MCA releases Companies (Winding Up) Rules, 2020. Companies (Winding Up) Rules, 2020 shall come into force on the 1st day of April, 2020These rules shall apply to winding up under of Companies Act 2013.

MINISTRY OF CORPORATE AFFAIRS
Notification

New Delhi, the 24th January, 2020

G.S.R. 46(E). In exercise of the powers conferred by sub-sections (1) and (2) of section 468 and sub-sections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules, namely:-

Part 1

GENERAL

1. Short title, commencement and application.-

(1) These rules may be called the Companies (Winding Up) Rules, 2020.

(2) They shall come into force on the 1st day of April, 2020.

(3) These rules shall apply to winding up under of Companies Act 2013 (18 of 2013).

2. Definitions.- In these rules, unless the context or subject matter otherwise requires, –

(a) “Act” means the Companies Act, 2013 (18 of 2013);

(b) “Form” means a Form annexed to these rules;

(c) “Registrar” means the Registrar of the National Company Law Tribunal or National Company Law Appellate Tribunal and includes such other officer of the Tribunal or Bench thereof to whom the powers and functions of the Registrar are assigned;

(d) “Registry” means the Registry of the Tribunal or any of its Benches or of the Appellate Tribunal, as the case may be, which keeps records of the applications and documents relating thereto;

(e) “Section” means section of the Act;

(f) words and expressions used and not defined in these rules but defined in the Act shall have the meanings respectively assigned to them in the

Part II

WINDING UP BY TRIBUNAL

3. Petition for winding up.- (1) For the purposes of sub-section (1) of section 272, a petition for winding up of a company shall be presented in Form WIN 1 or Form WIN 2, as the case may be, with such variations as the circumstances may require, and shall be presented in triplicate.

(2) Every petition shall he verified by an affidavit made by the petitioner or by the petitioners, where there are more than one petitioners, and in case the petition is presented by a body corporate, by the Director, Secretary or any other authorised person thereof, and such affidavit shall be in Form WIN 3.

4. Statement of affairs.- The statement of affairs, as required to be filed under sub-section (4) of section 272 or sub-section (1) of section 274, shall be in Form WIN 4 and shall contain information up to the date which shall not be more than thirty days prior to the date of filling the petition or filling the objection as applicable and the statement of affairs shall be made in duplicate, duly verified by an affidavit., and affidavit of concurrence of the statement of affairs shall be in Form WIN 5.

5. Admission of petition and directions as to advertisement.- Upon filing of the petition, it shall be posted before the Tribunal for admission of the petition and fixing a date for the hearing thereof and for appropriate directions as to the advertisements to be published and the persons, if any, upon whom copies of the petition are to be served, and where the petition has been filed by a person other than the company, the Tribunal may, if it thinks fit, direct notice to be given to the company and give an opportunity of being heard, before giving directions as to the advertisement of the petition, if any, and the petitioner shall bear all costs of the advertisement.

6. Copy of petition to be furnished.- Every contributory of the company shall be entitled to be furnished by the petitioner or by his authorised representative with a copy of the petition within twenty four hours of his requiring the same on payment of five rupees per page.

7. Advertisement of petition.- Subject to any directions of the Tribunal, notice of the petition shall be advertised not less than fourteen days before the date fixed for hearing in any daily newspaper in English and vernacular language widely circulated in the State or Union territory in which the registered office of the company is situated, and the advertisement shall be in Form WIN 6.

8. Application for leave to withdraw petition.- (1) A petition for winding up shall not be withdrawn after presentation without the leave of the Tribunal subject to compliance with any order of the Tribunal, including as to costs.

(2) An application for leave to withdraw a petition for winding up which has been advertised in accordance with the provisions of rule 7 shall not be heard at any time before the date fixed in the advertisement for the hearing of the petition.

9. Substitution for original petitioner.- (a) Where a petitioner –

(i) is not entitled to present a petition; or

(ii) fails to advertise his petition within the time prescribed by these rules or by order of Tribunal; or

(iii) consents to withdraw the petition, or to allow it to be dismissed, or fails to appear in support of his petition when it is called on in Tribunal on the day originally fixed for the hearing thereof, or any day to which the hearing has been adjourned; or

(iv) if appearing, does not apply for an order in terms of the prayer of his petition; or,

(b) where in the opinion of the Tribunal there is other sufficient cause for an order being made under this rule, the Tribunal may, upon such terms as it may think just, substitute as petitioner any other person who, in the opinion of the Tribunal, would have a right to present a petition, and who is desirous of prosecuting the petition.

10. Procedure on substitution.- Where the Tribunal makes an order substituting a contributory as petitioner in a winding up petition, it shall adjourn the hearing of the petition to a date to be fixed by the Bench and direct such amendments of the petition as may be necessary and such contributory shall, within seven days from the making of the order, amend the petition accordingly, and file two legible and clean copies thereof together with an affidavit in duplicate setting out the grounds, on which he supports the petition and the amended petition shall be treated as the petition for the winding up of the company and shall be deemed to have been presented on the date on which the original petition was presented.

11. Affidavit-in-objection. Any affidavit in objection to the petition under sub-section (1) of section 272 shall be filed within thirty days from the date of order, and a copy of the affidavit shall be served on the petitioner or his authorised representative forthwith and copies of the affidavit shall also be given to any contributory appearing in support of the petition who may require the same on payment of five rupees per page within three working days.

12. Affidavit in reply.– An affidavit in reply to the affidavit in objection to the petition shall be filed not less than seven days before the day fixed for the hearing of the petition, and a copy of the affidavit in reply shall be served on the day of the filing thereof on the person by whom the affidavit in objection was filed or his authorised representative.

LIQUIDATOR

13. Applicability – Unless specified otherwise, the rules hereinafter shall apply to all types of liquidators.

14. Appointment of provisional liquidator or Company Liquidator.-

(1) After the admission of a petition for the winding up of a company by the Tribunal, and upon proof by affidavit of sufficient ground for the appointment of a provisional liquidator, the Tribunal, if it thinks fit, and upon such terms and conditions as in the opinion of the Tribunal shall be just and necessary, may appoint a provisional liquidator of the company, pending final orders on the winding up petition, in pursuance of clause (c) of sub-section (1) of section 273, and where the company is not the applicant, notice of the application for appointment of provisional liquidator shall be given to the company in Form WIN 7 and the company shall be given a reasonable opportunity to make its representation unless the Tribunal, for reasons to be recorded in writing, dispenses with such notice.

(2) The order appointing the provisional liquidator shall set out the restrictions and limitations, if any, on his powers imposed by the Tribunal in accordance with the sub-section (3) of section 275 and the order shall be in Form WIN 8, with such variations as may be necessary.

(3) An order for the appointment of a provisional liquidator as passed in accordance with clause (c) of sub-section (1) of section 273 shall also state that it will be the duty of every person, who is in possession of any property, books or papers, cash or any other assets of the company, including the benefits derived therefrom, to surrender forthwith such property, books or papers, cash or other assets and the benefits so derived, as the case may be, to the provisional liquidator.

(4) Where an order for the appointment of provisional liquidator or Company Liquidator, as the case may be, has been made, the Registrar shall, as provided in sub section (1) of section 277 within a period not exceeding seven days from the date of passing of the order, send intimation to the Company Liquidator or provisional liquidator in Form WIN 9 by registered post or by speed post or by courier service or by electronic means and a copy of the order for the appointment of provisional liquidator or Company Liquidator, as the case may be, shall also be sent to the Registrar of Companies together with a copy of the petition and the affidavit, if any, filed in support thereof.

(5) The provisional liquidator or the Company Liquidator, as the case may be appointed by the Tribunal shall file a declaration in Form WIN 10 disclosing conflict of interest or lack of independence in respect of his appointment, if any, with the Tribunal within seven days from the date of appointment.

(6) The provisional liquidator or the Company Liquidator, as the case may be shall be appointed by the Tribunal from amongst the insolvency professionals registered under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) unless the official liquidator is appointed.

15. Rules applicable to provisional liquidator.- The rules relating to Company Liquidators shall apply to provisional liquidators, so far as applicable, subject to such directions as the Tribunal may give in each case.

16. Costs, etc., of provisional liquidator.- Subject to any order of the Tribunal, all the costs, charges and expenses incurred by the provisional liquidator shall be paid out of the assets of the company and if the company does not have sufficient assets or any assets to pay the costs, charges and expenses, the Tribunal may make appropriate orders in this regard.

WINDING UP ORDER

17. Order to be sent to liquidator and form of order.- (1) For the purposes of sub section (1) of section 277, the order for winding up shall be in Form WIN 11 with such variations as may be necessary and the order for winding-up shall be sent by the Registrar after it is signed and sealed within a period not exceeding seven days from the date of receipt of the order by the Registrar, to the Company Liquidator and the Registrar of Companies in Form WIN 12 and Form WIN 13, and the copy of the order sent to Company Liquidator shall be accompanied by a copy of the petition and the affidavit, if any, filed in support thereof if not already sent at the time of appointment of the provisional liquidator.

(2) The Company Liquidator shall cause a sealed copy of the order to be served upon the company in accordance with the provisions of section 20, at its registered office or if there is no registered office, at its principal or last known principal place of business, or upon such other person or persons or in such manner as the Tribunal may direct.

(3) A copy of the order made by the Tribunal shall also be filed by the liquidator within thirty days of the receipt with the Registrar of Companies in form INC-28 of the Companies (Incorporation) Rules, 2014.

18. Contents of winding up order.- An order for winding up a company shall inter-alia contain that it will be the duty of such of the persons as are liable to submit the books of account of the company completed and audited upto the date of the order, to attend on the Company Liquidator at required time and place and give him all the information, and it will be the duty of every person who is in possession of any property, books or papers, cash or any other assets of the company, including the benefits derived therefrom, to surrender forthwith such property, books or papers, cash or other assets and the benefits so derived , as the case may be, to the Company Liquidator.

19. Directions on making winding up order. At the time of making the winding up order, or at any time thereafter, the Tribunal shall give directions to the petitioner as to the advertisement of the order and the persons, if any, on whom the order shall be served and the persons, if any, to whom notice shall be given of the further proceedings, in the liquidation, and such further directions as may be necessary.

20. Advertisement of order. Save as otherwise ordered by the Tribunal, the order for the winding up of a company by the Tribunal shall, within fourteen days of the date of the order, be advertised by the petitioner in a newspaper in the English language and a newspaper in vernacular language widely circulating in the State or the Union territory where the registered office of the company is situated and shall be served by the petitioner upon such person, if any, and in such manner as the Tribunal may direct, and the advertisement shall be in Form WIN 14.

21. Declaration by Company Liquidator.- The declaration by the Company Liquidator regarding disclosing conflict of interest or lack of independence, if any, in respect of his appointment as Company Liquidator as referred to in sub-section (6) of section 275 shall be filed in Form WIN 10 with the Tribunal.

22. Company Liquidator to take charge of assets and books and papers of company.- (1) On a winding up order being made, the Company Liquidator shall, forthwith take into his custody or under his control all the properties and effects, actionable claims and the books and papers of the company, and it shall be the duty of all persons having custody of any of the properties, books and papers, cash or any other assets of the company, to deliver possession thereof to the Company Liquidator.

(2) Where the company, its promoters, its key managerial personnel or any other person required to cooperate with the liquidator does not so cooperate, the liquidator may make an application to the Tribunal for an appropriate order.

(3) The Tribunal, on receiving an application under sub-rule (2), shall by an order, direct such promoters, key managerial personnel or other person (including contractual counter party, supplier, service provider or auditor) –

(a) to provide the information requested by the liquidator; and

(b) to comply with the instructions of the liquidator and to cooperate with him in collection of information and taking custody of the assets, properties and books of accounts.

