Section 272 of Companies Act, 2013 – Petition for winding up

SECTION 272. PETITION FOR WINDING UP

[Effective from 15th December, 2016]

[1] [(1)Subject to the provisions of this section, a petition to the Tribunal for the winding up of a company shall be presented by—

(a)   the company;

(b)   any contributory or contributories;

(c)   all or any of the persons specified in clauses (a) and (b);

(d)   the Registrar;

(e)   any person authorised by the Central Government in that behalf; or

(f)   in a case falling under clause (b) of section 271, by the Central Government or a State Government.

(2) A contributory shall be entitled to present a petition for the winding up of a company, notwithstanding that he may be the holder of fully paid-up shares, or that the company may have no assets at all or may have no surplus assets left for distribution among the shareholders after the satisfaction of its liabilities, and shares in respect of which he is a contributory or some of them were either originally allotted to him or have been held by him, and registered in his name, for at least six months during the eighteen months immediately before the commencement of the winding up or have devolved on him through the death of a former holder.

(3) The Registrar shall be entitled to present a petition for winding up under section 271, except on the grounds specified in clause (a) [3] [ of that section] :

Provided that the Registrar shall obtain the previous sanction of the [2] [Central Government] to the presentation of a petition:

Provided further that the [2] [Central Government] shall not accord its sanction unless the company has been given a reasonable opportunity of making representations.

(4) A petition presented by the company for winding up before the Tribunal shall be admitted only if accompanied by a statement of affairs in such form and in such manner as may be prescribed.

(5) A copy of the petition made under this section shall also be filed with the Registrar and the Registrar shall, without prejudice to any other provisions, submit his views to the Tribunal within sixty days of receipt of such petition.]

Applicable Rules

Companies (Winding Up) Rules, 2020

[Effective from 1st April, 2020]

PART II

WINDING UP BY TRIBUNAL

Rule 3. Petition for winding up.—(1) For the purposes of sub-section (1) of section 272, a petition for winding up of a company shall be presented in Form WIN 1 or Form WIN 2, as the case may be, with such variations as the circumstances may require, and shall be presented in triplicate.

(2) Every petition shall be verified by an affidavit made by the petitioner or by the petitioners, where there are more than one petitioners, and in case the petition is presented by a body corporate, by the Director, Secretary or any other authorised person thereof, and such affidavit shall be in Form WIN 3.

Rule 4. Statement of affairs

Rule 4. Statement of affairs.—The statement of affairs, as required to be filed under sub-section (4) of section 272 or sub-section (1) of section 274, shall be in Form WIN 4 and shall contain information up to the date which shall not be more than thirty days prior to the date of filling the petition or filling the objection as applicable and the statement of affairs shall be made in duplicate, duly verified by an affidavit, and affidavit of concurrence of the statement of affairs shall be in Form WIN 5.

Rule 5. Admission of petition and directions as to advertisement

Rule 5. Admission of petition and directions as to advertisement.—Upon filing of the petition, it shall be posted before the Tribunal for admission of the petition and fixing a date for the hearing thereof and for appropriate directions as to the advertisements to be published and the persons, if any, upon whom copies of the petition are to be served, and where the petition has been filed by a person other than the company, the Tribunal may, if it thinks fit, direct notice to be given to the company and give an opportunity of being heard, before giving directions as to the advertisement of the petition, if any, and the petitioner shall bear all costs of the advertisement.

Rule 6. Copy of petition to be furnished

Rule 6. Copy of petition to be furnished.—Every contributory of the company shall be entitled to be furnished by the petitioner or by his authorised representative with a copy of the petition within twenty four hours of his requiring the same on payment of five rupees per page.

Rule 7. Advertisement of petition

Rule 7. Advertisement of petition.—Subject to any directions of the Tribunal, notice of the petition shall be advertised not less than fourteen days before the date fixed for hearing in any daily newspaper in English and vernacular language widely circulated in the State or Union territory in which the registered office of the company is situated, and the advertisement shall be in Form WIN 6.

Rule 8. Application for leave to withdraw petition

Rule 8. Application for leave to withdraw petition.—(1) A petition for winding up shall not be withdrawn after presentation without the leave of the Tribunal subject to compliance with any order of the Tribunal, including as to costs.

(2) An application for leave to withdraw a petition for winding up which has been advertised in accordance with the provisions of rule 7 shall not be heard at any time before the date fixed in the advertisement for the hearing of the petition.

