winding up of company through the court

1. COMPANY ACT 2017: WINDING
UP BY COURT page(161-170)
Presented By:
Sana Ullah, Roll no 26
Quaid-e-Azam College of Commerce

2. 301. Circumstances in which a company may be wound up by Court
A company may be wound up by the court:
(a) If the company has, by special resolution, resolved that
the company be windup by the court; Or
(b) If default is made in delivering the statutory report to the
registrar or in holding statutory meeting; or
(c) If default is made in holding any two consecutive annual
general meeting; or
(d) If default is made in filing financial statement or annual
return for immediately preceding two consecutive financial
year; or
(e) if the number of member is reduced incase of ; or
(f) if the company is unable to pay its debts ; or

3. Circumstances in which con….
(g) If the company is:
i. conceived or brought forth for, or is or has been caring on unlawful or
fraudulent activities: or
ii. carrying on business prohibited by any law in force, or restricted by
any law, rules or regulation for the time being in force in Pakistan; or
iii. conducting its business oppressive to the minority member concerned
with the promotion or formation of company; or
iv. run and managed by person who fail to maintain proper and true
accounts, or commit fraud, misfeasance or malfeasance in relation to
the company
v. managed be person who refuse to act according to the requirement
of memorandum or articles or provision of this act or failed to carry
out the direction or decision of commission or the registrar; or

4. Circumstances in which con….
h) If being listed company, it ceases to be such company; or
i) If the court is of opinion that its just and equitable that the
company should be wound up
j) If company’s member has finished; or
k) If the sole business of a company is licensed activity and shutoff
their operations upon cancellation of license granted by
commission or any other licensing authority; or
l) If a license granted under sec 42 to a company has been revoked or
such company has failed to comply any of the provision of sec 43 or
where a company licensed under sec 42 is being wound up
voluntarily and the liquidator has failed winding up proceeding
within a period of one year from the date of commencement of its
winding up; or
m)If a listed company suspends/stop its business for whole year.

5. 1) The promotion or carrying on of any scheme or business can be described:
Explanations of terminologies
a) Where in return for deposit or contribution, whether periodically or otherwise,
of sum of money in cash or by means of coupons, certificates, tickets or other
documents, payment, at future date or grant of property, right or benefit,
directly or indirectly, and whether with or without any right or benefit determine
by chance of lottery or any other like manner, is assured or promised;
b) Raising up un-authorised deposit deposits from the general public, indulging
referral marketing, MLM, pyramid and ponzi Scheem, in locally or internationally,
c) Any other business notified by commission to be against public policy
Shall be deemed to be unlawful
2) Minority member means member together not holding less than 10% equity shares
capital of the company.

6. 302. Company when deemed unable to pay its debts.
A company shall be deemed unable to pay its debt:
a) If a creditor, to whom the company is indebted amount more than
100,000 Rs but he/she notify the company, to pay the due amount
through the registered post office or at its registered office and the
company has for thirty days neglected to pay the due amounts, and did
not satisfy the creditor; or
b) If prove to the satisfaction of court that the company is unable to pay
its debts, in determining whether a company is unable to pay its debts,
the court shall take into account the contingent or prospective liabilities
of the company or:
c) Execution or other processes issued on a decree or order of any court
or any other competent authority in favour of creditors is return un
satisfied in whole or part
(2) The demand referred to in clause aforesaid clause 1 shall be deemed
to have been given on creditor hand if is signed by agent or by legal
advisor

7. 303. Transfer of proceeding to another court:
If it thinks fit, the court may direct all
subsequent proceedings to be held in any
other high court with the consent of any
such court for the purpose of winding of a
company, the ‘court’ shall be deemed within
the meaning of this act, shall have all power
and jurisdiction.