23. Form of proceedings after winding up order is made.- After a winding up order is made or a provisional liquidator is appointed, every subsequent proceeding in the winding up shall bear the original number of the winding up petition besides its own distinctive number, but against the name of the company in the cause-title, the words ‘in liquidation’ or `in provisional liquidation’ as the case may be, shall appear in brackets.

APPLICATION FOR STAY OF SUITS ETC. ON WINDING UP ORDER

24. Application for leave to commence or continue suit or proceeding.- An application under sub-section (1) of section 279 for leave of the Tribunal to commence or continue any suit or other legal proceeding by or against the company shall be made in Form WIN 15 upon notice to the Company Liquidator and the parties to the suit or proceeding sought to be commenced or continued.

REPORTS BY COMPANY LIQUIDATOR UNDER SECTION 281

25. Report by Company Liquidator.- (1) The report to be submitted by the Company Liquidator under sub-section (1) of section 281 shall be in Form WIN 16 with such variations as may be necessary and the Company Liquidator may make further report or reports, if he thinks fit, according to the provisions of sub-section (4) of the said section.

(2) It shall be the duty of the promoters, directors, officers, employees and every person who has made or concurred in making of the statement of affairs, if and when required, to attend on the Company Liquidator and answer all such questions as may be put to him, give all such further information as may be required from him, and provide such assistance as may be required by the Company Liquidator.

(3) The Tribunal shall, within seven days from the receipt of such report, fix a date for the consideration thereof by the Tribunal and notify the date on the notice board of the Tribunal and to the Company Liquidator.

26. Inspection of statement of affairs and report.- Every creditor or contributory, by himself, or by his agent, shall be entitled to inspect the statement of affairs submitted under sub-section (4) of section 272 or sub­section (1) of section 274 and the report of the Company Liquidator submitted under sub-rule (1) of rule 25, on payment of a fee of one thousand rupees and to obtain copies thereof or extracts therefrom on payment of a fee of five rupees per page.

27. Consideration of report by Tribunal.- The consideration of the report made by the Company Liquidator pursuant to section 281, shall be placed before the Tribunal, and the Company Liquidator shall personally or by authorised representative attend the consideration of the said report and give the Tribunal any further information or explanation with reference to the matters contained therein which the Tribunal may require and on consideration of the aforesaid report, the Tribunal may pass such orders and give such directions as it may think fit.

SETTLEMENT OF LIST OF CONTRIBUTORIES

28. Provisional list of contributories. (1) Unless the Tribunal dispenses with the settlement of a list of contributories, the Company Liquidator shall prepare and file in the Tribunal not later than twenty-one days after the date of the winding up order a provisional list of contributories of the company with their names and addresses, the number of shares or the extent of interest to be attributed to each contributory, the amount called up and the amount paid up in respect of such shares or interest, and distinguishing in such list the several classes of contributories.

(2) The list shall consist of every person who was a member of the company at the commencement of the winding up or his representative, and shall be divided into two parts, the first part consisting of those who are contributories in their own right, and the second part, of those who are contributories as being representatives of, or liable for the debts of others, as required under sub-section (1) of section 281, and the list shall be in Form WIN 17.

29. Notice to be given of date of settlement.- (1) Upon the filing of the provisional list of contributories mentioned in rule 28, the Company Liquidator shall obtain a date from the Tribunal for settlement of the list of contributories and shall give notice of the date appointed to every person included in such list, stating in such notice in what character and for what number of shares or extent of interest such person is included in the list, the amount called up and the amount paid up in respect of such shares or interest, and informing such person by such notice that if he intends to object to his being settled as a contributory in such character and for such number of shares or interest as mentioned in the list, he should file in Tribunal his affidavit in support of his contention and serve a copy of the same on the Company Liquidator not less than two days before the date fixed for the settlement, and appear before Tribunal on the date appointed for the settlement in person or by authorised representative and such notice shall be in Form WIN 18 , and shall be sent in the mode set out in section 20 so that it reaches the contributories not less than fourteen days before the date fixed for the settlement.

(2) The person who posted the notice shall swear by an affidavit in Form WIN 19 relating to the dispatch thereof, and file the same in the Tribunal not later than two days before the date fixed for the settlement of the list.

30. Settlement of list.- On the date appointed for the settlement of the list referred to in rule 29, the Tribunal shall hear any person who objects to being settled as a contributory or as a contributory in such character or for such number of shares or extent of interest as is mentioned in the said list, and after such hearing, shall finally settle the list in accordance with sub-section (1) of section 285 and the aforesaid list when settled shall be certified by the Tribunal under its seal and shall be in Form WIN 20.

31. Notice of settlement to contributories.- (1) Upon the receipt of the settled list of contributories, as certified by the Tribunal interms of rule 30 , the Company Liquidator shall within a period of 7 days issue notice to every person placed on the said list of contributories, stating in what character and for what number of shares or interest he has been placed on the said list, what amount has been called up and what amount paid up in respect of such shares or interest and in the notice he shall inform such person that any application for the removal of his name from the aforesaid list or for a variation of the said list, must be made to the Tribunal within fifteen days from the date of service on the contributory of such notice, and such notice shall be in Form WIN 21 and shall be sent to each person settled on the said list by pre-paid registered post or speed post at the address mentioned in the said list.

(2) An affidavit of service relating to the dispatch of the notice to the contributories under this rule shall be sworn by the person who dispatched the said notice and shall be filed in Tribunal within seven days of the said dispatch of notice and such affidavit shall be in Form WIN 22.

32. Supplemental list of contributories.- The Tribunal may add to the list of contributories by a supplemental list or lists and any such addition shall be made in the same manner in all respects as the settlement of the original list.

33. Variation of list.- Save as provided in rule 31, the list of contributories shall not be varied, and no person settled on the list as a contributory shall be removed from the list, or his liability in any way varied, .except by order of the Tribunal and in accordance with such order.

34. Application for rectification of list.- If after the settlement of the list of contributories, the Company Liquidator has reason to believe that a contributory who had been included in the provisional list has been improperly or by mistake excluded or omitted from the list of contributories as finally settled or that the character in which or the number of shares or extent of interest for which he has been included in the list as finally settled or any other particular contained therein, requires rectification in any respect, he may, upon notice to the contributory concerned, apply to the Tribunal for such rectification of the list as may be necessary, and the Tribunal may on such application, rectify or vary the list as it may think fit.

35. List of contributories consisting of past members.- It shall not be necessary to settle a list of contributories consisting of the past members of a company, unless so ordered by the Tribunal and where an order is made for settling a list of contributories consisting of the past members of a company, the provisions of these rules shall apply to the settlement of such list in the same manner as they apply to the settlement of the list of contributories consisting of the present members.

ADVISORY COMMITTEE

36. Meeting of creditors and contributories.- The meeting of the creditors and contributories in accordance with the provisions of sub­section (3) of section 287 to determine the persons who may be the members of the advisory committee, shall be convened, held and conducted in the manner hereinafter provided in these rules for the holding and conducting of meeting of creditors and contributories.

37. Company Liquidator to report result of meeting.- ( ) As soon as possible but not later than seven days after the holding of the meeting of the creditors and contributories, the Company Liquidator shall report the result thereof to the Tribunal and such report shall be in Form WIN 23.

(2) Where the creditors and contributories have agreed upon the constitution and composition of the advisory committee and the persons who are to be members thereof, an advisory committee shall, subject to the provisions of sub-section (2) of section 287, be constituted in accordance with such decision, and the Company Liquidator shall set out in his report the names of the members of the committee so constituted.

(3) After being directed by the Tribunal to constitute an advisory committee where the creditors and contributories have not agreed upon the composition of the advisory committee and the persons who are to be members thereof, the Company Liquidator shall, at the time of making his report as aforesaid, apply to the Tribunal for directions as to what shall be its composition, and who shall be the members thereof, and the Tribunal shall thereupon fix a date for the consideration of the report of the Company Liquidator and the notice of the date so fixed shall be advertised by the Company Liquidator in such manner as the Tribunal shall direct not less than seven days before the date so fixed, and the advertisement shall be in Form WIN 24.

(4) On the date fixed for hearing of the said application for directions, the Tribunal may, after hearing the Company Liquidator and any creditor or contributory who may appear, decide as to who would be the members of the said advisory committee or pass such orders or give such directions in the matter, as the Tribunal may think fit.

38. Filling -up of vacancy in advisory committee.- (1) On a vacancy occurring in the advisory committee, the Company Liquidator shall forthwith summon a meeting of creditors or of contributories, as the case may require, to recommend for filling the vacancy and the meeting may, by resolution, recommend for re-appointing the same, or propose for appointing another creditor or contributory, as the case may to fill the vacancy:

Provided that if the Company Liquidator, having regard to the position in the winding up, is of the opinion that it is unnecessary for the vacancy to be filled, he may apply to the Tribunal and the Tribunal may make an order that the vacancy shall not be filled, or shall not be filled except in such circumstances as may be specified in the order.

(2) The continuing members of the advisory committee, if not less than two, may act notwithstanding any vacancy in the said committee.

(3) Where the creditors or contributories, as the case may be, fail to fill the vacancy for whatever reason, the Company Liquidator shall forthwith report such failure to the Tribunal and Tribunal may, by order, fill such vacancy.

39. Company Liquidator and members of advisory committee dealing with company’s assets.- Neither the Company Liquidator nor any member of the advisory committee shall, while acting as such liquidator or member of such committee in any winding up, either directly or indirectly, by himself or through his employer, partner, clerk, agent, servant, or relative, become purchaser of any part of the company’s assets, except by leave of the Tribunal and any such purchase made contrary to the provisions of this rule may be set aside by the Tribunal on the application of the said liquidator or of a creditor or contributory, as the case may be, and the Tribunal may make such order as to costs as it may think fit.

40. Advisory committee not to make profit.- No member of the advisory committee shall, except under the order of the Tribunal, directly or indirectly, by himself or through his employer, partner, clerk, agent, servant or relative, be entitled to derive any profit from any transaction arising out of the winding up or to receive out of the assets any payment for services rendered by him in connection with the administration of the assets, or for any goods supplied by him to the Company Liquidator for or on account of the company and where any profit or payment has been made contrary to the provisions of this rule, such payment shall be disallowed or the profit shall be recovered, as the case may be, on the audit of the such liquidator’s accounts or otherwise.

41.Cost of obtaining order of Tribunal.- In any case in which an order of the Tribunal is obtained under rule 39 or rule 40, the costs of obtaining such order shall be borne by the person in whose interest such order is obtained and shall not be payable out of the companies’ assets.

42. Order sanctioning payment to advisory committee.- Where the order of the Tribunal to a payment to a member of the advisory committee for services rendered by him in connection with the administration of the company’s assets is obtained, the order of the Tribunal shall specify the nature of the services, and such order shall only be given where the service performed is of a special nature, and except by the express order of the Tribunal, no remuneration shall be paid to a member of the advisory committee for services rendered by him in the discharge of the duties attached to his office as a member of such committee.

43. Meetings of advisory committee.- (l )The advisory committee shall meet at such times as it may from time to time appoint and the Company Liquidator or one-third of the total number of members of the said committee may also call a meeting of that committee as and when they think necessary.

(2) The quorum for a meeting of the advisory committee shall be one-third of the total number of the members, or two, whichever is higher.

(3) The advisory committee may act by a majority of its members present at a meeting, but shall not act unless a quorum is present.

(4) A member of the advisory committee may resign by notice in writing signed by him and delivered to the Company Liquidator.

