What is voluntary winding up and what are its effects?
In the case of a voluntary winding up, the company shall from the commencement of the winding up cease to carry on its business except as far as required for the beneficial winding up of its business: Provided that the corporate state and corporate powers of the company shall continue until it is dissolved. Back.
What is voluntary winding up what are its effects in company law?
Consequences of voluntary winding up
The consequence on shareholders and members- if a company has limited shares, its shareholders are liable to pay the full amount up to their face value. He is not free of his obligation even if the company is liquidated.
What is the difference between members voluntary winding up and creditors voluntary winding up?
The main difference between a Members’ Voluntary Liquidation (MVL) and a Creditors’ Voluntary Liquidation (CVL) is that the MVL process is used by solvent companies to close down their business. In contrast, although still voluntarily undertaken, a CVL involves closure of a company that is insolvent.
What do you understand by winding up of a company and what are the different modes of winding up?
A company can be wound up in three ways : Compulsory winding up by the Court; Voluntary winding up : (i) Members’ voluntary winding up; (ii) Creditors’ voluntary winding up; Voluntary winding up subject to the supervision of the Court [Sec.
What do you understand by voluntary winding up describe the circumstances and effects of voluntary winding up of a company?
The winding up or liquidation of a company is the process by which a company’s assets are collected and sold in order to pay its debts. … A Court can compulsorily wind up a company. The shareholders or the creditors of the company can themselves apply to wind up the company in proceedings known as “voluntary winding up”.
Which of the following is the kind of voluntary winding up?
There are two kinds of voluntary winding up. They are; Member’s voluntary winding up. Creditors voluntary winding up.