VOLUNTARY WINDING UP OF A COMPANY BY THE MEMBERS (PROCEDURE)

STEP
NO.

PROCEDURAL
REQUIREMENTS

EXPLANATION OF THE PROCEDURAL REQUIREMENTS

(MAJOR HEADINGS)
1.

COMMENCEMENT OF
WINDING UP

[A]. Directors to convene a board meeting.

[B]. Make sure that the company can pay its debts in full within a period of
three years if put into liquidation.
[C]. Declaration of solvency in Form No. 149 under Rule 313 of the
Companies (Court) Rules, 1959 under Section 488 of the Companies Act, 1956
and verified by an affidavit (signed by two directors or majority of them), by
the Directors sworn before a Judicial Magistrate on non-judicial stamp paper
of Rs. 20/-.
[D]. The above-mentioned declaration will be accompanied by:
[D.1] The audited Balance Sheet and Profit & Loss Account commencing
from the date of last audited balance sheet and profit and loss account and
ending with the latest practicable date before the date of declaration.
[D.2] A statement of the companys assets and liabilities as at that date.
[D.3] A copy of the report of the auditors of the company on the above
two documents.
[E]. Approve at the meeting the draft resolution for Members Voluntary
Winding up and for appointing Liquidator and fix remuneration and also fix
the date, time, place of the general meeting.
[F]. The Form 149 and affidavit (mentioned above) should be duly notarized
and e-form 62 to be filed with Declaration of Solvency with ROC, the time
limit for such filing being 5 weeks before the date of passing of the Special
Resolution for winding up in a general meeting of members.
[G]. Issue notice for the general meeting proposing a Special Resolution, with
suitable Explanatory Statement.
[H]. Hold the General Meeting and pass the Special Resolution for winding up
and the appointment of liquidator(s). The winding up commences from the
time of passing the resolution.
[I]. Publish a Public notice regarding Voluntary Winding up (section 485 of the
Companies Act, 1956) and the appointment of liquidator (s) and fix their
remuneration.
[J]. Within 14 days of passing the resolution for voluntary winding up, give
notice of the resolution by advertisement in the Official Gazette and also in
some newspaper circulating both in English and in regional language, in the
district where the registered office of the company is situated.

[K]. Simultaneously, the Liquidator to publish in the Official Gazette, the

Notice of his appointment in Form No. 151 of Company Court Rules and file
with Registrar the Notice of his Appointment in form 152 of Company Court
Rules.
[L]. Simultaneously, Liquidator to give notice of his appointment to the
concerned Income-tax Officer under Section 178 of IT Act, 1961. No
prescribed format for this intimation. Letter would be sufficient.
[M]. Form 23 to be filed for Special resolution passed and Liquidator
appointment 30 days.
[N]. Form 62 [Others] category Intimation of Liquidator appointment
Section 493 of the Companies Act, 1956 - 10 days from appointment.
[O]. Form 62 Form 152 Intimation by Liquidator- 30 days from
appointment date.
[P]. In the above forms, Gazette notice copy, newspaper cuttings, EGM
notice, true copy of SR passed have to be attached.
[Q]. To obtain a Statement of Affairs of the Company in Form-57 duly verified
by Affidavit in form-58 from the Directors within 21 days of commencement
of winding up to the liquidator.
The Statement of Affairs primarily includes[Q.1] Details of Assets, liabilities and debts due to the company. A
liquidator to take steps determines the Creditors / liabilities of the company
and discharges the same out of the funds available with the company and to
call for a General Meeting. To do the process of collection from Assets and
payments to Creditors.
[Q.2] The liquidator is then required to do the following things namely
speedy realization of assets, preparation of list of creditors, admission of proof,
statement of list of contributories, making of such calls as are necessary,
payment to secured creditors of costs including the liquidators own
remuneration, payment of preferential claims and distribution of surplus after
meeting all the claims of creditors and after adjusting all rights and claims.
[Q.3] The Liquidator to intimate about the commencement of liquidation
process of the company to the Income Tax department under section 178 of the
Income Tax Act 1961.
[Q.4] The liquidator has to file various forms under The Companies
(Court) Rules, 1959 in connection with members voluntary winding up with
ROC in form 62 electronically. The details of the forms are given below which
are to be filed before Final meeting are:
(a). Form 149- Declaration of Solvency- Statement of Assets and Liabilities.
2.