(5) If a member of the advisory committee is adjudged as an insolvent, or compounds or arranges with his creditors, or is absent from five consecutive meetings of the said committee without the leave of those members who, together with himself, represent the creditors or contributories, as the case may be, his office shall become vacant.

(6) A member of the advisory committee may be removed, subject to the directions of the Tribunal, at a meeting of creditors if he represents creditors, or at a meeting of contributories if he represents contributories, by an ordinary resolution of which seven days’ notice has been given, stating the object of the meeting.

MEETINGS OF CREDITORS AND CONTRIBUTORIES

44. Application of rules to meetings.- Subject to any directions given by the Tribunal, rules as hereinafter set out shall apply to meetings of creditors and contributories as may be convened in pursuance of sub­section (3) of section 287 and sub-section (3) of section 292.

45. Notice of meeting.- (1) The Company Liquidator shall summon meetings of creditors and contributories by giving not less than fourteen days’ notice by sending individually to every creditor of the company a notice of the meeting of creditors, and to every contributory of the company a notice of the meeting of contributories, by sending notice by registered post or speed post or by electronic means so as to reach such person in not less than fourteen days before the date fixed for the meeting:

Provided that where the number of creditors or contributories, as the case may be, exceeds five hundred, the Company Liquidator shall also give a fourteen days’ notice of the time and place appointed for the meeting by advertisement in one daily newspaper in the English language and one daily newspaper in the principal regional language circulating in the State or Union territory concerned.

(2) The notice to each creditor shall be sent to the address given in his proof as referred to in rule 101 or, if he has not so proved, to the address given in the statement of affairs, or, to the address given in the books of the company, or to such other address as may be known to the person summoning the meeting, and the notice to each contributory shall be sent to the address mentioned in the books of the company as the address of such contributory or to such other address as may be known to the person summoning the meeting.

(3) The notices shall be in Forms WIN 25 to 29 as may be applicable.

46. Place and time of meeting. – Every meeting shall be held at such place and time as the Company Liquidator considers convenient for the majority of the creditors or contributories or both and different times or places or both may, if thought fit, be appointed for the meeting of the creditors or contributories or both.

47. Notice of first or other meeting to officers of company.- (1) The Company Liquidator shall also give, to each of the officers of the company, who in his opinion ought to attend the first or any other meeting of creditors or contributories, fourteen days’ notice in Form WIN 30 of the time and place appointed for such meeting and the notice may either be delivered by hand or sent by registered post or speed post or by electronic means as may be convenient, and it shall be the duty of every officer who receives notice of such meeting to attend if so required by the Company Liquidator, and if any such officer fails to attend, the Liquidator may report such failure to the Tribunal and the Tribunal may issue such directions to such person as it thinks fit.

(2) The Company Liquidator, if he thinks fit, may instead of requiring any of the officers of the company to attend the meeting as aforesaid, require such officer to answer any interrogatories or to furnish in writing any information that he may require for purposes of such meeting, and if such officer fails to answer the interrogatories or furnish such information, the liquidator shall report such failure to the Tribunal and the Tribunal may issue such directions to such officer as it may think fit.

48. Proof of notice.- An affidavit by any person who sent the notice, that such notice has been duly sent, shall be sufficient evidence of the notice having been sent to the person to whom the same was addressed and the affidavit shall be filed in the Tribunal in Form WIN 31.

49. Costs of meeting.- The cost of convening and conducting the meeting of the creditors or contributories shall be met out of the assets of the company.

50. Chairman of meeting.- The Company Liquidator or some person nominated by him shall be the Chairman of the meeting and the nomination shall be in Form WIN 32.

51. Resolution at creditors’ meeting.- At a meeting of creditors, a resolution shall be deemed to be passed, when a majority in value of the creditors present personally or by proxy and voting on the resolution have voted in favour of the resolution and in a winding up by the Tribunal, the value of a creditor, shall, for the purposes of a first meeting of the creditors meeting held under section 287, be deemed to be the value as shown in the books of the company, or the amount mentioned in his proof as referred to rule 101, whichever is less and for the purposes of any other meeting, the value for which the creditor has proved his debt or claim.

52. Resolution of contributories’ meeting.- At a meeting of the contributories, a resolution shall be deemed to be passed when a majority in value of the contributories present personally or by proxy and voting on the resolution have voted in favour of the resolution and the value of the contributories shall be determined according to the number of votes to which each contributory is entitled as a member of the company under the provisions of the Act, or the articles of the company, as the case may be.

53. Copies of resolution to be filed.- The Company Liquidator shall file in the Tribunal a copy certified by him of every resolution passed at a meeting of the creditors or contributories and the Registry shall keep in each case a file of such resolution.

54. Non-receipt of notice by creditor or contributory.- Where a meeting of creditors or contributories is summoned by notice, the proceedings and resolution at the meeting shall, unless the Tribunal otherwise orders, be valid notwithstanding that some creditors or contributories may not have received the notice sent to them.

55. Adjournments.- The chairman of the meeting may, with the consent of the creditors or contributories present in the meeting, as the case may be , adjourn it from time to time, but the adjourned meeting shall be held at the same place as the original meeting unless in the resolution for adjournment another place is specified or unless the Tribunal otherwise orders.

56. Quorum.- A meeting may not act for any purpose except for adjournment thereof unless there are present or represented thereat in the case of a creditors’ meeting at least three creditors entitled to vote or in the case of a meeting of contributories at least three contributories or all the creditors entitled to vote or all the contributories if the number of creditors entitled to vote or the number of contributories, as the case may be does not exceed three.

57. Procedure in absence of quorum.- If, within half an hour from the time appointed for the meeting, a quorum of creditors or contributories, as the case may be, is not present or represented, the meeting shall be adjourned to the same day in the following week at the same time and place and if at such adjourned meeting, the quorum is not present, at least two creditors or contributories present in person shall form the quorum and may transact the business for which the meeting was convened:

Provided that if at the adjourned meeting also two creditors or contributories, as the case may be, are not present, the chairman of the meeting shall submit his report to the Tribunal for such directions as the Tribunal may deem fit.

58. When creditor can vote.- In the case of a meeting of creditors held under section 287 or of any adjournment thereof, a person shall not be entitled to vote as a creditor unless he has duly lodged with the Company Liquidator not later than the time mentioned for that purpose in the notice convening the meeting, a proof of the debt which he claims to be due to him from the company and in the case of other meeting of creditors, a person shall not be entitled to vote as a creditor unless he has lodged with the Company Liquidator a proof of the debt which he claims to be due to him from the company and such proof has been admitted wholly or in part before the date on which the meeting is held:

Provided that this rule and rules 59 to 62 shall not apply to a meeting of creditors held prior to the meeting of creditors under section 287:

Provided further that this rules shall not apply to any creditors or class of creditors who by virtue of these rules or any directions given there under are not required to prove their debts.

59. Case in which creditors may not vote.- A creditor shall not vote in respect of any unliquidated or contingent debt or any debt, value of which is not ascertained, nor shall a creditor vote in respect of any debt secured by a current bill of exchange or promissory note held by him unless he is willing to treat liability to him thereon of every person who is liable thereon antecedently to the company, and against whom no order of adjudication has been made, as a security in his hands, and to estimate the value thereof, and for the purposes of voting, but not for purposes of dividend, to deduct it from his proof mentioned above.

60. When secured creditor can vote.- For the purposes of voting at a meeting, in a winding up by the Tribunal, a secured creditor shall, unless he surrenders his security, state in his aforesaid proof, the particulars of his security, the date when it was given and the value at which it is assessed by a registered valuer, and shall be entitled to vote only in respect of the balance due to him, if any, after deducting the value of his security.

61. Effect of voting by a secured creditor.- If a secured creditor votes in respect of his whole debt he shall be deemed to have surrendered his security, unless the Tribunal, on an application by such creditor, is satisfied that the omission to value the security was due to inadvertence.

62. Procedure when secured creditor votes without surrendering security.- The liquidator may within fifteen days from the date of the meeting at which a secured creditor voted on the basis of his valuation of the security, require him to give up the security for the benefit of the creditors generally on payment of the value so estimated by him, and may, if necessary, apply to the Tribunal for an order to compel such creditor to give up the security:

Provided that the Tribunal may, for good cause shown, permit the said creditor to correct his valuation before being required to give up the security, upon such terms as to costs as the Tribunal may consider just.

63. Admission or rejection of proof for purposes of voting.- The chairman of the meeting shall have power to admit or reject a proof for the purposes of voting, but his decision shall be subject to appeal to the Tribunal, and if he is in doubt whether a proof shall be admitted or rejected, he shall mark it as objected to and allow the creditor to vote subject to the vote being declared invalid in the event of the objection being sustained.

64. Minutes of proceedings.- (1) The chairman of the meeting shall cause minutes of the proceedings at the meeting to be drawn up and fairly entered in the Minute Book within 30 days and the minutes shall be signed by him or by the chairman of the next meeting.

(2) A list of creditors and contributories present at every meeting shall be made and kept in Form WIN 33.

65. Report to Tribunal.- The Company Liquidator shall, within seven days of the conclusion of the meeting, report the result thereof to the Tribunal in Form No. WIN 34.

PROXIES IN RELATION TO MEETINGS OF CREDITORS AND
CONTRIBUTORIES

66. Voting by proxies.- A creditor or contributory may vote either in person or by proxy, and where a person is authorised in the manner provided by section 113 to represent a body corporate at any meeting of creditors or contributories, such person shall produce to the Company Liquidator or and chairman of the meeting, as the case may be, a copy of the resolution so authorising him and such copy must be certified to be a true copy by a director, manager, secretary or other officer of the company duly authorised in that behalf, who shall certify that he is so authorised.

67. Form of proxies.- A creditor or contributory may give a general proxy or a special proxy to any person, and a general proxy shall be in Form WIN 35 and a special proxy in Form WIN 36.

68. Proxies to Company Liquidator or chairman of meeting.- A creditor or contributory in a winding up by the Tribunal may appoint the Company Liquidator or if there is no such liquidator, the chairman of the meeting, to act as his general or special proxy.

69. Use of proxies by deputy.- Where a Company Liquidator who holds any proxies cannot attend the meeting for which they are given, he may in writing depute some person under his official control to use the proxies on his behalf and in such manner as he may direct.

70. Forms to be sent with notice.- Forms of proxies shall be sent to the creditors and contributories with the notice summoning the meeting and no name shall be inserted or printed in the form before it is sent.

71. Proxies to be lodged.- A proxy shall be lodged not later than 48 hours before the meeting at which it is to be used, with the Company Liquidator in a winding up by the Tribunal.

72. Holder of proxy not to vote on matter in which he is financially interested.- No person acting either under a general or special proxy, shall vote in favour of any resolution which would directly or indirectly place himself, his partner or employer in a position to receive any remuneration out of the assets of the company otherwise than as a creditor ratably with the other creditors of the company.

73. Minor not to be appointed proxy.- No person shall be appointed as a general or special proxy who is a minor.

74. Filling in proxy where creditor or contributory is blind or incapable .-The proxy of a creditor or a contributory who is blind or incapable of writing may be accepted if such creditor or contributory has attached his signature or mark thereto in the presence of a witness who shall add to his signature his description and address:

Provided that all insertions in the proxy shall be in the handwriting of the witness and such witness shall have certified at the foot of the proxy that all such insertions have been made by him at the request and in the presence of the creditor or contributory before he attached his signature or mark.

75. Proxy of person not acquainted with English.- The proxy of a creditor or contributory who does not know English may be accepted if it is executed in the manner provided in rule 74 and the witness certifies that it was explained to the creditor or contributory in the language known to him, and gives the creditor’s or contributory’s name in English below the signature.

