Payment to creditor

I realise that the liability continues notwithstanding liquidation. However if the assets are sold privately the partners will take the money and disappear. To then apprehend these persons and bring them to book will be very difficult. I am therefor wanting to know if there is anyway a creditor can stop a firm from liquidating its assets, prior to settleing its dues. What legal options are available to me to portect my dues???

You must start a recovery proceeding for your dues. Even if the liquidation process is going on, it is not one going on through Court process. Hence, there is bound to be pilferage, especially in sale of properties.

You can also obtain an injunction order against the partners from selling the properties of the Partnership Firm. An advocate commissioner can also be appointed through court process to take charge of the assets of the Partnership Firm. You can also obtain an injunction against the partners from selling or alienating their personal properties, since they are personally liable for the debts of the Partnership.

All the above can however be done, only once you are in Court.

A creditor can file a suit for recovery and file an application under 38 rule 5 of cpc restraining the defendants to dispose off the properties thereunder till the decision of the suit.