Winding up is a means by which the dissolution of a company is brought about and its assets are realized and applied in the payment of its debts. After satisfaction of the debts, the remaining balance, if any, is paid back to the members in proportion to the contribution made by them to the capital of the company.” 1. “The liquidation or winding up of a company is the process whereby its life is ended and its property is administered for the benefit of its creditors and members. An Administrator, called a liquidator, is appointed and he takes control of the company, collects its assets, pays its debts and finally distributes any surplus among the members in accordance with their rights.” Voluntary liquidations under the Insolvency and Bankruptcy Code (IBC) are becoming popular for promoters to close down 'unviable' companies. The Quarterly Newsletter (April-June 2019) issued by Insolvency and Bankruptcy Board of India (IBBI), the insolvency regulator, shows as many as 452 companies have filed for voluntary liquidation till 30 June 2018. Of that, 56 firms have so far been dissolved, final reports have been submitted in 114 cases and 338 are at different stages of the process. A company can file for voluntary resolution only if it has no debts or promises to pay the debt in full from the proceeds of assets to be sold under voluntary liquidation process. The application of voluntary liquidation should not also be to defraud any person.

1. PRESENTATION ON WINDING UP
UNDER IBC AND CSR
Presentation By
Shubham
Aayushi Singh
Himanshu Jain
Tuhina Priya
Shivam Sharma
Sonali Jain

2. Meaning of Winding Up:
• “Winding up is a means by which the dissolution of a company is
brought about and its assets are realized and applied in the payment
of its debts. After satisfaction of the debts, the remaining balance, if
any, is paid back to the members in proportion to the contribution
made by them to the capital of the company.”
• 1. “The liquidation or winding up of a company is the process
whereby its life is ended and its property is administered for the
benefit of its creditors and members. An Administrator, called a
liquidator, is appointed and he takes control of the company, collects
its assets, pays its debts and finally distributes any surplus among the
members in accordance with their rights.”

3. Meaning of Winding Up: (continued)
• 2. As per Section 2(94A) of the Companies Act, 2013, “winding up”
means winding up under this Act or liquidation under the Insolvency
and Bankruptcy Code, 2016.
• Thus, winding up ultimately leads to the dissolution of the company.
In between winding up and dissolution, the legal entity of the
company remains and it can be sued in a Tribunal of law.

4. Modes of Winding Up of a Company:
• A company may be wound up in any of the following two ways:
• 1. Compulsory Winding Up of a Company:
• Winding up a company by an order of the Tribunal is known as
compulsory winding up.
• A petition for compulsory winding up of a company may be filed in
the Tribunal by any of the following persons. (Sec. 272)
-Petition by the Company
-Petition by the Contributories
-Petition by the Registrar
-Petition by the Central Government or a State Government
-Any person authorised by the Central Government in that behalf

5. Modes of Winding Up of a Company: (continued)
• 2. VOLUNTARY WINDING UP
• The company and its creditors may apply to court for directions or
orders but usually they are left to settle their affairs within
themselves. There are two kinds of voluntary winding up,
-Resolution for Voluntary winding up
-Members’ Voluntary Winding up
-Creditors’ Voluntary Winding up

6. Indian Bankruptcy code 2016
• Insolvency and Bankruptcy Code, 2016 basically consolidates the
insolvency laws for various entities under a single legislation. It is
equally applicable to companies, partnership firms, and limited
liability partnership firms. What Insolvency and Bankruptcy Code,
2016 have empowered to creditors is the time-bound resolution to
their insolvency process rather than must dwell for years to get their
money back from a company going on a bad debt. This Code
empowers creditors and thus gives them the freedom to lend money
to Indian entrepreneurs with ease.
• Voluntary winding up of private limited company procedure was
made part of Insolvency and Bankruptcy Code, 2016 in Chapter 5 of
Part II. As per Section 59 of IBC Code 2016, a person from corporate
who has not committed any default could initiate a voluntary winding
up.