76. Submission of periodical reports to the tribunal.- The Company Liquidator shall make quarterly reports, referred to in sub-section (1) of section 288, to the Tribunal in Form WIN 37 with respect to the progress of winding up of the company.

77. Employment of additional or special staff by Official Liquidator.-Where the Official Liquidator is of the opinion that the employment of any special or additional staff is necessary in any liquidation, he shall apply to the Tribunal for sanction, and the Tribunal may sanction such staff as it thinks fit on such salaries and allowances as the Tribunal may deem appropriate.

78. Declaration by professional.- The professional, referred to in section 291, appointed by the Company Liquidator with the sanction of the Tribunal shall file a declaration in Form WIN 38 disclosing any conflict of interest or lack of independence in respect of his appointment with the Tribunal forthwith.

REGISTERS AND BOOKS OF ACCOUNT TO BE MAINTAINED BY
COMPANY LIQUIDATOR

79. Record book to be maintained by Company Liquidator.- The Company Liquidator shall maintain a record book for each company in which shall be entered minutes of all the proceedings and resolutions passed at any meeting of the creditors or contributories or of the advisory committee, the substance of all orders passed by the Tribunal in the liquidation proceedings, and all such matters other than matters of account as may be necessary, to furnish a correct view of the administration of the company’s affairs.

80. Registers and books to be maintained by Company Liquidator.- (1) The Company Liquidator shall maintain the following books of accounts, so far as may be applicable, in respect of the company under winding up:

(a) Register of Liquidations in Form WIN 38 A;

(b) Central Cash Book in Form WIN 38 B;

(c) Company’s Cash Book in Form WIN 38 C;

(d) General Ledger in Form WIN 38 D;

(e) Cashier’s Cash Book in Form WIN 38 E;

(f) Bank Ledger in Form WIN 38 F;

(g) Register of Assets in Form WIN 38 G;

(h) Securities and Investment Register in Form WIN 38 H;

(i) Register of Book Debts and Outstanding’s in Form WIN 38 -I;

(j) Tenants Ledger in Form WIN 38 J;

(k) Suits Register in Form WIN 38 K;

(l) Decree Register in Form WIN 38 L;

(m) Sales Register in Form WIN 38 M;

(n) Register of Claims and Dividends in Form WIN 38 N;

(p) Dividends Paid Register in Form WIN 38 P;

(q) Suspense Register in Form WIN 38 Q;

(r) Documents Register in Form WIN 38 R;

(s) Books Register in Form WIN 38 S;

(t) Register of unclaimed dividends and undistributed assets, deposited into the companies liquidation account in the Bank, in Form WIN 38T,

and in maintaining the registers and books mentioned above, the Company Liquidator shall follow -the instructions contained in the respective forms provided for the said books and registers.

(2) The Company Liquidator shall, in addition to the registers and books referred to in sub-rule (1), maintain such other books as may be necessary for the proper and efficient working of his office such as petty cash register, correspondence register, despatch register, daily register of money orders and cheques received for accounting of transactions entered into by him in relation to the company.

(3) Where the accounts of the company are incomplete, the Company Liquidator shall, with all convenient speed, as soon as the order for winding up is made, have them completed and brought up-to-date.

(4) (a) Where the Company Liquidator is authorised to carry on the business of the company he shall keep separate books of account in respect of such business and such books shall, as far as possible, be in conformity with the books already kept by the company in the course of its business, and the Company Liquidator shall incorporate in the winding up cash book and in the company’s cash book, the total weekly amounts of the receipts and payments on such trading account.

(b) The trading account shall, from time to time not less than once in every month, be verified by affidavit, and the Company Liquidator shall thereupon submit such account to the advisory committee (if any) or such member thereof as may be appointed by the said committee for that purpose, who shall examine and certify the same.

(5) The Company Liquidator shall keep proper vouchers for all payments made or expenses incurred by him, and the vouchers shall be serially numbered.

BANKING ACCOUNT OF COMPANY LIQUIDATOR

81. All money to be paid into special bank account in a scheduled bank.- (1) The Company Liquidator shall deposit into a special bank account in his official name opened in any scheduled bank or any other bank as may be permitted by the Tribunal (hereinafter referred to as the bank) , all moneys including cheques and demand drafts received by him as the Company Liquidator of the company, and the realisations of each day shall be deposited in the bank without deduction, not later than the next working day of the bank and the Company Liquidator may maintain a petty cash of five thousand rupees or such higher amount as may be permitted by the Tribunal to meet day to day expenses, and all payments out of the aforesaid account by the Company Liquidator above two thousand rupees shall be made by cheque drawn against the said account.

(2) The Company Liquidator shall make quarterly reports to the Tribunal regarding the funds, including filing the bank statements of the special bank account.

82. Bills, cheques, etc. to be deposited with bank.- All bills, cheques, hundies, notes and other securities payable to the company or to the Company Liquidator thereof shall, as soon as they come into the hands of the Company Liquidator, be deposited by him with the bank for the purpose of being presented for acceptance and payment or for payment only, as the case may be and the proceeds when realised shall be credited by the bank to the special bank account.

83. Payments into Bank.- Where the Tribunal makes an order directing any person to pay any money due to the company into the special bank account maintained by the Company Liquidator, the person so directed shall, at the time of making the payment, produce to the bank a certified copy of the order or a payment in challan endorsed by the Company Liquidator under his signature and the person making the payment shall give notice thereof to the Company Liquidator and produce before him the bank receipt relating thereto.

84. Company Liquidator’s Dividend Account.- The Company Liquidator shall also open a separate dividend account for the company under liquidation with the sanction of the Tribunal, in any scheduled bank, under the name ‘the Dividend Account of…………….. (name of the company) in liquidation’ into which account he shall, upon a declaration of dividend being made in the winding up of the company, deposit by transfer from special bank account, the total amount of the dividend payable upon such declaration and there shall be a separate such account in respect of each declaration of dividend and all payments of dividend shall be made from the said Company Liquidator’s dividend account and any unpaid balance in the said account shall be transferred to the Company Liquidation Dividend and Undistributed Assets Account referred to in sub-section (1) of section 352, and all payments of dividends shall be made by cheques or through Electronic Clearing System drawn against the said account.

85. Where the company has no available assets.- (1) Where a company against which a winding up order has been made has no available assets, the Company Liquidator may, with the leave of the Tribunal, incur any necessary expenses in connection with the winding up, out of any permanent advance or other fund provided by the Central Government, and the expenses so incurred shall be recouped out of the assets of the company in priority to the debts of the company:

Provided that where any money has been advanced to the Company Liquidator by the petitioner or other creditor or contributory for meeting any preliminary expenses in connection with the winding up, the Company Liquidator may incur any necessary expenses out of such amount, and the money so advanced shall be paid out of the assets of the company in priority to the debts of the company:

Provided further that if the Official Liquidator maintains any Common Pool Fund or Establishment Fund under order of the court prior to the date of the commencement of these rules, he shall continue to use such fund for the purpose for which the fund was originally created.

(2) The Official Liquidator shall reimburse the amount availed out of the said Common Pool Fund or Establishment Fund for the purpose of meeting the expenditure of the company in liquidation which does not have sufficient funds to its credit from the amounts of the company in liquidation on priority basis as and when any amount comes to its credit.

INVESTMENT OF SURPLUS FUNDS

86. Investment of surplus funds.- (l) All such money for the time being standing to the credit of the Company Liquidator at the bank as is not immediately required for the purposes of winding up, shall be invested in Government securities or in interest bearing deposits in any scheduled bank in the name of the company in liquidation or provisional liquidation represented by Company Liquidator of the company to which the funds belong and such funds so invested shall be monitored regularly by the Company Liquidator and the returns also containing the details of fixed deposit receipts shall be submitted to the Tribunal.

(2) Where the fixed deposit has matured, it shall not be automatically renewed but the Company Liquidator shall carry out the due diligence to assess whether a higher rate of interest is available in any other scheduled bank and the said Liquidator shall report the conclusion of such due diligence to the Tribunal, and in the event a higher rate of interest is available in any other scheduled bank, the said Liquidator shall apply for the leave of the Tribunal to invest the surplus funds in such other scheduled bank offering higher rate of interest.

87. Company Liquidator to examine accounts for purposes of investment.- The Company Liquidator shall, at the end of every month, examine account of liquidation to ascertain what moneys are available for investment, and shall make an entry at the end of every month in the record book relating to the company of his having examined the account for the purpose and of the decision taken by him regarding the investment, and in case he decides not to invest any surplus funds, the reasons for such decision.

88. Investments to be made by Bank.- All investments shall be made by the bank upon the written request of the Company Liquidator but the securities shall be retained in the bank in the name and on behalf of the Company Liquidator, and shall not be sold except by the bank and under the written instructions of the Company Liquidator, and when the securities are sold, the proceeds shall be credited by the bank to the account of the Company Liquidator.

89. Dividend and interest to be credited.- All dividends and interest accruing from any securities or investments shall from time to time be received by the bank and placed to the credit of the account of the Company Liquidator and intimation thereof shall be given to the Company Liquidator, who shall thereupon credit such dividend or interest in his account to the company to which the security or the investment relating thereto belongs.

90. Refunds of taxes.- The Company Liquidator shall claim such refunds of income-tax or other taxes as may be due.

FILING AND AUDIT OF COMPANY LIQUIDATOR’S ACCOUNT

91. Half-yearly accounts to be filed.- For the purposes of sub-section (2) of section 294, unless otherwise ordered by the Tribunal, the Company Liquidator shall file his accounts to Tribunal twice a year and such accounts shall be made up to the 31st of March and 30th of September every year, the account for the period ending 31st March being filed not later than the 30th of June following, and account for the period ending 30th September, not later than the 31st of December following:

Provided that the final accounts of the Company Liquidator shall be filed as soon as the affairs of the company have been fully wound up, irrespective of the period specified above:

Provided further that the Tribunal may permit the Company Liquidator to straight away forward completed accounts of the company in liquidation in respect of relevant period to the auditor for the purpose of audit in Form WIN 42 requesting that the accounts may be audited, and the certificate of audit shall be submitted to the Tribunal not later than one month from the date of receipt of the copy of the accounts as required under sub­section (3) of section 294:

Provided also that the accounts need not be got audited where the transaction during the period is for ten thousand rupees or less.

92. Form of account.- The account shall be a statement of receipts and payments in Form WIN 39 and shall be prepared in accordance with the instructions contained in the said form and three copies thereof shall be filed, and the account shall be verified by an affidavit of the Company Liquidator in Form WIN 40 and the final account shall be in Form WIN 41.

93. Nil account.- Where the Company Liquidator has not, during the period of account, received or paid any sum of money on account of the assets of the company, he shall file an affidavit of no receipts or payments on the date on which he shall have to file his accounts for the period.

94. Registry to send copy of account to auditor.- As soon as the accounts are filed, the Registry shall forward to the auditor one copy thereof for purposes of audit with a requisition in Form WIN 42 requesting that the accounts may be audited and a certificate of audit be submitted to the Tribunal not later than one month from the date of receipt of the copy of the account as required under sub-section (3) of section 294:

Provided that the accounts need not be got audited where the total transaction during the period is for ten thousand rupees or less.

95. Audit of Company Liquidator’s accounts.- The accounts shall be preferably audited by one or more Chartered Accountants appointed by the Tribunal from out of the panel to be maintained by the Tribunal, the audit shall be a complete check of the accounts of the Company Liquidator and the Company Liquidator shall produce before the auditor all his books and vouchers for the purposes of the audit, and shall give the auditor all such explanations, information and assistance as may be required of him in respect of the accounts.

