.
#4. Serving copy of the Petition
A copy of the petition for winding up the company has to be served to every contributory of the company.
This copy of the petition has to be furnished within 24 hours of the notice for the same
A noting charging of INR 5/- per page shall be levied on the petitioner.
#5. Advertising the Petition for winding up
Upon receiving the date of hearing of the petition, the notice of the petition shall be advertised—
In an English Newspaper and a vernacular language (local) newspaper, which is broadly circulated in the State/UT where the registered office of the company is located.
- The advertisement has to be published within 14 days of receiving the date of hearing of the petition.
- The advertisement has to be published in Form WIN-6.
#6. Withdrawing the petition for winding up the company
In case an applicant wants to withdraw his petition for winding up the company, upon filing it, he has to file an application to the tribunal, for the same. The petition that has been already advertised as explained above, can be withdrawn only—
With the leave of the tribunal.
After the date of hearing, as mentioned in the advertisement of the petition.
An application for leave to withdraw a petition for winding up a company shall not be heard any time before the date of hearing, fixed in the advertisement.
So, these are some key highlights of the Companies (Winding-Up) Rules, 2020.
If you want any sort of guidance regarding the process of company incorporation or winding up a company, you can feel free to contact our business advisor at 8881-069-069.
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