8. Petition for winding up
304. Provisions as to application for winding up:
Application for winding up to the court shall be petition
presented, subject to provision of this section, either by
company, or by any creditor or creditors (including any
contingent or prospective creditor or creditors) or by
contributory or contributories, or by all or any of the
aforesaid parties, together or separately or by the registrar,
or by the commission or by a person authorized by
commission:

9. Petition for winding up con….
Provided that___
a) A contributory shall not be entitled to present a petition unless
i. either the number of member is reduced,
ii. the shares in respect of which he is contributory or some of them
either originally allotted to him or have been held by him, and
registered in his name, for at least one hundred and eighty days
during the 18 month before the commencement of winding up, or
have or transfer to him through the death of formal holder
b) The registrar shall not be entitled to present a petition for
winding up unless the previous sanction of the commission has
been obtain to the presentation of petition:

10. c) The commission or person authorized by him shall not be entitled to
present petition, unless and investigation to affairs of the company, has
revealed that it was formed for any fraudulent or unlawful purpose or
carrying on a business not authorized by its memorandum or oppressive
to any member, or the management has been guilty of fraud, mis-
feasance or misconduct towards its company or towards its member;
such petition will not be presented by the commission unless the
company has been afforded an opportunity of being heard:
Petition for winding up con….
Provided that if sole business of the company is the licensed
activity and that licensed is revoked, no investigation is required to
present the petition for Winding up of the company

11. Petition for winding up con….
(d) The court shall not give a hearing to petition for winding up a company
by a contingent or prospective creditor until security for costs has been
given as the court thing reasonable, and until prima facie case for winding
up has been established to the satisfaction of the court:
(e) the Court shall not give a hearing to a petition for winding up a company by the
company until the company has furnished with its petition, in the prescribed
manner the particulars of its assets and liabilities and business operations and the
suits or proceedings pending against it.

12. 305. Right to present petition where company is being
wound up voluntarily or subject to supervision of court
1)Where such any of the modes is adopted for
winding up, a petition may be presented by any of
the person specify in section 304 and subject to
provision of that section.
2)The court shall not make winding up order a petition
presented under subsection (1) unless it is satisfied
that the voluntary winding up or subject to
supervision of court can not be continued with the
interests of creditor or contributories or both in
public interest to do.

13. 306.Commencement of winding up by court:
A winding of a company shall be deemed to
commence at the time of presentation of petition
for the winding up
Power of court in hearing application
307. Court may grant injunction : the court may
at any time after presentation of petition for
winding up under this act and before making an
order for winding up, upon application of
company itself of any its creditors or
contributories, restrain further proceeding
against the company, upon such term as the
court thin may fit.

14. 308:Power of court on hearing petition:
The court may, on receipt of petition for winding up
pass the following order:
a)Dismiss it with or without cost
b)Make an interim order as it think fit
c)Appoint a provisional manager of the company
till the making of winding order;
d)Make an order for the wining up of the
company with or with out costs; or
e)Any other order as it think fit:

15. 308:Power of court on hearing petition on
hearing petition:
Provided that order shall be made within in ninety days from the
date of presentation of petition
Provided further that before appointing a provisional manager,
the court shall give notice to the company for his
representation.
Provided also that the court shall not refuse to make winding up
order on the ground only the company have been mortgaged for
an equal amount or excess of those assets.
9) Where a petition is presented only on the ground that its just
and equitable to be wound up the court may refuse to make an
order, because of thy neglecting other remedies.
3) Where the court makes an order, Shall forthwith cause
intimation thereof to send to official liquidator appointed by it
and to registrar.

16. 309. Copy of winding up order to be filed with
registrar.____
(1)within fifteen days from the date of making of
order, the petitioner in the winding up proceedings and the
company shall file a certified copy of order with the registrar.
(2) If default is made in complying with the forgoing provision,
the petitioner, as the case may require, the company and
every officer of the company who is in default, shall be liable
to a penalty of level 1 on the standard scale.
(3) On filing of a certified copy of winding up order, the
registrar shall forthwith make a minute thereof in his book
relating to a company and shall notify in the official Gazette
that such on order has been made.
(4) Such order deemed to be notice of discharge of the
employees of the company , except when the business is
continued.

17. 310. Suit stayed in the winding
up order___
1. When an order has been made or a provisional manager has
been appointed, no suit or other legal proceeding shall be
proceeded with or against the company except by leave of
court, and subject to such terms as the court may impose.
2. The court which is winding up the company shall,
notwithstanding anything contained any other law for the
time being , have jurisdiction to entertain, or dispose of, any
suit proceeding against the company.
3. Any suit proceeding against the company which is pending
in any court other than that in which the winding up of
company is proceeding, notwithstanding any thing
contained in other law for the time being enforce, be
transferred to and dispose of by the court.

