RECENT TRENDS IN WINDING UP OF COMPANIES IN INDIA

Abstract

As per the Companies Act, 2013, a Company is an artificial juristic person which can only come into existence through registration and incorporation and is provided with various rights, duties and obligations .Similarly dissolution of company is a legal phenomenon, as per the guidelines of the article of association, being regulated by the various provisions of the said Act. Winding up means a process 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 to the members in proportion to their contribution to the capital of the company. As per Section 2 (94A) of the Companies Act, 2013, winding up refers to process winding up under the said Act or liquidation under the Insolvency and Bankruptcy Code, 2016. There exit various modes of winding up of Companies under section 270 of Companies Act, 2013, such as Compulsory winding up by the courts, Winding up under the supervision of court and Voluntary winding up. After the enforcement of the Insolvency and Bankruptcy Code, 2016, several changes have been brought in the Companies Act, 2013, such as subtractions voluntary winding up and winding up on the ground of inability to pay debts. The research paper is an attempt to examine the important principals governing winding up of companies in India and has been written in an analytical style. The study is essentially being doctrinal and secondary source of data has been used for writing the research paper. The primary sources include Companies Act, 1956, Companies Act, 2013, Insolvency and Bankruptcy Code, 2016 and the government notifications of various amendments done in the existing laws. The research paper will analyse the recent trends in the winding up of companies in India and its impact followed by suggestions wherever required.