Closure Of A Company
As a company is a creation of law and an incorporated entity under the provisions of the companies Act 1956 or 2013 as the case may be the same can be closed down only through the mechanism provided under the law. Any Company can be closed down its business by adopting any of the following two ways
Two Methods of closing the company is as under
Section 560, of the Companies Act, 1956, deals with strike off provisions of a defunct company. Any defunct company desirous to strike off its name from the register of Registrar of company can apply in Form FTE for strike off its name from the register maintained by ROC as per Guidelines for ‘FAST TRACK EXIT MODE’ issued vide General Circular No. 36/2011 dated 7.6.2011. Similarly, ROC has also power to strike off any defunct company after satisfying himself of the need to strike off a defunct company and has reasonable cause. But before passing any order in this regard, an opportunity of being heard must be provided to the defunct company by following the due procedure u/s 560.;
Section 425, of Companies Act, 1956, deals with modes of winding up. The winding up of a company may be either – (a) By the Tribunal (also known as compulsory winding up) (b) Voluntary winding up (c) subject to the supervision of the Court Voluntary Winding up : You can get a general picture from the following steps of winding up which are summarized below (except Voluntary winding up) a) Issuing a written demand for debt payments to the target company. b) Present a winding up petition to the court and the company c) Court hearing for the petition d) Granting of winding up order by the court e) Meeting of creditors and other relevant parties f) Appointment of liquidator. g) Realization and distribution of company’s assets to the creditors h) Realize of duties for liquidator i) Dissolution of the company.
