How to proceed with winding up of company


I own less than 15% shares in a pvt. limited company and i'm an executive director of the company. While the other directors have already resigned there is still a assistant director with me with similar shareholding. Our company is not operational. I wish to close the company, but some shareholders may not agree with the same. How should i go about closing or relieving myself of the company affairs as director?

Answers (2)


167 votes

Hi.

You can choose Voluntary Winding up route to wind up your company. However if the other shareholders are not letting you wind up then make a third party raise an invoice to the company. As the company does not have money to pay the third party can file a winding up petition under the Bankruptcy Code. Best way out of this problem


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262 votes

Winding up initiated by the company itself is called Voluntary Winding up. Since you are an executive director, you have rights to initiate winding up procedures of the Company at a Board Meeting. The Directors must pass a Special Resolution to that effect. As a director you may also be required to submit an Affidavit that in your opinion, winding up is in the best interest of the Company - there are certain particulars that must be in this affidavit (please see Section 305 of Companies Act, 2013). Secondly, immediately after passing the Special Resolution, you must convene a meeting with all the creditors (if any) after giving notice, in order to obtain their input. (please see section 306 of the Companies Act 2013). Thirdly, appoint a Company Liquidator and inform the Registrar of Companies. Please see the relevant provisions of the Companies Act 2013 as it is imperative that the company be wound up correctly. Alternatively, you may resign in accordance with the Articles of the Company.

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