96. Audit certificate to be filed.- After the audit of the accounts of the Company Liquidator filed in Tribunal, the auditor shall forward to the Registry a certificate of audit relating to the account with his observations and comments, if any, on the account, together with a copy thereof and shall forward another copy to the Company Liquidator, and the Company Liquidator shall file copy of the audit certificate together with a copy of audited accounts with the Registrar of Companies and the Registry shall file the original audit certificate with the records of the Tribunal.

97. Audit fees.- The audit fees shall be fixed by the Tribunal from time to time having regard to -the nature and complexity of the case_.

98. Inspection of account and certificate of audit.- Any creditor or contributory shall be entitled to inspect the accounts and the auditor’s certificate in the office of the Tribunal on payment of fees of one hundred rupees and to obtain a copy thereof on payment of the charges at the rate of five rupees per page.

99. Account and auditor’s report to be placed before Tribunal.- Upon the audit of the account, the Registry shall place the statement of account and the auditor’s certificate before the Tribunal for its consideration and orders.

Part III

WINDING UP BY TRIBUNAL (OTHER THAN SUMMARY WINDING UP)
DEBTS AND CLAIMS AGAINST COMPANY

100. Notice for proving debts.- (1) Subject to the provisions of the Act and directions of the Tribunal, the Company Liquidator in a winding up by the Tribunal shall, within a period of thirty days from the date of order of winding up, fix a certain day, arid give a notice of fourteen days thereof

(i) by advertisement in Form No. WIN 43 in one issue of a daily newspaper in the English language and one issue of a daily newspaper in the regional language widely circulating in the State or Union territory where the registered office is situated concerned to the creditors of the company to prove their debts or claims and to establish any title they may have to priority under section 326 or 327, or to be excluded from the benefit of any distribution made before such debts or claims are proved, or, as the case may be, from objecting to such distribution;

(ii) by such mode of communication as is permitted under section 20 to every person mentioned in the statement of affairs, as a creditor, who has not proved his debt and to every person mentioned in the statement of affairs as a preferential creditor, whose claim to be a preferential creditor has not been established or is not admitted, or where there is no statement of affairs, to the creditors as ascertained from the books of the company and, to each person who, to the knowledge of the Company Liquidator, claims to be a creditor or preferential creditor of the company and whose claim has not been admitted, to the last known address or place of residence of such person.

(2) All the rules hereinafter set out as to the admission or rejection of proofs shall apply with necessary variations to any claim to priority as a preferential creditor.

101. Proof of debt.- (1) In a winding up by the Tribunal, every creditor shall, subject as hereinafter provided, prove his debt, unless the Tribunal in any particular case directs that any creditors or class of creditors shall be admitted without proof.

(2) Formal proof of the debts mentioned in clause (d) of sub-section (1) of section 327 shall not be required, unless the Company Liquidator in any special case otherwise directs.

102. Mode of proof and verification thereof.- A debt may be proved by delivering or sending to the Company Liquidator by such mode as set out in section 20, an affidavit verifying the debt made by the creditor or by some person authorised by him and if the affidavit is made by a person authorised by the creditor, it shall state the authority and means of knowledge of the deponent and a creditor need not attend upon the examination unless required so to do by the Company Liquidator.

103. Contents of proof.- An affidavit proving a debt shall contain or refer to a statement of account showing the particulars of the debt, and shall specify the vouchers, if any, by which the same can be substantiated and the affidavit shall state whether the creditor is a secured creditor, or a preferential creditor, and if so, shall set out the particulars of the security or of the preferential claims, and the affidavit shall be in Form WIN 44.

104. Workmen’s dues.- In any case where there are numerous claims for wages or any accrued remuneration by workmen and others employed by the company, it shall be sufficient if one proof in Form WIN 45 for all such claims is made either by a foreman or some other person on behalf of all such creditors and such proof shall be annexed thereto as forming part thereof, setting forth the names of the workmen and others and the amounts severally due to them in the schedule in the said form, and any proof made in compliance with this rule shall have the same effect as if separate proofs had been made by each of the said workmen and others.

105. Production of bills of exchange and promissory notes.- Where a creditor seeks to prove in respect of a bill of exchange, promissory note or other negotiable instrument or security of a like nature on which the company is liable, such bill of exchange, note, instrument or security shall be produced before the Company Liquidator and be marked by him before the proof is admitted.

106. Value of debts.- The value of all debts and claims against the company shall, as far as is possible, be estimated according to the value thereof at the date of the appointment of the Provisional Liquidator or the order of the winding up of the company, whichever is earlier:

Provided that where before the presentation of the petition for winding up, a resolution has been passed by the company for winding up, the date for estimation of debts and claims shall be the date of the passing of such resolution.

107. Discount. – A creditor proving his debt shall deduct therefrom all trade discounts, if any.

108. Interest. – On any debt or certain sum payable at a certain time or otherwise, whereon interest is not reserved or agreed for, and which is overdue at the date of the winding up order, or the resolution, as the case may be, the creditor may prove for interest at a rate not exceeding six per cent. per annum or as decided by the Tribunal up to that date from the time when the debt or sum was payable, if the debt or sum is payable by virtue of a written instrument at a certain time, and if payable otherwise, then from the time when a demand in writing has been made, giving notice that interest will be claimed from the date of demand until the time of payment.

109. Periodical payments.- When any rent or other payment falls due at the time referred to in rule 108, and the order or resolution to wind up is made at any time other than one of those times mentioned in rule 108, the persons shall be entitled to the rent or payments for a proportionate part thereof up to the date of winding up order or resolution accrued due from day to day:

Provided that where the Company Liquidator remains in occupation of the premises demised to a company which is being wound up, nothing in this rule shall prejudice or affect the right of the landlord of such premises to claim payment by the company, or the liquidator, of rent during the period of the company’s or liquidator’s occupation.

110. Proof of debt payable at future time.- A creditor may prove for a debt not payable at the date of the winding up order, as if it were payable presently, and may receive dividends equally with the other creditors, deducting only thereat a rebate of interest at the rate of six per cent. per annum computed from the date of declaration of the dividend to the time when the debt would have become payable according to the terms on which it was contracted.

111. Examination of proof. The Company Liquidator shall, as soon as possible but not later than thirty days or within such time as may be allowed by the Tribunal on an application by the liquidator, examine every proof of debt lodged with him and the grounds of the debt and he may call for the production of the documentary proof if any referred to in the affidavit of proof or require further evidence in support of the debt, and if he requires further evidence, or requires that the creditor should attend the investigation in person, he shall fix a day and time at which the creditor is required to attend or to produce further evidence and send a notice to such creditor in Form WIN 46 by pre-paid registered post or speed post so as to reach him not later than seven days before the date fixed.

112. Company Liquidator’s right to call any person in connection with investigation.- The Company Liquidator may call upon any person whom he may deem capable of giving information respecting the debts to be proved in liquidation and may require such person to produce any documents in his custody or power relating to such debts and shall tender with the call such sum as appears to the Company Liquidator sufficient to defray the traveling and other expenses of the person called for attendance and where the person so called fails without lawful excuse to attend or produce any documents in compliance with the call or avoids or evades service, the Company Liquidator may report the same to the Tribunal and apply for appropriate orders, and the Tribunal may pass any order as it may think fit.

113. Affidavit. – For the purpose of his duties, in relation to the admission of proof of debts, where applicable, the Company Liquidator may take affidavits and the Company Liquidator may at his discretion dispense with this requirement and he may also permit the taking of an affidavit or undertaking in lieu of an oath.

114. Costs of proof.- Unless otherwise ordered by the Tribunal, a creditor shall bear the costs of proving his debt.

115. Acceptance or rejection of proof to be communicated.- As soon as possible, but not later than fourteen days, from the date of conclusion of the examination referred to in rule 1 l 1, the Company Liquidator shall, in writing admit or reject the proof in whole or in part, every decision of the liquidator accepting or rejecting a proof, either wholly or in part, shall be communicated to the creditor concerned by means permitted under section 20 when the proof is accepted or rejected, provided that it shall not be necessary to give notice of the admission of a claim to a creditor who has appeared before the liquidator and the acceptance of whose claim has been communicated to him or his agent in writing at the time of acceptance and where the liquidator rejects a proof, wholly or in part, he shall state the grounds of the rejection to the creditor in Form WIN 47, and notice of admission of proof shall be in Form WIN 48.

116. Appeal by creditor. – (1) If a creditor is dissatisfied with the decision of the Company Liquidator in respect of his proof, the creditor may, not later than twenty-one days from the date of service of the notice upon him of the decision of the liquidator, appeal to the Tribunal against the decision.

(2) The appeal shall be made in Form WIN 49, supported by an affidavit which shall set out the grounds of such appeal, and notice of the appeal shall be given to the Company Liquidator and on such appeal, the Tribunal shall have all the powers of an appellate court under the Code of Civil Procedure, 1908 (5 of 1908).

117. Procedure where creditor appeals.- (1) The Company Liquidator shall, upon receiving notice of the appeal against a decision rejecting a proof wholly or in part, file with the Registry such proof with the order containing the grounds of rejection.

(2) It shall be open to any creditor or contributory to apply to the Tribunal for leave to intervene in the appeal, and the Tribunal may, if it thinks fit, grant the leave subject to such terms and conditions as may be just, and where such leave has been granted, notice of the hearing of the appeal shall be given to such creditor or contributory.

118. Company Liquidator not to be personally liable for costs.- The Company Liquidator shall in no case be personally liable for costs in relation to an appeal from his decision rejecting any proof wholly or in part.

119. Proofs and list of creditors to be filed in Tribunal.- The Company Liquidator shall, within thirty days from the date fixed for the submission of proofs under rule 100 or such further time as the Tribunal may allow, file in the Tribunal a list of the creditors, in Form WIN 50, who submitted to him proofs of their claims in pursuance of the advertisement and the notice referred to in rule 100, mentioning the amounts of debt for which they claimed to be creditors, distinguishing in such list the proofs admitted wholly, the proofs admitted or rejected in part, and the proofs wholly rejected, and the proofs, with the memorandum of admission or rejection of the same in whole or in part, as the case may be, endorsed thereon, shall be filed in Tribunal along with the certificate.

120. List of creditors not to be varied.- The list of creditors filed in Tribunal shall be the list of the creditors of the company, and shall not be added to or varied except under the order of the Tribunal and in accordance with such orders and where an order is made adding to or varying the list of creditors, the Company Liquidator shall amend the list in accordance with such order.

121. Notice of filing list and inspection of same.- Upon the filing of the list of creditors as settled by the Company Liquidator, the Registry shall notify the filing thereof on the Tribunal’s notice board and on the website of the Tribunal, and the list of creditors as settled and the proofs relating thereto shall be open to the inspection of every creditor or contributory on payment of fee of one thousand rupees.

122. Expunging of proof.- (1) If after the admission of a proof, the Company Liquidator has reason to believe that the proof has been improperly admitted or admitted by a mistake, he may immediately apply to the Tribunal upon notice to the creditor who made the proof, to expunge the proof or reduce its amount, as the case may be.

(2) Any creditor or contributory may, within ten days of the admission of the proof, also apply to the Tribunal to expunge the proof or reduce the amount thereof, if the Company Liquidator declines to move in the matter, and on such application, the Tribunal may pass such order as it may think just.

123. Procedure on failure to prove debt within time fixed.- If any creditor fails to file proof of his debt with the Company Liquidator within the time specified in the advertisement referred to in rule 100, such creditor may apply to the Tribunal for relief within fifteen days from the time specified in such advertisement, and the Tribunal may, thereupon, adjudicate upon the debt or direct the liquidator to do so.