18. 311. Court may require expeditious disposal of
suit____
Notwithstanding any thing contained in any other law____
a) If any suit or proceedings, including an appeal, by or against the company
which is allowed to proceeded with in any other court other than the court
which is winding up of a company is proceeding, the court may issue
directions to other court if that court is subordinate to it, and make request
of expeditious disposal of to that other court in which proceeding is pending
by or against the company; and
b) If any proceeding including proceedings for assessment or recovery of tax,
duty or levies or appeal or review petitions against any order is pending or is
likely to instituted, before any officer, authority or other body, the court may
issue direction to authority, officer or other body, for expeditious disposal of
suit of the said proceeding.
c) Upon issue of direction to the authority etc to whom the same is addressed
shall, notwithstanding any thing contained, proceed to dispose of the said
suit or other proceeding expeditiously dispose of by according t special
priority, and shall inform the court issuing the direction.

19. 312.Effect of winding up order.___
An order for winding up a company shall operate in favour of
all creditors and of all contributories, the company as if made
on the joint petition of a creditor and of a contributory.
313. Power of court to stay of winding
up.____
the Court may at any time not letter than 3 years after
an order of winding up, an application of creditor or
contributory or of registrar or the commission or a person
authorized by it, and on proof to the satisfaction of the court
that all proceedings in relation to winding up ought to be
stayed, the court shall stayed, withdrawn, cancelled or
revoked, make an order on such terms and condition as the
court think fit.

20. 313. Power of court to stay of winding up. con…
(2) On the application, the court before
making an order, require the official
liquidator to furnish to the court a report
with respect to any facts or matters which
are in his opinion relevant to application.
(3) A copy of every order shall be
forwarded to the registrar , who shall make
a minute of the order in his book relating to
a company.

21. Court may ascertain wishes of creditors or
contributories.
1) in matter relating to winding up of a company,
the court may__
a) Have regard to wishes of creditors or contributories of
the company, as proved to it by any sufficient evidence in
manner as provided under this Act;
b) If it thinks fit for the purpose of ascertaining the wishes,
the court may call for a meeting of booths parties.
c) Appoint a person as a chairman for such meeting to
submit a report
2) While ascertaining the wishes of creditors or
contributories, regard shall be had to the value of each
debt of the creditors or voting power of contributories.

22. Official liquidators
315. Appointment of official liquidators.____
1) For the purpose of the winding up of companies by the court, the
commission shall maintain a panel of person from whom the
court shall appoint a provisional manager or official liquidators of
a company ordered to be wound up.
2) A person shall not be appointed as a provisional manager or
official liquidators of than three companies at one point of time.
3) Shall consist of a persons having at leas ten year experience in
the field of accounting, finance or law and may be specified by
commission and such other person having at least 3 Year
professional experience.
4) Where a provisional manager is appointed the court may limit or
restrict his powers, otherwise he shall have the same power as a
liquidator

23. 315. Appointment of official liquidators.____ con….
5) The liquidators or provisional manager which or appointed shall
file declaration within 7 days from the date of appointment in the
specified form disclosing their conflict of interest or lack of
independence.
6) While pass on winding order the court may appoint a provisional
manager as a official liquidators for the purpose of proceeding for
winding up of company
7) If more persons than one are appointed in the office of official
liquidator, the court shall declare whether any act by this act
required or authorized to be done by official liquidators is to be
done by all or any one more of such person.
Provide that incase of dispute or any varying stance amongst
the liquidators, the matter shall be referred to the court for
appropriate order

24. 315. Appointment of official liquidators.____ con….
8) The court may determine whether any, and what security
to be given
9) Notwithstanding any thing contained in sub-section 1 the
court, on application of creditors to whom amounts not
less than sixty percent of the issued share-capital of the
company being wound up are due, after notice to the
registrar, appoint a person whose name does not appear
on the panel maintained for the purpose, to be official
liquidator.
10)An official liquidators shall not resign or quit his office
before conclusion 0f liquidation process, except for reason
of personal disability.

25. 315. Appointment of official liquidators.____ con….
11)Any casual vacancy in the office of an official liquidators
occurred due to his death, removal or resignation, shall filled
by the court by appointment of another person.
12)The commission may of its own remove the name of any
person from the panel maintained under sub section 1, due to
misconduct, fraud, misfeasance, breach duties or professional
incompetency’s
Provided that before remove him from the panel shall give an
opportunity of being heard.
13) The person appointed on the panel under this section shall
be subject to such of conduct and comply with the requirement
of any professional accreditation programs as may be specified
by commission.

26. Thank you for your
attention, if you
any question?