Section 290 of CA 2013 : Section 290: Powers And Duties Of Company Liquidator

Explanation using Example

Imagine a scenario where XYZ Pvt. Ltd. is undergoing a compulsory winding up process by a tribunal due to insolvency. The appointed Company Liquidator, Mrs. Smith, is tasked with managing the affairs of XYZ Pvt. Ltd. to ensure its assets are appropriately handled and liabilities settled.

Here's how Mrs. Smith might apply Section 290 of The Companies Act, 2013 in her duties:

• Mrs. Smith continues to operate certain divisions of XYZ Pvt. Ltd. that are profitable to maximize the returns from selling the business. This is in line with Section 290(1)(a).
• She executes a property sale deed on behalf of XYZ Pvt. Ltd. using the company's seal to sell an office building, as per Section 290(1)(b).
• She organizes a public auction to sell the company's fleet of vehicles, which falls under Section 290(1)(c).
• Mrs. Smith finds a buyer interested in purchasing the entire manufacturing unit of XYZ Pvt. Ltd. as a going concern, which she handles in accordance with Section 290(1)(d).
• To pay off urgent debts, she takes out a short-term loan using the company's remaining inventory as collateral, in line with Section 290(1)(e).
• She represents XYZ Pvt. Ltd. in a lawsuit filed by a supplier for non-payment of dues, as empowered by Section 290(1)(f).
• Mrs. Smith invites claims from creditors and employees, verifies their authenticity, and prepares to distribute the proceeds from asset sales, as specified in Section 290(1)(g).
• She examines the financial records of XYZ Pvt. Ltd. held by the Registrar of Companies to ensure all assets are accounted for, as per Section 290(1)(h).
• When a contributory to the company declares bankruptcy, Mrs. Smith files a claim to recover any outstanding amounts for XYZ Pvt. Ltd., as mentioned in Section 290(1)(i).
• She also endorses cheques for the settlement of certain transactions that are part of the winding-up process, as allowed by Section 290(1)(j).
• Mrs. Smith hires a legal expert to assist with the complex legal matters arising during the winding-up process, as per Section 290(1)(l).
• Finally, she prepares and files the necessary documents with the tribunal to officially dissolve XYZ Pvt. Ltd., following Section 290(1)(m) and Section 290(1)(n).

All of Mrs. Smith's actions are subject to the oversight of the tribunal, ensuring she adheres to the legal framework provided by Section 290(2) and (3) of The Companies Act, 2013.