Winding up
sheela
(Querist) 04 June 2015
This query is : Resolved
A registered company dealing with investment from public closed abruptly in 2010. A creditor of that company wants to file a petition for winding up of the company before Delhi HC. Can he do it. What is limitation period in such cases.
SAINATH DEVALLA
(Expert) 04 June 2015
The creditor can file a petition in the HC for winding up of the bankrupt company u/s 272 of the company's act 2013.
Anirudh
(Expert) 04 June 2015
If the Company had closed in 2010, means that the creditor might have given amount at least in 2010.
By now i.e. in 2015, the limitation for recovery is completely barred.
Therefore the question of filing any winding up petition on this score simply does not arise.
SAINATH DEVALLA
(Expert) 04 June 2015
What do U mean by the word company is closed?If it is company registered under companies act 1956,the winding up of the company has to be intimated to the Registrar of Companies.Unless and until it is done it is deemed that the company still exists sans operations.
Hence every creditor has a right to approach the HC for winding up.If the company is not represented in the HC by anyone,then it will be decided expartee and sent to the Official Liquidator for conducting enquiry to siege the assets and books of accounts of the company.
This is the procedure.
Anirudh
(Expert) 04 June 2015
I was only using the term "closed"as used by the querist (though I know that there ought to be proper winding up).
But the point is, if according to the querist it was not in operation from 2010, that means the credit ought to have been given by that time. Therefore by now the claim for recovery of the amount given is hopelessly time-barred. IN SUCH A SITUATION THE QUERIST CANNOT APPROACH ANY LEGAL FORUM, MUCH LESS FOR WINDING -UP.
Without crossing this hurdle, to think of official liquidator etc., is pointless.
sheela
(Querist) 04 June 2015
I take it you gentle persons are agreed that the case is hit by limitation and cannot be pursued at any forum. I am indebted to the experts who responded to my query.
R.K Nanda
(Expert) 05 June 2015
limitation period is 3 years.
SAINATH DEVALLA
(Expert) 05 June 2015
A company registered under the companies act 1956,cannot shut the door and leave.If it does so,it gives a chance for the creditors to file a winding up petition in the HC so as to at least get their dues by way of auction of the company's assets.
Kumar Doab
(Expert) 05 June 2015
Show all communications exchanged by the company by the creditor etc to an able lawyer and let your counsel finally opine on it.
There might be good scope.
Closed abruptly implies without any notice to investors/clients/shareholders!
sheela
(Querist) 05 June 2015
The company was running ponzi schemes as the creditors realised to their horror when one day they found it shut. Owners and others were later on arrested by Delhi police and a criminal case is going on against them in a district court. Are not these circumstances exceptional enough to justify condonation of delay. Shall be grateful for experts' advice.
SAINATH DEVALLA
(Expert) 06 June 2015
Sheela,
Instead of keeping on adding,why don't U put UR entire query in the initial post. Keeping on adding new substance U will not get the correct assistance.Earlier U didn't mention about the criminal case against the directors and their arrest thereon.
Anirudh
(Expert) 06 June 2015
Dear Mr. Sainath Devalla,
Nobody can disagree with your statement that A company registered under the companies act 1956,cannot shut the door and leave.If it does so,it gives a chance for the creditors to file a winding up petition in the HC so as to at least get their dues by way of auction of the company's assets.""
That is not the issue involved in he present query. The first question to be answered is whether when the credit was given somewhere in the year 2010, whether after nearly 4 1/2 years, one will be in a position to file a petition for winding up. Whether limitation will not stare at such a person?
Instead of answering this straight practical aspect, you are unnecessarily harping on theoretical aspect.
SAINATH DEVALLA
(Expert) 06 June 2015
Gentleman,
Unless and until the company (Registered) has been winded up officially,all the liabilities stand to exist.There is no time frame for it,until some creditor approaches the HC for official winding up of the company or the winding up has been intimated to the Registrar of Companies by the Directors.
Anirudh
(Expert) 06 June 2015
Dear Mr. Sainath Devalla,
Please be straight.
Assume that I gave some deposit to a Company in the year 2010.
Can I now file a petition for winding up in the year 2015? Whether my petition will get hit by limitation or not?
SAINATH DEVALLA
(Expert) 06 June 2015
Depositors cannot approach the HC for winding up,only the creditors who have previously done transactions with the company can do so.
Anirudh
(Expert) 06 June 2015
What is the legal basis for you say that Creditors can apply, even though it is more than 3 years now?
malipeddi jaggarao
(Expert) 07 June 2015
The investor is a creditor. The Company acknowledges this debt in their audited annual balance sheets. This is a proof of acknowledgement. It saves the limitation. Hence the investors can go to Court for Winding up proceedings. This is my view.
sheela
(Querist) 07 June 2015
I am indeed grateful to you all experts to have shown such great interest. Preponderance of the views I presume is that a petition in Form 46 under rule 95 of the Company (Court) Rules can be made to the Delhi HC without worrying about limitation.
Kumar Doab
(Expert) 07 June 2015
You can very well rely on the wisdom of courts when the general public is defrauded by such fraudsters like this one running Ponzi schemes.
The courts of law in Republic of India are not dealing with these Ponzi schemes Wallas for the first time.
It is not clear whether the company is unable to pay the debt or not.
There are situation where the creditor cannot sue a company in civil proceedings as time barred debt but can by invoking the exclusion under Section 15(2) of the Limitation Act, sue a company for winding up of company on account of deeming fiction that the company is unable to pay the same debt.
A criminal case is going on.
Agreed with Mr.Devalla and Mr.Jaggarao.
The amount deposited is recoverable debt.
The lawyers/law firm that specialize in such cases can deliberate more.
Views of Expert Mr. A.V.Vishal,Mr.Zulfiqar Ali Khan are also requested.
Biswanath Roy
(Expert) 08 June 2015
If in a given case, a certain sum of money was due to the company for the money lent, Article 19 of the Limitation Act, provides for three years from the date when the loan is made. If, in such a case,more than three years had elapsed on the date the winding up proceeding was commenced, it is not possible to appreciate how such a claim can be enforced after the winding up order is passed taking refuge under Article 137 of the Limitation Act.
Deposit of money in the Ponzi scheme cannot be treated as a loan given to the company and the depositor cannot be treated as a lender or creditor hence a ponzi depositor cannot get any benefit by application of the provision of Companies Act.
No period of limitation is provided in filing the winding up petition, therefore the question of condonation of delay in filing winding up petition does not arise.
Jeetender Gupta
(Expert) 20 September 2015
Presently all winding up to be filed under companies act 1956 only. It has to be filed in the HC of state where registered office of company against whom winding up is being filed. The companies act may not specify limitation but since the debt has to be enforceable so the limitation period of 3 years will become applicable. There are various case laws to this effect.
