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TMI BlogVoluntary Liquidation of Corporate Persons [ Section 59 ]X X X X Extracts X X X X X X X X Extracts X X X X ..... , namely section 2(94A), which defines the expression "winding up" as "winding up under this Act or liquidation under the IBC." * It is also relevant that the enactment of the IBC triggered the removal of provisions of "voluntary winding up" and winding up on the grounds of "inability to pay debts" from the Companies Act, 2013. The proceedings relating to these are now under the ambit of the IBC. * Liquidation in cases of default in payment or repayment of any debt is not directly possible. For such entities, the emphasis is on resolution, and if the resolution process does not result in an approved resolution plan, a liquidation order is passed by the Adjudicating Authority under section 33 of the IBC. * As opposed to this, in a c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a corporate person under section 59(1) shall meet such conditions and procedural requirements as may be specified by the Board. * Conditions of initiation of voluntary liquidation proceedings [ Section 59(3) of the IBC, 2016 Read with Regulation 5 of IBBI (Voluntary Liquidation Process) Regulations, 2017 and Rule 8 of Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 ] * Without prejudice to section 59(2), voluntary liquidation proceedings of a corporate person registered as a company shall meet the following conditions, namely:- * (a) a declaration from majority of the directors of the company verified by an affidavit stating that- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value of the debt of the company shall approve the resolution passed under sub-clause (c) within seven days of such resolution. * Notification to Registrar of company and the Board [ Section 59(4) of the IBC, 2016 ] * The company shall notify the Registrar of Companies and the Board about the resolution under sub-section (3) to liquidate the company within seven days of such resolution or the subsequent approval by the creditors, as the case may be. * Commencement of liquidation proceeding [ Section 59(5) of the IBC, 2016 Read with Regulation 3 of IBBI (Voluntary Liquidation Process) Regulation, 2017] * Subject to approval of the creditors under sub-section (3), the voluntary liquidation proceedings in respect of a company shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f account (physical or electronic) referred to Regulation 8 and Regulation 10 of IBBI (Voluntary Liquidation Process) Regulations, 2017 shall be preserved for at least 8 years after dissolution either with himself or with an information utility. Forms Under Insolvency And Bankruptcy Board Of India (Voluntary Liquidation Process) Regulations 2017 * a) Public announcement [ Regulation 14 ] - Form A of Schedule I * b) Proof of claim by operational creditors except workmen and employees [ Regulation 16 ] - Form B of Schedule I * c) Proof of claim by financial creditors [ Regulation 17 ] - Form C of Schedule I * d) Proof of claim by workman or employee [ Regulation 18(1) ] - Form D of Schedule I * e) Proof of claim by authorised repre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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