AFTER THE
COMMENCEMENT OF

(b). Form 152- Notice of appointment of Liquidator.

WINDING UP

[A]. Liquidator to realize all assets and pay of all liabilities possible and
distribute the available surplus to all existing members proportionately.
[B]. Where the winding up process continues for more than a year, Liquidator
should call a general meeting within 3 month from the end of every year from
the date of commencement of winding up, and table before the meeting an
account of his acts and dealings along with statement in form No 153 of the
Companies (Court) Rules, which should be duly verified in Form 154 of the
Company Court Rules.
[C]. If the liquidator is of the opinion that the company will not be able to pay
its debts in full within the period stated in the declaration of solvency, or if the
period stated in the declaration of solvency has expired without the debts being
paid in full, the liquidator has to summon a meeting of the creditors, and table
before the meeting a statement of the assets and liabilities of the company in
Form No. 150 of the Companies (Court) Rules, 1959.
[D]. If [C] is applicable, then the Liquidator has to call a meeting of creditors
also within 3 months from the end of the year.
[E]. The Liquidator to file statements in the prescribed manner together with
the Audit Report in the prescribed format, with the concerned Registrar of
Companies twice in every year, if the liquidation is NOT completed within one
year from the commencement of the winding up.
[F]. Complete the winding up by realising all assets and paying off all
liabilities and returning share capital and surplus, if any. The provisions of
sections 426, to 432, 487, 491, 494, 511, 511A, 512, 517 to 520, 528 to 549
and 553 and those of rules from Nos. 124 to 134 and Nos: 312 to 361 of the
Companies (Court) Rules 1959 should also be noted in this respect.
[G]. As soon as the affairs of the company are fully wound-up, liquidator to
prepare his account of the winding up in Form No. 156 of the Companies
(Court) Rules 1959 and get the same audited. The audit report should be in the
format suggested by ICAI for this purpose.

3.

FINAL MEETING

[A]. Liquidator to call the final General Meeting by giving notice stating the
time, place and object of the meeting, in Form No. 155 of the Companies
(Court) Rules, 1959 by advertisement in the official Gazette. The Notice in the
Gazette to be given not less than one month before the meeting. In addition,
the notice should also be published in some newspaper circulating in the
district where the registered office of the company is situated.
[B]. At the meeting, place the accounts prepared.
[C]. At the meeting also pass a special resolution for disposal of the books and
papers of the company when the affairs of the company are completely wound
up and it is about to be dissolved.
[D]. Within a week of the final meeting, file the copy of the account with the
ROC as well as with the Official Liquidator (OL) and also file a return with

both in Form No. 157 of the Companies (Court) Rules 1959. If a quorum is not
present at the meeting, file the return in form no. 158 of the Companies (Court)
Rules, 1959.
[E]. File the Special Resolution with the ROC, within 30 days of passing in
Form No. 23 after paying the requisite fee.
4.

AFTER FINAL MEETING

[A]. Form 62 Form 156

[B]. Form 62 Form 157 Return of Winding up.
[C]. Form 23 Resolutions passed at the Final meeting along with Minutes of
meeting.
[D]. In the above forms, Gazette notice copy, newspaper cuttings, have to be
attached.
[E]. The Registrar of Companies, on receiving the account and the return shall
forthwith register them.
[F]. Liquidator has a duty in accordance with Section 496 of the act to call a
General Meeting at the end of each year.
[G]. To submit documents, books and accounts to official liquidator for
verification.
[H]. Official Liquidator has to verify the statements and submit his report to
the court.
[I]. The High Court will issue the order for liquidation of the company.
[J]. To file copy of order of High Court in Form -21 with ROC Within 30 days
from the receipt of order from the High Court and with this the liquidation
process is over.
[K]. To check the status of the company in MCA to find out and confirm the
status of the company is changed to liquidated.