Rule 9. Substitution for original petitioner

Rule 9. Substitution for original petitioner.—(a) Where a petitioner—

(i)   is not entitled to present a petition; or

(ii)   fails to advertise his petition within the time prescribed by these rules or by order of Tribunal; or

(iii)   consents to withdraw the petition, or to allow it to be dismissed, or fails to appear in support of his petition when it is called on in Tribunal on the day originally fixed for the hearing thereof, or any day to which the hearing has been adjourned; or

(iv)   if appearing, does not apply for an order in terms of the prayer of his petition; or,

(b) where in the opinion of the Tribunal there is other sufficient cause for an order being made under this rule, the Tribunal may, upon such terms as it may think just, substitute as petitioner any other person who, in the opinion of the Tribunal, would have a right to present a petition, and who is desirous of prosecuting the petition.

Rule 10. Procedure on substitution

Rule 10. Procedure on substitution.—Where the Tribunal makes an order substituting a contributory as petitioner in a winding up petition, it shall adjourn the hearing of the petition to a date to be fixed by the Bench and direct such amendments of the petition as may be necessary and such contributory shall, within seven days from the making of the order, amend the petition accordingly, and file two legible and clean copies thereof together with an affidavit in duplicate setting out the grounds, on which he supports the petition and the amended petition shall be treated as the petition for the winding up of the company and shall be deemed to have been presented on the date on which the original petition was presented.

Rule 11. Affidavit-in-objection

Rule 11. Affidavit-in-objection.—Any affidavit in objection to the petition under sub-section (1) of section 272 shall be filed within thirty days from the date of order, and a copy of the affidavit shall be served on the petitioner or his authorised representative forthwith and copies of the affidavit shall also be given to any contributory appearing in support of the petition who may require the same on payment of five rupees per page within three working days.

Rule 12. Affidavit in reply

Rule 12. Affidavit in reply.—An affidavit in reply to the affidavit in objection to the petition shall be filed not less than seven days before the day fixed for the hearing of the petition, and a copy of the affidavit in reply shall be served on the day of the filing thereof on the person by whom the affidavit in objection was filed or his authorised representative.

 

[1] Substituted by the Insolvency and Bankruptcy Code 2016, (13 of 2016) s. 255 & eleventh schedule for the words “(1) Subject to the provisions of this section, a petition to the Tribunal for the winding up of a company shall be presented by—

(a)   the company;

(b)   any creditor or creditors, including any contingent or prospective creditor or creditors;

(c)   any contributory or contributories;

(d)   all or any of the persons specified in clauses (a), (b) and (c) together;

(e)   the Registrar;

(f)   any person authorised by the Central Government in that behalf; or

(g)   in a case falling under clause (c) of sub-section (1) of section 271, by the Central Government or a state Government.

(2) A secured creditor, the holder of any debentures, whether or not any trustee or trustees have been appointed in respect of such and other like debentures, and the trustee for the holders of debentures shall be deemed to be creditors within the meaning of clause (b) of sub-section (1).

(3) A contributory shall be entitled to present a petition for the winding up of a company, notwithstanding that he may be the holder of fully paid-up shares, or that the company may have no assets at all or may have no surplus assets left for distribution among the shareholders after the satisfaction of its liabilities, and shares in respect of which he is a contributory or some of them were either originally allotted to him or have been held by him, and registered in his name, for at least six months during the eighteen months immediately before the commencement of the winding up or have devolved on him through the death of a former holder.

(4) The Registrar shall be entitled to present a petition for winding up under sub-section (1) on any of the grounds specified in sub-section (1) of section 271, except on the grounds specified in clause (b), clause (d) or clause (g) of that sub-section:

Provided that the Registrar shall not present a petition on the ground that the company is unable to pay its debts unless it appears to him either from the financial condition of the company as disclosed in its balance sheet or from the report of an inspector appointed under section 210 that the company is unable to pay its debts:

Provided further that the Registrar shall obtain the previous sanction of the Central Government to the presentation of a petition:

Provided also that the Central Government shall not accord its sanction unless the company has been given a reasonable opportunity of making representations.

(5) A petition presented by the company for winding up before the Tribunal shall be admitted only if accompanied by a statement of affairs in such form and in such manner as may be prescribed.

(6) Before a petition for winding up of a company presented by a contingent or prospective creditor is admitted, the leave of the Tribunal shall be obtained for the admission of the petition and such leave shall not be granted, unless in the opinion of the Tribunal there is a prima facie case for the winding up of the company and until such security for costs has been given as the Tribunal thinks reasonable.

(7) A copy of the petition made under this section shall also be filed with the Registrar and the Registrar shall, without prejudice to any other provisions, submit his views to the Tribunal within sixty days of receipt of such petition.”

[2]  Powers of Central Government delegated to Regional Director vide Notification No. No. S.O. 4090(E) dated 19th December, 2016.

[3] Substituted for the words “or clause (e) of that sub-section” by the Companies (Amendment) Act, 2019 vide notification No. File No. 1/5/2019-CL-I dated 14th August, 2019