124. Right of creditor who has not proved debt before declaration of dividend.- Any creditor who has not proved his debt before the declaration of any dividend or dividends shall be entitled to be paid out of any money for the time being in the hands of the Company Liquidator available for distribution of dividend, any dividend or dividends which such creditor may have failed to receive before that money is applied to the payment of any future dividend or dividends, but he shall not be entitled to disturb the distribution of any dividend declared before his debt was proved by reason that he has not participated therein.

125. Payment of subsequent interest.- In the event of there being a surplus after payment in full of all the claims admitted to proof, creditors whose proofs have been admitted shall be paid interest from the date of the winding up order or of the resolution, as the case may be, up to the date of the declaration of the final dividend, at a rate not exceeding six per cent. per annum or such other rate as may be decided by the Tribunal, on the admitted amount of the claim, after adjusting against the said amount the dividends declared as on the date of the declaration of each dividend.

ATTENDANCE AND APPEARANCE OF CREDITORS AND
CONTRIBUTORIES

126. Attendance at proceedings.- (1) Save as otherwise provided by these rules or by an order of the Tribunal, every person for the time being on the list of contributories of the company and every creditor whose debt has been admitted by the Company Liquidator wholly or in part shall be at liberty at his own expense to attend the proceedings before the Tribunal or before the Company Liquidator and shall be entitled upon payment of the costs occasioned thereby to have notice of all such proceedings as he shall, by request in writing addressed to the Company Liquidator, desire to have notice of; but if the Tribunal shall be of opinion that the attendance of any such person has occasioned any additional costs which ought not to be borne by the funds of the company, it may direct such costs or a gross sum in lieu thereof to be paid by such person and such person shall not be entitled to attend any further proceedings until he had paid the same.

(2) No contributory or creditor shall be entitled to attend any proceedings before the Tribunal, unless and until he or an authorised representative on his behalf has filed an appearance with the Registry and the Registry shall keep an “Appearance Book” in which all such appearances shall be entered.

127. Representation of creditors and contributories before Tribunal.-The Tribunal may, if it thinks fit, appoint from time to time any one or more of the creditors or contributories to represent before the Tribunal at the expense of the company, all or any class of creditors or contributories upon any question or in relation to any proceedings before the Tribunal, and may remove any person so appointed, if more than one person is appointed under this rule to represent one class, and the persons so appointed, shall employ the same authorised representative to represent them, and where they fail to agree as to the authorised representative to be employed, the Tribunal may nominate an authorised representative for them.

COLLECTION AND DISTRIBUTION OF ASSETS IN WINDING UP BY TRIBUNAL

128. Powers of Company Liquidator.- The duties imposed by sub-section (1) of section 290 with regard to the collection of the assets of the company and the application of the assets in discharge of the company’s liabilities shall be discharged by the Company Liquidator subject to the control of the Tribunal.

129. Company Liquidator to be in position of receiver.- For the discharge by the Company Liquidator of the duties imposed by sub-section (1) of section 290, the Company Liquidator shall, for the purpose of acquiring and retaining possession of the property of the company, be in the same position as if he were a Receiver of the property appointed by the Tribunal, and the Tribunal may on his application enforce such acquisition or retention accordingly.

130. Company’s property to be surrendered to Company Liquidator on requisition.- Any contributory for the time being on the list of contributories, trustee, receiver, banker, agent, officer or other employee of a company which is being wound up under order of the Tribunal, shall on notice from the Company Liquidator and within such time as he shall by notice require, pay, deliver, convey, surrender or transfer to or into the hands of the Company Liquidator any money, property or books and papers in his custody or under his control to which the company is or appears to be entitled and where the person so required fails to comply with the notice, the Company Liquidator may apply to the Tribunal for appropriate orders and the notice shall be in Form WIN 51.

CALLS IN WINDING UP BY TRIBUNAL

131. Calls by Company Liquidator.- Subject to the provisions of sub sections (2) of section 465, the Tribunal may by order grant leave to the Company Liquidator to make calls referred to in section 296.

132. Company Liquidator to realise uncalled capital.- Notwithstanding any charge or encumbrance on the uncalled capital of the company, the Company Liquidator shall be entitled to call and realise the uncalled capital of the company and to collect the arrears, if any, due on calls made prior to the winding up, but shall hold all moneys so realised subject to the rights, if any, of the holder of any such charge or encumbrance.

133. Application for leave to make call.- (1) The Company Liquidator shall not make any call without obtaining the leave of the Tribunal for the purpose.

(2) Within seven days of the settlement of the list of contributories, the Company Liquidator may apply to the Tribunal for leave to make a call on the contributories and the application shall state the proposed amount of such call and shall be in Form WIN 52 which shall be supported by the affidavit of the Company Liquidator which shall be in Form WIN 53.

134. Notice of application.- (1) Notice of an application for leave to make a call shall be served on every contributory proposed to be included in such call, by post under certificate of posting so as to reach such contributory, in the ordinary course of post not less than seven clear days before the date appointed for the hearing thereof, or if the Tribunal so directs, notice of the application may be given by advertisement in Form WIN 54 , in newspapers as the Tribunal may direct, not less than seven clear days before the date appointed for the hearing, without a separate notice to each contributory.

(2) The affidavit of service relating to the dispatch of notice to each contributory, or to the advertisement, as the case may be, shall be filed in the Tribunal three days before the date fixed for the hearing.

135. Order granting leave to make call and document making call. The order granting leave to make a call shall be in Form WIN 55, and shall contain directions as to the time within which such calls shall be paid and when an order has been made granting leave to make a call, the Company Liquidator shall file in Tribunal, document making the call in Form WIN 56 with such variations as circumstances may require.

136. Service of notice of call.- Immediately after filing the document making the call as referred to in rule 135, the Company Liquidator shall serve by registered post or speed post or in electronic mode, a copy of the order granting leave to make the call upon each of the contributories included in such call together with a notice in Form WIN 57 specifying the amount or balance due from such contributory in respect of such call and the order granting leave to make a call need not be advertised unless the Tribunal otherwise orders for any special reason.

137. Order for payment of – The Company Liquidator may apply to the Tribunal for an order against any contributory or contributories for payment of moneys due on the calls made by him and the application shall be made in Form WIN 58 supported by an affidavit in Form WIN 59 and notice of the application together with a copy of the affidavit shall be served on the contributory by registered post or speed post not less than seven days before the date fixed for the hearing of the application, and the order for payment shall be in Form WIN 60.

138. Other moneys due by contributories.- When any money is due to the company from a contributory or from the estate of the person whom he represents, other than moneys due on calls made subsequent to the winding up but including moneys due on calls made prior to the winding up the Company Liquidator may make an application to the Tribunal supported by an affidavit for an order against such contributory for the payment of such moneys and the notice of the application shall be given to such contributory by registered post or speed post not less than seven days prior to the date fixed for the hearing of the application.

EXAMINATION UNDER SECTIONS 299 AND 300

139. Application for examination under section 299.- (1) An application for the examination of a person under section 299 may be made ex-parte, provided that where the application is made by any person other than the Company Liquidator, notice of the application shall be given to the Company Liquidator.

(2) The application referred to in sub-rule (1) shall be in Form WIN 61 and where the application is by the Company Liquidator, it shall be accompanied by a statement signed by him setting forth the facts on which the application is based, and where the application is made by a person other than the Company Liquidator, the application shall be supported by an affidavit of the applicant setting forth the matters in respect of which the examination is sought and the grounds, relied on in support of the application.

140. Directions at hearing of application. Upon the hearing of the application referred to in rule 139, the Tribunal may, if satisfied that there are grounds for making the order, make an order directing the issue of summons against the person named in the order for his examination or for the production of documents or both, and unless the Tribunal otherwise directs, the examination of such person shall be held in Chambers and the order shall be in Form WIN 62.

141. Service of summons.- The summons issued in pursuance of the order of the Tribunal shall be in Form WIN 63 and shall be served, in the mode as referred to in section 20, on the person to be examined not less than seven days before the date fixed for the examination, and when the summons are served in person, there shall be paid or tendered to the person summoned along with the summons a reasonable sum for his expenses to be fixed by the Tribunal or Registry with due regard to the scale of fees in force in the Tribunal and when the summons are served by registered post, such sum shall be sent to such person by postal money order.

142. Conduct of examination.- (1) The Company Liquidator shall have the conduct of an examination under section 299, provided that the Tribunal may, if for any reasons it thinks fit so to do, entrust the conduct of the examination to any contributory or creditors and where the conduct of the examination is entrusted to any person other than the Company Liquidator, the Company Liquidator shall nevertheless be entitled to be present at the examination in person or by authorised representative, and may take notes of the examination for his own use and put such questions to the person examined as the Tribunal may allow.

(2) Save as provided in sub-rule (1), no person shall be entitled to take part in an examination under section 299 except the Company Liquidator and his authorised representative, but any person examined shall be entitled to have the assistance of his authorised representative, who may re-examine the witness :

Provided that the Tribunal may permit, if it thinks fit, any creditor or contributory to attend the examination subject to such conditions as it may impose.

(3) Notes of the examination may be permitted to be taken by the witness or any person on his behalf on his giving an undertaking to the Tribunal that such notes shall be used only for the purpose of the re-examination of the witness and on the conclusion of the examination, the notes shall, unless otherwise directed by the Tribunal, be handed over to the Tribunal for destruction.

143. Notes of deposition.- (1) The notes of the deposition of a person examined under section 299 shall be signed by such person and shall be lodged in the office of the Registry, but the notes shall not be open to the inspection of any creditor, contributory or other person, except the Company Liquidator, nor shall a copy thereof or extract therefrom be supplied to any person other than the Company Liquidator, save upon orders of the Tribunal.

(2) The Tribunal may from time to time give such general or special directions as it shall think expedient as to the custody and inspection of such notes and the furnishing of copies thereof or extracts therefrom.

144. Order for examination under section 300.- (1) Where an order is made for the examination of any person or persons under section 300, the examination shall be held before the Tribunal:

Provided the Tribunal may direct that the whole or any part of the examination of any such person or persons be held before any person or authority as may be mentioned in the order and where the date of the examination has not been fixed by the order, the Company Liquidator shall take an appointment from the Tribunal, or the person or authority before whom the examination is to be held as to the date of the examination, and the order directing examination shall be in Form WIN 64.

(2) The Tribunal may, if it thinks fit, either in the order for examination or by any subsequent order, give directions as to the specific matters on which such person is to be examined.

145. Notice of examination.- Not less than seven clear days before the date fixed for the examination, the Company Liquidator shall give notice thereof to the creditors and contributories of the company by advertisement in Form WIN 65 in such newspapers as the Tribunal shall direct, and shall within the same period, serve, either personally or by registered post or by speed post, on the person or persons to be examined, a notice in Form WIN 66 of the date and hour fixed for the examination and the officer before whom it is to be held, together with a copy of the order directing the examination and where the examination is adjourned, it shall not be necessary to advertise the adjournment or serve notice thereof unless otherwise ordered by the Tribunal.

146. Adjournment of examination for orders of Tribunal.- Where on an examination held before the person or authority appointed by the Tribunal, such person or authority is of the opinion that the examination is being unduly or unnecessarily protracted or, for any other sufficient cause, he is of the opinion that the examination should be held before the Tribunal, such person or authority may adjourn the examination of any person, or any part of the examination, to be held before the Tribunal and submit his report to the Tribunal, and the Tribunal may thereupon hold the examination itself or pass such orders as it may think fit.