7. Winding up under IBC 2016
A circumstance under which a company could be wound up by the Tribunal
are as follows –
• If a special resolution has been passed by the Tribunal for winding up of
the company.
• If it is found that company has acted against the sovereignty, integrity, and
security of India's friendly relations with foreign states.
• If Tribunal has found that company have enacted fraudulently or in an
unlawful manner.
• If the concerned people of the company especially management are found
to be guilty of fraud or misconduct.

8. Winding up under IBC 2016 (continued)
• If the company is found to be a defaulter in filing its financial
statements for preceding financial years with Company Registrar.
• In the case for any reason, Tribunal thinks that a company should be
wound up.

9. Winding up under IBC 2016 (Continued)
As per the resolution passed on 7th Dec 2016, the pending cases were
passed on to NCLT as per below criteria –
• If the Winding-up was happening under the supervision of the court, then
it would be retained by the High Court.
• All voluntary winding up cases filed up to 31st March 2017 would be
retained by the High Court and for all new cases from 1st April 2017, NCLT
would be taking charge.
• When a company needs to get wind up for inability to pay, and the petition
is served then High Court will take care of it. In case of a petition, have not
yet been served then it would fall under IBC 2016.
• When winding up must be done by Court, then is the petition is served on
Respondent, then High Court will take care of it. However, if the petition
has never been served on Respondent, then it would fall under Insolvency
and Bankruptcy Code, 2016.

10. Corporate Social Responsibility (CSR)
“Corporate social responsibility (CSR) is a self-regulating business
model that helps a company be socially accountable — to itself, its
stakeholders, and the public.”
India is the first country in the world to make corporate social
responsibility (CSR) mandatory, following an amendment to the
Companies Act, 2013 in April 2014. Businesses can invest their profits
in areas such as education, poverty, gender equality, and hunger as part
of any CSR compliance.

11. CSR under COMPANIES ACT 2013
The amendment notified in the Companies Act, 2013 requires following
criteria to be fulfilled by corporations to be eligible for CSR:
Criteria-
1. net worth of INR 500 crore (US $70 million) or more
or
2. annual turnover of INR 1000 crore (US $140 million) or more
or
3. net profit of INR 5 crore (US $699,125) or more
Action-
Eligible corporations will need to spend 2% of its average net profit
made during 3 immediately preceding Financial years CSR activities

12. CSR Committee
In order to formulate and monitor CSR policy of a company , a CSR
committee of the board needs to be constituted which will include at least 3
directors including one independent director.
Responsibility of CSR committee will be as following:
1. Formulating and recommending to the Board, CSR Policy and the
activities to be undertaken by the Company.
2. Approval of the CSR policy.
3. Ensuring its implementation.
4. Disclosure of the contents of CSR policies related to its report, Placing
the same on Company’s website.
5. Ensuring that statutory specified amount is spend by the company with
reference to CSR activities.

13. CSR Committee (continued)
6. If the particular amount is not spent on CSR activities. In such case,
the board’s report must identify the reason for such short spending.
7. Recommending amount of expenditure to be incurred on activities
undertaken.
8. To constitute Management Committee for implementation and
execution of CSR initiatives/ activities.
9. Reviewing performance of the Company in the areas of CSR.
10. Monitoring CSR Policy from time to time

14. Activities to be undertaken under CSR
The following activities can be performed by a company to accomplish
its CSR obligations:
• Eradicating extreme hunger and poverty
• Promotion of education
• Promoting gender equality and empowering women
• Reducing child mortality
• Improving maternal health
• Combating human immunodeficiency virus, acquired, immune
deficiency syndrome, malaria and other diseases
• Ensuring environmental sustainability

15. Activities to be undertaken under CSR (continued)
• Employment enhancing vocational skills, social business projects
• Contribution to the Prime Minister’s National Relief Fund or any other
fund set up by the Central Government or the State Governments for
socio-economic development, and
• Relief and funds for the welfare of the Scheduled Castes, the
Scheduled Tribes, other backward classes, minorities and women and
such other matters as may be prescribed.

16. THANK YOU