Module – IX Company Meetings & Company Secretary

1. Module – IX Company Meetings & Company Secretary Course Leader: Dr. K. Srinivasan Department of Management Studies Christ University, Bangalore.

2. Winding Up • Winding Up of a company is the process whereby its life is ended and its property administered for the benefit of its creditors and members. • An administrator, called 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 • Professor. Gower

3. Modes of Winding Up • Winding up by the Court (Compulsory Winding Up) • Voluntary Winding Up • Member’s Voluntary Winding Up • Creditor’s Voluntary Winding Up • Winding Up subject to the supervision of the Court.

4. Winding Up by the Court • Special Resolution of the Company • Default in holding statutory meeting • Failure to commence business • Reduction in Membership • Inability to pay its debts • Demand for payment neglected • Decreed debt unsatisfied • Commercial Insolvency • Just and Equitable • Substratum of the Company is gone • Majority of the shareholders using the powers unfairly • Deadlock in the management to achieve the objectives

5. Petition for Winding Up • By the Company • By the Creditors • Debentures Holders • Central or state Government whom any tax charge is due. • Person who has monetary claim against the company • By any Contributory or Contributors • Membership is reduced below the statutory minimum • Original Allottee of shares • Held the company shares for at least 6 months during the 18 months immediately before the commencement of winding up. • Shares have transferred through the death of a former holder. • By the Registrar • By any person authorized by the Central Government

6. Content of the Petition • Name of the Company with the date of its Incorporation • Address of the Registered Office • Amount of Paid – Up Capital • Statement of facts to justify a winding Up order. • Request to the Court to issue an order of winding up • Statement in the form of an affidavit that the facts stated in the petition are correct and true.

7. Procedures for Winding Up • Commencement of Winding Up • Advertisement of Petition • Power of Court to stay or restrain proceedings against company • Intimation to Liquidator or Registrar • Copy of Winding up order to be filled with the Registrar

8. Consequences of Winding Up • Order for winding up deemed to be notice of discharge • Suits Stayed • Powers of the Court • Effect of Winding Up • Official Liquidator to be liquidator

9. Liquidator Liquidator is a person who helps the court to complete the liquidation proceedings. An official liquidator may be appointed from a panel of professional firms of CA, Advocates, Company Secretaries etc., which the Central Government shall constitute for the court; or may be a body corporate consisting of such professionals as may be approved by the central government from time to time; or may be a whole time or part time officer appointed by the central government.

10. Duties of Liquidator • Proceedings in Winding Up • Report • Custody of Company’s Property • Control of Powers • Meetings of Creditors and Contributors • Directions from the Court • Proper Books • Audit of Accounts • Appointment of Committee of Inspection • Pending Liquidation

11. Powers of Official Liquidator • To defend any suit, civil or criminal proceedings in the name and on behalf of the company. • To carry on the business of the company so far as may be necessary for the beneficial winding up of the company. • To sell movable or immovable property of the company – wholly or in parcels either privately or through public action. • To raise money on the security of the assets of the company. • To do all things as may be necessary for the winding up of the affairs of the company and distributing its assets.

12. Other Powers…. • Execute all deeds, Receipts and other documents in the name and on behalf of the company under company’s seal. • Prove, rank and claim the insolvency of a contributory. • Draw, accept, make and endorse any bill of exchange or promissory note in the name and on behalf of the company. • Appoint an agent to do any business which the liquidator is unable to do himself, etc. • Appoint Security guards, Valuer, CA etc. • Publish an advertisement inviting bids for sale of the assets of the company etc.

13. General Powers of the Court • Stay of Winding Up of the Company • Settlement of list of contributories • Delivery of Property • Summoning of Persons suspected of having property of the company • Exclusion of Creditors • Order as to Costs • Arrest of Absconding Contributory • Meetings of Creditors or contributories

14. Voluntarily Winding Up • Voluntarily winding up means winding up by the members or creditors of a company without interferences by the Court. • The main objectives of this winding up is to settle their affairs without going to the Court of Law. • The company may wound up voluntarily on two ways; • By Passing an Ordinary Resolution • By Passing an Special Resolution

15. Provisions Applicable for MVWU • Appointment of Liquidators • Board’s powers to cease on appointment of a liquidator • Powers to fill vacancy in office of liquidator • Notice of appointment of liquidator to be given to Registrar • Power of Liquidator to accept shares etc. • Duty of liquidator to call creditors meeting in case of insolvency • Duty to call General Meeting at the end of the year • Final Meeting and Dissolution – Penalty Rs. 1,000 • Provisions as to Annual & Final Meeting in case of Insolvency.

16. Duties of Secretary in MVWU • Arrange the Board Meeting, within 5 weeks immediately preceding the date of passing the resolution for MVWU. • Arranging & Preparing P&L Account, B/S & Audited Report and ending with the latest practicable date before the date of declaration • Prepare declaration of Solvency, get it verified by affidavit before the Magistrate & file with the Registrar with all reports. • Prepare & Issue of notice of the meeting to members & to check special resolution passed, appointment & remuneration fixed in the meeting. • Check the Official Gazette and newspapers within 14 days after passing resolution

17. Continued….. • Notice of appointment of liquidator is filed with registrar with 10 days of passing resolution. • Check the special resolution for winding up is filed with the Registrar within 30 days of the meeting. • Check every invoice, order and business letter issued by the company during the period contains a statement that company is being wound up • Check all the Books, Documents, Movables & Immovable properties of the company are delivered to the liquidator, for public examination and give evidence as required.

18. Creditors Voluntarily Winding Up (CVWU) • Meeting of Creditors –2 Newspapers • Resolution Notice given to Registrar – 10 Days & Rs. 500 • Appointment of Liquidator • Committee Appointment Inspection – Not more than 5 Persons • Liquidator Remuneration • Board’s Powers to cease an appointment of Liquidator • Powers to fill vacancy in office of liquidator • Duty of Liquidator to call meeting of company & Creditors at the end of each year • Final Meeting & Dissolution

19. WU- Subject to Supervision of Court • WU of a company subject to the supervision of the court presupposes a voluntary winding up of the Company • At any time after a company passed a winding up, the Court may make an order that voluntary winding up shall continue, but subject to the supervision of the Court. • The court may give such liberty to creditors, contributors or others to apply to as it thinks. • Petition for the continuance of a voluntary winding up subject to the supervision of the Court is deemed to be a petition for winding up by the Court.

20. Consequences of Winding Up • Consequence as to shareholders • Consequence as to Creditors • Consequence as to Servants & Officers • Consequence as to Proceedings against the Company • Consequence as to Costs

21. All the Best for Ur End Semester