147. Procedure for contumacy.- (1) If a person examined before the person or authority appointed by the Tribunal refuses to answer to the satisfaction of such the person or authority any question which he may put or allow to be put, such the person or authority shall forthwith report such refusal to the Tribunal and upon such report being made, the person in default shall be in the same position and be dealt with in the same manner as if he had made default in answering before the Tribunal.

(2) The report shall be in writing and shall set forth the question or questions put and the answer or answers given, if any, by the person examined, and the person or authority shall notify the person examined of the date when he should attend before the Tribunal, and the report shall be in Form WIN 67 and upon receiving the report, the Tribunal may take such action thereon as it may think fit.

148. Notes of examination. -The notes of every examination shall, after being signed as required by sub-section (7) of section 300, form part of the records of winding up and the Company Liquidator, the person examined or contributory of the company, shall be entitled to obtain a copy thereof from the Tribunal on payment of five rupees per page.

149. Application under sub-section (5) of section 300. – An application under sub-section (5) of section 300 by any person ordered to be examined to be exculpated from any charges made or suggested against him, shall be made upon notice to the Company Liquidator and to such other persons as the Tribunal may direct.

150. Warrant of arrest of contributory. – (1) If the Tribunal is satisfied as referred to in section 301 and that notice of the date and hour fixed for the examination was duly served on such contributory, the Tribunal may, issue without any further notice, a warrant in Form WIN 68 for the arrest of the said contributory.

(2) Every warrant of arrest of the contributory issued under this rule shall remain in force until it is cancelled by the Tribunal which issued it or by the Appellate Tribunal to which appeals ordinarily lie from the decisions of such Tribunal, or until it is executed.

151. Prison to which contributory arrested on warrant is to be taken.-Where the Tribunal issues a warrant for the arrest of the contributory as referred to in section 301, the prison in which such contributory shall be detained, shall, unless the Tribunal otherwise orders, be specified in the order of the Tribunal in the exercise of its powers under the Act, and the warrant for keeping the said contributory in prison shall be in Form WIN 69 and the order of releasing him on bail shall be in Form WIN 70.

152. Execution of warrant of arrest outside jurisdiction of Tribunal. ­(1) Where a warrant has been issued by the Tribunal under these rules for the arrest of a contributory who is or is believed to be outside the jurisdiction of the Tribunal, the Tribunal issuing the warrant may send the warrant of arrest for execution to the District Court or, to the Court of Small Causes at Bombay, Calcutta or Madras (if the warrant has to be executed in any of these places) within the ordinary jurisdiction of which such contributory shall then be or be believed to be, with a requisition in Form WIN 71 annexed thereto under the seal of the Tribunal requesting execution of the warrant by the Court to which it is sent and the last mentioned Court shall seal the warrant with its seal and shall cause the arrest to be made by its own officers or by a Court subordinate to it and the concerned police officers shall aid and assist within their respective jurisdiction in the execution of such warrant.

(2) The Court making the arrest shall send the contributory arrested in proper custody to the Tribunal by which the warrant of arrest was originally issued, unless he furnishes the required security to the satisfaction of the Court for his appearance before the Tribunal, in which case the Court shall release him on such security and inform the Tribunal by which the warrant of arrest was originally issued.

APPLICATION AGAINST DELINQUENT DIRECTORS, PROMOTERS
AND OFFICERS OF THE COMPANY

153. Application under section 339 or section 340.- An application under sub-section (1) of section 339 or under sub-section (1) of section 340, shall be made by a summons returnable in the first instance in chambers and the summons shall state the nature of the declaration or order for which the application is made, and the grounds of the application, and shall be served on every person against whom an order is sought not less than seven days before the day named in the summons for the hearing of the application, and it shall not be necessary to file any affidavit or report before the return of the summons and the summons shall be in Form WIN 72 or Form WIN 73 with such variations as may be necessary.

154. Directions at preliminary hearing of summons. -On the return of the summons, the Tribunal may give such directions as it shall think fit as to whether points of claim and defence are to be delivered, as to the taking of evidence wholly or in part by affidavit or orally, as to the cross-examination, on the hearing, before the Tribunal or of any deponents to affidavits in support of or in opposition to the application, as to any report, the Tribunal may require the liquidator to make, and generally as to the procedure on the summons and for the hearing thereof, and points of claim to be delivered shall be in Form WIN 74 or Form WIN 75 with such variations as may be necessary.

155. Liberty to apply for further directions. – Where the Tribunal has directed that points of claim and defense shall be delivered, it shall be open to either party who wishes to apply for any further direction as to any interlocutory matter, to apply, by restoration of the summons, before the summons has been set down for trial, for such direction, upon giving two clear days’ notice in writing to the other party stating the grounds of the application and a copy of the notice shall be filed with the Registry, two clear day’s before the day fixed for the hearing of the application.

DISCLAIMER

156. Application for disclaimer. – (1) An application for leave to disclaim any part of the property of a company pursuant to sub-section (1) of section 333 shall be made by an application supported by an affidavit setting out the full facts relating to the property, the parties interested, the nature of their interests, and stating whether the company is solvent and whether any notice has been served on the liquidator by any person referred to in sub-section (4) of the said section requiring him to elect whether or not he will disclaim.

(2) The notice and application referred to in sub-rule (1) shall be in Forms WIN 76 to 82 with such variations as may be necessary.

157. Preliminary hearing of application. – The application referred to in rule 156 shall be posted before the Tribunal ex-parte in the first instance for directions as to the persons on whom notice of the application should be served, and the Tribunal shall thereupon fix a date for the hearing of the application and give such directions as may be necessary as to the persons on whom notice of the application should be served.

158. Claimant to furnish statement of his interest. -Where a person claims to be interested in any part of the property of the company which the Company Liquidator wishes to disclaim, such person shall, if so required by the liquidator, furnish a statement of the interest claimed by him.

159. Service of notice. – Notice of the date fixed for the hearing of the application referred to in rule 156 shall be in Form WIN 83 and shall be served not less than seven days before the date fixed for the hearing, together with a copy of the application and of the affidavit filed in support thereof, and the notice shall require that any affidavit-in-opposition to the application shall be filed in Tribunal and a copy thereof served on the Company Liquidator not later than two days before the date fixed for the hearing.

160. Order granting leave to disclaim. -On the hearing of the application referred to in rule 156, the Tribunal may after hearing the Company Liquidator and such parties as may appear in response to the notices issued, and such other persons appearing and interested as the Tribunal may think fit to hear, grant leave to the liquidator and to disclaim on such terms and conditions if any, as to the Tribunal may deem just and the order granting leave to disclaim shall be in Form WIN 84.

161. Disclaimer to be filed in Tribunal. -Every disclaimer shall be filed in Tribunal by the Company Liquidator and shall not be operative until it is so filed and where the disclaimer is in respect of a leasehold interest, it shall be filed in Tribunal forthwith; the notice of the filing of the disclaimer shall be given to the persons interested in the property; the disclaimer shall contain particulars of the interest disclaimed and a statement of the persons to whom notice of the disclaimer has been given; a disclaimer shall be in Form WIN 85, and a notice of disclaimer in Form WIN 86, and where a disclaimer has been filed in Tribunal, the Company Liquidator shall file a copy thereof with the Registrar of Companies.

162. Vesting of disclaimed property. – (I) Where the disclaimed property is a leasehold interest and an application is made under sub-section (6) of section 333 for an order vesting the property in any person and it appears that there is an under- lessee or mortgagee or holder of a charge by way of demise in respect of such property, claiming under the company, the Tribunal may direct that notice shall be given to such under-lessee, mortgagee or holder of charge, that if he does not elect to accept and apply for a vesting order upon the terms required by the above mentioned sub-section and such other terms as the Tribunal may think just, within a time to be fixed by the Tribunal and stated in the notice, he will be excluded from all interest in and security upon the property and the Tribunal may adjourn the application for such notice to be given and for such under-lessee, mortgagee or holder of charge, to be added as a party to and served with a copy of the application, and to make, if he deem fit, such election and application as is mentioned in the notice, and if at the expiration of the time so fixed by the Tribunal, such under-lessee, mortgagee or holder of charge, fails to make such election and application, the Tribunal, may make an order vesting the property in the applicant or other person who, in the opinion of the Tribunal, may be entitled thereto, and excluding such under-lessee, mortgagee or holder of charge, from all interest in or security upon the property.

(2) An order requiring parties interested in a disclaimed lease to apply for a vesting order or to be excluded from all interest in the lease shall be in Form WIN 87, and an order vesting lease and excluding persons who have not elected to apply, shall be in Form WIN 88.

COMPROMISE OR ABANDONMENT OF CLAIMS

163. No claim to be compromised or abandoned without sanction of Tribunal. -In a winding up by the Tribunal, no claim by the company against any person shall be compromised or abandoned by the Company Liquidator without the sanction of the Tribunal upon notice to such person as the Tribunal may direct.

164. Application for sanction of compromise. -Every application for sanction of a compromise or arrangement referred to in clauses (ii) and (iii) of sub- section (1) of section 343 shall be accompanied by a copy of the proposed compromise or arrangement and shall be supported by an affidavit of the Company Liquidator, along with final report of the Advisory committee, stating that for the reasons set out in the affidavit he is satisfied that the proposed compromise or arrangement is beneficial to the company.

SALE BY COMPANY LIQUIDATOR

165. Sale to be subject to sanction and to confirmation by Tribunal. – Unless the Tribunal otherwise orders, no property or asset belonging to company which is being wound up by the Tribunal shall be sold by the Company Liquidator without the previous sanction of the Tribunal, and every sale shall be subject to confirmation by the Tribunal.

166. Procedure at sale. – Every sale shall be held by the Company Liquidator, or, if the Tribunal shall so direct, by an agent or an auctioneer approved by the Tribunal, and subject to such terms and conditions, if any, as may be approved by the Tribunal and all sales shall be made by public auction or by inviting sealed tenders or by electronic bidding or in such manners as the Tribunal may direct.

167. Expenses of sale. – Where property forming part of a company’s assets is sold by the Company Liquidator through an auctioneer or other agent, the gross proceeds of the sale shall, unless, the Tribunal otherwise orders, be paid over to the liquidator by such auctioneer or agent and the charges and expenses connected with the sale shall afterwards be paid to such auctioneer or agent in accordance with the scales, if any, fixed by the Tribunal.

DIVIDENDS AND RETURNS OF CAPITAL IN WINDING UP BY  TRIBUNAL

168. Declaration of dividend or return of capital. – No dividend to creditors or return of capital to contributories shall be declared by the Company Liquidator without the sanction of the Tribunal.

169. Notice of declaration. -The Company Liquidator shall give notice of the declaration of dividend not less than fifteen days prior to the date fixed for the payment thereof and unless otherwise directed by the Tribunal, such notice shall be given by advertisement in such newspapers as the Tribunalshall direct and by sending by registered or speed post and electronic mode if any., a notice to every person whose name appears in the list of creditors as on such date and the advertisement shall be in Form WIN 89 and the notice to creditor in Form WIN 90.

170. Form of authority to pay dividend. -A person to whom dividend is payable may lodge with the Company Liquidator an authority in writing to pay such dividend to another person named therein and such authority shall be in Form WIN 91.

171. Transmission of dividends, etc. by post. -Dividends and returns of capital may, at the request and risk and cost of the person to whom they are payable, be transmitted to him by money order, or to his bank account through electronic means as may be appropriate.

