VOLUNTARY WINDING UP IBC 2016 (w. e.

f 1st April 2017)

 Chapter V of Part II of the Insolvency and Bankruptcy Code, 2016 deals with voluntary
liquidation

 Any corporate person

 Section 59 of IBC, 2016

 A ‘corporate person’ as defined in Section 3 of Part I of the said Code means:

• A Company;

• A Limited Liability Partnership;

• Any other person incorporated with limited liability under any law.

 Exception:

• A corporate person does not include a financial service provider.

 PRE-REQUISITES

 The corporate person should not have committed any default (defined u/s 3(12))

 Declaration of solvency (along with affidavit)

• By whom

 Majority directors

• Contents

 They have formed an opinion that the company has no debts or if they exits
it will be able to pays the debts &

 The company is not being liquidated to defraud any person

• Documents to be accompanied

 Audited financial statements for the previous two years or for the period
since its incorporation, whichever is later and

 A valuation report of the assets of the company, if any prepared by the

registered valuer.

 Passing of Resolution

• Special Resolution / Resolution for

 Voluntary winding up

 Appointment of Liquidator (Insolvency Professional)

  Within FOUR weeks of giving the declaration

 Approval by creditors

• If company owns any debt to any person

• Resolution should be approved by creditors

 being 2/3rd in value

• Within SEVEN days of passing such resolution

 Notification to Authorities

• Notify the resolution

 ROC

 Insolvency and Bankruptcy Board

• To liquidate the company within SEVEN days

 The resolution OR

 Approval by the creditors

 Commencement of winding up

• From date of passing of resolution

• Dissolution of Company

• The affairs of the corporate person have been completely wound up

• Assets are completely liquidated

• Liquidator shall make an application to the Adjudicating Authority (NCLT) for

dissolution

 Dissolution Order

• NCLT shall pass an order that the company shall be dissolved.

• Dissolution effective from the date of that order.

 Copy of order to ROC

• The order of the NCLT shall be forwarded to the authority with which the corporate
person is registered within 14 days of date of such order.