top of page

Kinds, Consequences And Reasons For Winding Up Of A Company Under Companies Act, 2013

Rajat Rana, Shivam Sureka & Bhavya Aggarwal, B.COM.LL.B (H), Amity Law School, Noida


This research paper is on Indian firm winding up laws. Winding up is defined as winding up under this act1 or liquidation of a firm under the IBC Code, 20162 i.e. a procedure through which a company's legal position is terminated. This paper discusses the legislation relating to the Companies Act and the many repercussions and grounds for a firm’s winding up. A firm’sdissolution might be required for a variety of reasons, including the end of a business, misfortune, insolvency, the endless succession of promoters, and so on. A firm’s winding up procedure can be launched purposefully by the various Tribunal or creditors, or by stakeholders. Liquidation is another term for winding up. Because it is the NCLT that deals with company cases in India, the tribunal's powers and jurisdiction are extremely important. The corporation is only wound up after a tribunal order. There are 2 types of winding up, as per Section 4253. They are as follows: Compulsory Winding Up on the Court's Order: A firm may be forced to wind up on the Court's order. Compulsory Winding Up is another name for this. Section 4334 lists the circumstances in which a corporation may be wound up, and the second is Voluntary Winding Up, which has two types: Creditors and Members Voluntary Winding Up. It will be Members Voluntary Winding Up if a Solvency Declaration is made in compliance with the Act's provisions; if it is not made, it will be a Creditors' Voluntary WindingUp. The declaration must be made by a majority of the directors at the board meeting and mustbe backed up by an affidavit. There may be general and legal consequences and consequences with regard to the company itself, shareholders, creditors, management, and the disposition of the business's property following the winding up of the firm.


Indian Journal of Law and Legal Research

Abbreviation: IJLLR

ISSN: 2582-8878


Accessibility: Open Access

License: Creative Commons 4.0

Submit Manuscript: Click here

Open Access Logo


​All research articles published in The Indian Journal of Law and Legal Research are fully open access. i.e. immediately freely available to read, download and share. Articles are published under the terms of a Creative Commons license which permits use, distribution and reproduction in any medium, provided the original work is properly cited.


The opinions expressed in this publication are those of the authors. They do not purport to reflect the opinions or views of the IJLLR or its members. The designations employed in this publication and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the IJLLR.

bottom of page