Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Save to My Library
Look up keyword
Like this
1Activity
0 of .
Results for:
No results containing your search query
P. 1
Winding Up - Complete

Winding Up - Complete

Ratings: (0)|Views: 59 |Likes:
Published by rhnthr
corporate law notes by pro. Ale Imran notes for ICMAP students.

CLSP
corporate law notes by pro. Ale Imran notes for ICMAP students.

CLSP

More info:

Published by: rhnthr on Sep 05, 2009
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as DOC, PDF, TXT or read online from Scribd
See more
See less

09/05/2009

pdf

text

original

 
WINDING UP
PART XI. – WINDING UPPRELIMINARY297.Modes of winding up.
(1)The winding up of a company may be either-(i)by the Court; o(ii)voluntary; o(iii)subject to the supervision of the Court.(2)Save as otherwise expressly provided, the provisions of this Ordinance with respect towinding up shall apply to the winding up of a company in any of the modes specified insub-section (1).
 A company may be wound up through following modes:-
(1)Compulsory winding up by the Court.(2)Voluntary winding up:-a.By Members,b.By Creditors.(3)Voluntary winding up under the supervision of the Court.
Contributories
298.Liability as contributories of present and past members. – 
(1)In the event of a company being wound up, every present and past member shall, subjectto the provisions of section 299, be liable to contribute to the assets of the company to anamount sufficient for payment of its debts and liabilities and the costs, charges andexpenses of the winding up, and for the adjustment of the rights of the contributoriesamong themselves, with the qualifications following, that is to say, -(i)a past member shall not be liable to contribute if he has ceased to be member foone year or upwards before the commencement of the winding up;(ii)a past member shall not be liable to contribute in respect of any debt or liabilityof the company contracted after he ceased to be a member;(iii)a past member shall not be liable to contribute unless it appears to the Court thatthe present members are unable to satisfy the contributions required to be made by them in pursuance of this Ordinance;(iv)in the case of a company limited by shares, no contribution shall be requiredfrom any past or present member exceeding the amount, if any, unpaid on theshares in respect of which he is liable as such member;(v)in the case of a company limited by guarantee, no contribution shall, subject tothe provisions of sub-section (2), be required from any past or present member exceeding the amount undertaken to be contributed by him to the assets of thecompany in the event of its being wound up;(vi)nothing in this Ordinance shall invalidate any provision contained in any policyof insurance or other contract whereby the liability of individual members on the policy or contract is restricted, or whereby the funds of the company are alonemade liable in respect of the policy or contract; and(vii)a sum due to any past or present member of a company in his character as such, by way of dividends, profits or otherwise, shall not be deemed to be a debt of thecompany payable to that member in a case of competition between himself andany other creditor not being a member of the company, but any such sum may be
Page 1 of 98
 
WINDING UP
taken in to account for the purpose of the final adjustments of the rights of thecontributories among themselves.(2)In the winding up of a company limited by guarantee which has a share capital, everymember of the company shall be liable, in addition to the amount undertaken to be contributed byhim to the assets of the company in the event of its being wound up, to contribute to the extent of any sum unpaid on any shares held by him, as if the company were a company limited by shares.
Pasf Member:
 A shareholder is liable even after transfer, forfeiture or surrender of the shares, if the liquidation takes place within one year of such transfer, etc. and if he is on the list of contributories. [ AIR 1924 Mad 703 ] But the liability to contribute does not arise until all theexisting members have been called upon to do so. [AIR 1936 Lah 739 DB]
Parameters as to contribution:
Buckley's Companies Act (l2
h
Ed Page 435) providesfollowing parameters as to contribution:-TheA contributors (i.e. those in the list of present members) are primarily liable for everything, and must be first individually exhausted before any B contributory can becalled upon.Theassets of the company, including the A contributions, are first (subject to the question of costs) to be applied to payment pari passu of all the debts of the company irrespective of the time at which such debts were contracted.Theliability of a B contributory, i.e. past member is limited by.-a.the amount left unpaid on his shares by the corresponding a contributory, b.Such residium of the debts contracted before he ceased to be a member as remainsundischarged.Thecontributions of B contributories form part of the general assets of the company fo payment of all the debts of the company irrespective of the time at which such debts werecontracted.If,before a call is made upon the B list, or before payment of such call, the debts in respectof which a B contributory was, having regard to sub-section 1(b), liable to contribute, or any of them are in any manner released or extinguished in whole or in part, his liability tocontribute to the assets of the company is subject to any question as to the costs of thewinding upon thereby pro tanto discharged.Theliability of a B contributory to contribute to the costs of winding up is confined to suchcosts as have been occasioned by the necessity of calling upon him for contributions inrespect of debts.Bcontributories of later date are not to be exhausted before calling on B contributories oearlier date. All past members as among themselves are simultaneously liable tocontribute.
299.Liability of directors whose liability is unlimited. -
In the winding up of a limitedcompany any director, whether past or present, whose liability is, in pursuance of thisOrdinance, unlimited, shall, in addition to his ability, if any, to contribute as an ordinarymember, be liable to make a further contribution as if he were, at the commencement of the winding up, a member of an unlimited company: Provided that-
Page 2 of 98
 
WINDING UP
(i)a past director shall not be liable to make such further contribution if he hasceased to hold office for a year or upwards before the commencement of thewinding up;(ii)A past director shall not be liable to make such further contribution in respect oany debtor liability of the company contracted after he ceased to hold office;(iii)subject to the articles, a director shall not be liable to make such furthecontribution unless the Court deems it necessary to require that contribution inorder to satisfy the debts and liabilities of the company, and the costs, chargesand expenses of the winding up.
300.Definition of "contributory".
- The term "contributory" means every person liable tocontribute to the assets of a company in the event of its being wound up, and include theholder of any shares which are fully paid up; and, in all proceedings for determining, andall proceedings prior to the final determination of, the persons who are to be deemedcontributories, includes any person alleged to be a contributory.
301.Nature of liability of contributory.
 – (1)The liability of a contributory shall create a debt accruing due from him at the time whenhis liability commenced, but payable at the time specified in calls made on him for enforcing the liability.(2)No claim founded on the liability of a contributory shall be cognizable by any Court of Small Causes.
302.Contributories in case of death of member.
 – (1)If a contributory dies either before or after he has been placed on the list ocontributories, his legal representatives shall be liable, in a due course of administration,to contribute to the assets of the company in discharge of his liability, and shall becontributories accordingly.(2)If the legal representatives make default in paying any money ordered to be paid by them, proceedings may be taken for administering the property of the deceased contributory,and of compelling payment thereout of the money due.
303.Contributory in case of insolvency of member.
- If a contributory is adjudged insolventeither before or after he has been placed on the list of contributories, then-(a)his assignees in insolvency shall represent him for all the purposes of the windingup, and shall be contributories accordingly, and may be called on to admit to proof against the estate of the insolvent, or otherwise to allow to be paid out of his assets in due course of law, any money due from the insolvent in respect of his liability to contribute to the assets of the company; and(b)there may be proved against the estate of the insolvent the estimated value of hisliability to further calls as well as calls already made.
304.Contributories in case of winding up of a body corporate which is a member.
- If a body corporate which is a contributory is ordered to be wound up, either before or after ithas been placed on the list of contributories,-(a)the liquidator of the body corporate shall represent it for all purposes of thewinding up of the company and shall be a contributory accordingly, and may becalled on to admit to proof against the assets of the body corporate, or otherwise
Page 3 of 98

You're Reading a Free Preview

Download
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->