172. Form of order directing return of capital. -Every order by which the Company Liquidator is authorised to make a return to contributories of the company, shall, unless the Tribunal otherwise directs, contain or have appended thereto a schedule or list (which the Company Liquidator shall prepare) setting out in a tabular form the full names and addresses of the persons to whom the return is to be paid, and the amount of money payable to each person, and particulars of the transfers of shares (if any) which have been made or the variations in the list of contributories which have arisen since the date of the settlement of the list and such other information as may be necessary to enable the return to be made and the schedule or list shall be in Form WIN 92 with such variations as circumstances shall require and the Company Liquidator shall send a notice of return to each contributory by registered or speed post and electronic mode if any in Form WIN 93.

173. Payment of dividend or return of capital due to deceased creditor or contributory. – Where a claim made in respect of a dividend due to a deceased creditor or a return of capital due to a deceased contributory is one lakh rupees or less, the Company Liquidator may, upon satisfying himself as to the claimant’s right and title to receive the dividend or the return, as the case may be, apply to the Tribunal for sanctioning the payment of such dividend or return to the claimant without the production of a succession certificate or like authority, however, in respect of the claim mentioned above, pertaining to a deceased creditor or contributory where the claim amount is one lakh rupees or less, in lieu of succession certificate, the claimant shall produce Family Member Certificate issued by competent authority in the State Government or Union territory, as the case may be, and where the Tribunal sanctions the payment, the Company Liquidator shall make the payment upon obtaining a personal indemnity as well as an affidavit duly stamped from the payee.

TERMINATION OF WINDING UP

174. Company Liquidator to apply for dissolution. – After the affairs of the company have been fully wound up and final accounts thereof are audited, the Company Liquidator shall apply to the Tribunal within ten days along with audited final accounts and auditors certificate thereon for orders as to the dissolution of the company.

175. Dissolution of company. – Upon the hearing of the application, the Tribunal may, after hearing the Company Liquidator and any other person to whom notice may have been ordered by the Tribunal, upon perusing the account as audited, make such orders as it may think fit as to the dissolution of the company, the application, subject to the provisions of the Act, of the balance in the hands of the Company Liquidator or the payment thereof into the Company Liquidation Dividend and Undistributed Assets Account, and the disposal of the books and papers of the company and of the liquidator.

176. Liquidator to pay the balance into Company Liquidation Dividend and Undistributed Assets Account. -Upon an order for dissolution being made, the Company Liquidator shall forthwith pay into the Company Liquidation Dividend and Undistributed Assets Account any unclaimed dividends payable to creditors or undistributed assets refundable to contributories in his hands on the date of the order of dissolution, and such other balance in his hands as he has been directed by the Tribunal to deposit into the Company Liquidation Dividend and Undistributed Assets Account and every order of dissolution shall direct that the Company Liquidator shall forward a certified copy of the order to the Registrar of Companies not later than seven days from the date of the order, and along with the copy of the order shall be filed with the Registrar of Companies, a statement signed by the Company Liquidator that the directions of the Tribunal regarding the application of the balance as per his final account have been duly complied with.

177. Conclusion of winding up. – The winding up of a company shall, for purposes of section 302, be deemed to be concluded at the date on which the order dissolving the company has been reported by the Company Liquidator to the Registrar of Companies unless any fund or assets of the company remaining unclaimed or undistributed in the hands or under the control of the Company Liquidator, have been distributed, or paid into the Company Liquidation Dividend and Undistributed Assets Account as provided in section 352.

178. Application to declare dissolution void.-An application under section 356 shall be made upon notice to the Central Government and the Registrar of Companies and where the Tribunal declares the dissolution to have been void, the order shall direct that the applicant shall file a certified copy of the order with the Registrar of Companies not later than twenty-one days from the date of the order.

PAYMENT OF UNCLAIMED DIVIDENDS OR UNDISTRIBUTED ASSETS INTO THE COMPANY LIQUIDATION DIVIDEND AND UNDISTRIBUTED ASSETS ACCOUNT IN A WINDING UP

179. Statement to accompany payment. – (1) The statement to be furnished, under section sub-section (3) of 352 to the Registrar of Companies, by the liquidator when making any payment of unclaimed dividends or undistributed assets into the Company Liquidation Dividend and Undistributed Assets Account in a scheduled bank under sub­-sections (1) and (2) of the said section, shall be in Form WIN 94.

(2) The liquidator shall, whenever called upon by the Registrar of Companies so to do , certify whether a person claiming payment from the Company Liquidation Dividend and Undistributed Assets Account under sub-section (7) of section 352 is or is not entitled to the whole or any part of the amount claimed.

180. Unclaimed dividends or undistributed assets under investment.-For purposes of payment of unclaimed dividends and undistributed assets into the Company Liquidation Dividend and Undistributed Assets Account, money invested or deposited at interest by the liquidator shall be deemed to be money in his hand, and when such money forms part of the unclaimed dividends or undistributed assets of the company, the liquidator shall realise the investment or withdraw the deposit and shall pay the proceeds into the Company Liquidation Dividend and Undistributed Assets Account.

181. Application by person for payment of money paid into the Company Liquidation Dividend and Undistributed Assets Account.- An application under sub-section (6) of section 352 by any person claiming to be entitled to any money paid into the Company Liquidation Dividend and Undistributed Assets Account for payment of such money shall state whether the applicant had made an application to the Central Government for the payment, and, if so, the result of the application.

182. Cost and expenses payable out of the assets in a winding up by  Tribunal. – (1) The assets of a company in a winding up by the Tribunal remaining after payment of the fees and expenses properly incurred in preserving, realising or getting in the assets shall, subject to any order of the Tribunal and to the rights of secured creditors if any, be liable to the following payments which shall be made in the following order of priority, namely :-

First- the taxed costs of the petition including the taxed costs of any person appearing on the petition, whose costs are allowed by the Tribunal;

Next-the costs and expenses of any person who makes, or concurs in making, the company’s statement of affairs;

Next-the necessary disbursements of the Company Liquidator other than expenses properly incurred in preserving, realising or getting in the properties of the company;

Next-the cost of any person properly employed by the Company Liquidators;

Next-the cost, charges and expenses incurred by the liquidator;

Next-the actual out of pocket expenses necessarily incurred by the members of the advisory committee, and sanctioned by the Tribunal.

(2) Save as otherwise ordered by the Tribunal, no payments in respect of bills of authorised representatives, shall be allowed out of the assets of the company without proof that the same have been considered and allowed by the taxing officer of the Tribunal and the taxing officer shall before passing the bills or charges of an authorised representative, satisfy himself that the appointment of an authorised representative to assist the liquidator in the performance of his duties has been duly sanctioned.

(3) Nothing contained in this rule shall apply to or affect costs which, in the course of legal proceedings by or against the company which is being wound up by the Tribunal, are ordered by the Tribunal in which such proceedings are pending, to be paid by the company or the liquidator, or the rights of the person to whom such costs are payable.

PART IV

COSTS, ETC.

183. Costs in the discretion of Tribunal. – Costs shall be in the discretion of the Tribunal and no costs of, or incidental to, a proceeding shall be allowed between party and party, unless the same are expressly awarded by an order of the Tribunal.

184. Bill of costs by authorised representative, etc. employed by Company Liquidator.- Every authorised representative, accountant, auctioneer or other person employed by the Company Liquidator in a winding up by the Tribunal, shall, on request by the Company Liquidator (to be made in sufficient time before the declaration of a dividend) deliver his bill of costs or charges to the Company Liquidator, and if he fails to do so within four weeks of the receipt of the request or such extended time as the Tribunal may allow, the Company Liquidator shall declare and distribute the dividend without regard to such person’s claim and the claim shall be forfeited :

Provided that the Tribunal may, at any time before the declaration of the final dividend, for good cause shown, restore the claim and order the bill to be received without prejudice to the distribution of dividends declared prior to the making of the order, and the request by the Company Liquidator shall be in Form WIN 95 and shall be served personally or by registered post or speed post.

185. Fees in misfeasance proceeding.-In a proceeding against the persons referred to in sections 339 or 340, the fees to authorised representatives shall be allowed as decided by the Tribunal having regard to the nature and complexity of the case.

186. Fees when proceeding is compromised.-Where a proceeding is compromised prior to its being set down for hearing, the fees to be allowed to authorised representatives of the parties shall be as decided by the Tribunal having regard to the nature and complexity of the case.

187. Costs of parties having common interest.- (1) Where two or more petitions or applications raise a common issue and are heard together and decided by a common judgment, unless the Tribunal otherwise orders, only one set of costs shall be allowed to all the parties together in the said petitions or applications who have a common interest.

(2) Where different parties in the same proceeding have a common interest, only one set of fees shall be allowed to all of them together, though they may be represented by different authorised representatives, unless the Tribunal otherwise orders.

188. Tribunal’s power to fix a fee. – (1) Nothing in these rules shall be deemed to prevent the Tribunal from fixing a fee for any matter if in any particular case the Tribunal considers it necessary to do so in the interest of justice.

(2) In any case where the contest has not been of a substantial nature, the Tribunal may direct that the costs shall be on the uncontested scale.

189. Allowance to witnesses.-The allowances to be made to witnesses shall be on the scales as determined by the Tribunal.

PART V

SUMMARY PROCEDURE FOR LIQUIDATION

190. Powers and functions of Official Liquidator. – (1) The Official Liquidator shall exercise the powers and perform the duties as specified in the Act and these rules.

(2) For the purpose of clause (ii) of sub-section (1) of section 361 , the class of companies shall be as under, based on the latest audited Balance Sheet:-

(a) the company which has taken deposit and total outstanding deposits is not exceeding twenty five lakh rupees; or

(b) the company of which the total outstanding loan including secured loan does not exceed fifty lakh rupees; or

(c) the company of which turnover is upto fifty crore rupees; or

(d) the company of which paid up capital does not exceed one crore rupees.

(3) The Official Liquidator shall maintain the Registers and books of accounts in the manner provided in rules 79 and 80.

(4) For the purpose of filing and audit of the Official Liquidator’s accounts, the procedure laid down in the preceding rules 91 to 99 shall be followed with the modification that wherever the word Tribunal is mentioned, it shall be read as Central Government and with further directions issued by the Central Government as may be necessary, from time to time.

(5) The Official Liquidator shall dispose of all the assets in the manner as described in preceding_ rules 165 to 167 with the modification that wherever the word Tribunal is mentioned, it shall be read as Central Government and with further directions issued by the Central Government as may be necessary, from time to time.

(6) The monies received by the Official. Liquidator as referred to in section 349 shall be paid by him into the public account of India in the Reserve Bank of India as mentioned in that section not later than the next working day of the said Bank.

(7) For the purposes of section 363, the creditors of the company shall prove their claim in the manner as provided under rules 100 to 125, with the modification and directions by Central Government as mentioned in sub-rule (4).

(8) In the absence of any rules under this Part, on any subject for conduct of liquidation proceeding by the Official Liquidator, the relevant rules in the other Parts of these rules shall be followed with necessary modifications as directed by the Central Government.

Part VI.

MISCELLANEOUS

191. Inspection of file. – (1) Every duly authorised officer of the Central Government and, save as otherwise provided by these rules, every person who has been a director or officer of a company which is being woundup, shall be entitled, free of charge, at all reasonable times to inspect the file of proceedings of the liquidation, and to take copies or extracts from any document therein on payment at the rate of five rupees per page, to be furnished with such copies or extracts.

(2) Save as otherwise provided by these rules, every contributory and every creditor, whose claim or proof has been admitted, shall be entitled, at all reasonable times to inspect the file of proceedings on payment of one hundred rupees and to be furnished with copies and extracts from any document therein at the rate of five rupees per page.

Read Full Text of the Notification with Forms Page No. 68 to 252 of the Notification

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