12.18.2 (Winding up by the Court.)

Winding up by the court, also called compulsory winding up, may be ordered in cases mentioned in s.433. The court will make an order for winding up on an application by and of the persons enlisted in s.439.

Courts having jurisdiction to wind up (s.10). The court having jurisdiction to wind up a company is the High Court having jurisdiction in relation to the place at which the registered office of the company concerned is situated, except to the extent to which jurisdiction has been conferred on any District Court or District courts subordinate to the High Court. However, winding up of a company with a paid up share capital of Rs 5 lakhs or more must take place in the High Court.

Grounds for compulsory winding up [s. 433(3)]. A company may be wound up by the court on the following grounds:

1. Special resolution. The company may , by special resolution, resolve that it be wound up by the court. The resolution may be passed for any cause whatsoever. However, the court may not order winding up if it finds it to be opposed to public interest or the interest of the company as a whole.

  2. Default in holding statutory meeting. If default is made in delivering the statutory report to the Registrar or in holding the statutory meeting, the company may be ordered to be wound up. Petition on this ground can be presented either by the Registrar or by a contributory. If it has to be filed by any other person it should be filed before the expiration of 14 days after the last day on which the statutory meeting ought to have been Held [s.439 (7)].

  3. Failure to commence business. If a company does not commence business within a year from incorporation or suspends business for a whole year, it may be ordered to be wound up. Failure to commence or to carry on business is not treated as a ground for compulsory winding up unless the company  has no intention of carrying on business or it has become impossible to do so. A company will not be wound up simply because of some temporary interruption, such as a trade depression or because it is waiting for further capital to be subscribed, In Murlidhar v. Bengal Steamship Co. [AIR (1920) Cal. 772] a company employed a steamer and purchased two flats. During the first world war, the Government acquired the flats which resulted in suspension of the business of the company for more than a year. The High Court of Calcutta held that “The suspension of business of the company for more than a year, is sufficiently accounted for and does not furnish an indication that there is no intention to carry on the business’.

But where the chances of resuming business are gloomy, the court may order for the winding up of the company [Rupa Bharati Ltd v. Registrar of Companies. (1969) Comp. L.J. 296].

However, in Eastern Telegraph Company Ltd., in. re (1947), it was Held that where a company ceases to do any business but is or becomes a holding company of subsidiaries engaged in the pursuit of the business, which it was previously doing, it cannot be said that the company has suspended its business for the whole year, so as to justify an order for its winding up.

4. Reduction in membership. If the number of members is reduced below the statutory minimum of 7 in a public company or 2 in a private company, the company may be ordered to be wound up.

  5. Inability to pay debts. The court may order a company to be wound up if it is unable to pay its debts. According to s.434, a company shall be deemed to be unable to pay its debts if: (a) A creditor for more than Rs 500 has served on the company at its registered office a demand under his hand requiring payment and the company has for three weeks thereafter neglected to pay or secure or compound the sum to the reasonable satisfaction of the creditor; or (b) execution or other process issued on a judgement or order in favour of a creditor of the company is returned unsatisfied in whole or in part; or (c) it is proved to the satisfaction of the court that the company is unable to pay its debts, taking into account its contingent and prospective liabilities.

The provision that the court is to take into account the company’s contingent and prospective liabilities is important. A company which has to date paid  all its debts as they fell due may still be ordered to be wound up if a consideration of its assets and liabilities shows that it will or may shortly be unable to do so. Inability is to be seen in the commercial sense of a running enterprise and not in the sense of liquidation, i.e., if the company cannot meet its current demand, even though its assets, when realised, would exceed its liabilities, it will be deemed to be unable to pay its debt and may be wound up.

But the important condition to be fulfilled is that the creditor should have a complete title to the debt and the debt must have become payable. where there is a bona fide dispute regarding the debt, the company cannot be charged to have neglected to pay it.

  6. Just and equitable. The court may also order for the winding up of a company if it is of the opinion that it is just and equitable that the company should be wound up. In exercising its power on this ground, the court shall give due weight to the interest of the company, its employees, creditors and shareholders and the interest of the general public. The relief based on the just and equitable clause is in the nature of a last resort when other remedies are not efficacious enough to protect the general interests of the company. while in the above five cases definite conditions should be fulfilled but in the ‘just and equitable’ clause the entire matter is left to the ‘wide and wise’ direction of the court. The winding up must be just and equitable not only to the persons applying but also to the company and to all its shareholders. [Hind Overseas Pvt. Ltd. v. R.P. Jhunhhunwala (1977) ASIL. XIII] A few of the examples of  ‘just and equitable’ grounds on the basis of which the Court may order the winding up are given below:

  (i) When the substratum of the company has gone. The substratum of a company is deemed to be gone where its objects have failed or become impossible of achievement. [Re-Bleriot Aircraft Co. (1916) 63T.L.R. 255]. In this case a company was formed to acquire the English portion of M. Bleriot’s aircraft business. M. Bleriot refused to carry out the contract because he found that it was not in a position to carry out the contract; inter alia, it had not got the necessary working capital. Held, the substratum of the company had gone. However, a temporary difficulty which does not knock out the company’s bottom shall not be permitted to become a ground for liquidation [Re-Shah Steam Navigation Co. (1908) 10Bom. L.R.107]. The substratum of a company cannot be said to have gone or disappeared even where its sole undertaking is sold so long as there is some other business coming within the objects stated in its memorandum which it can carry on (Re Kiston & Co. Ltd. ). In re Kaithal and General Mills Co. Ltd. (1951) 31 Comp. Cas.461, the Court laid down the following tests to determine as to whether the substratum of the company has disappeared: (a) where the subject matter of the company has gone; or (b) the object of which it was incorporated has substantially failed; or (c) it is impossible to carry on the business of the company except at a loss which means that there is no reasonable hope that the object of trading at a profit can be attained; or (d) the existing or probable assets are insufficient to meet the existing liabilities.

  (ii) When there is a complete deadlock in the management. A company will be wound up on this ground even though it is making good profits. In Re Yenidje Tobacco Co. Ltd. A and B, the only shareholders and directors of a Private Limited company became so hostile to each other that neither of them would speak to the other except through the secretary. Held, there was a complete deadlock and consequently the company was wound up.

  (iii) Where the company was formed for fraudulent or illegal purpose. For this purpose, fraud in the prospectus or in the manner of conducting company’s business is not sufficient. It must be shown that the original object of creating the company was fraudulent or illegal [Re T. E. Brismead  & Sons Ltd. (1897)1 Ch.45].

  (iv) Where the principal shareholders have adopted an aggressive or oppressive policy towards the minority [R. Sabapathy Rao v. Sabapathy Press Ltd. AIR (1925) Mad. 489]. However, the Court will order winding up only when it is satisfied that it is impossible for the business of the company to be carried on for the benefit of the company as a whole because of the way in which voting power is Held and used.

  (v) When the company is a ‘bubble’,i.e.,it never had any real business [Re-London and Country Coal C. (1867) L.R.3 Eq. 355].

  (vi) Where the business of the company cannot be carried except at loss. But, mere apprehension on the part of some shareholders that loss instead of gain will result has been Held to be no ground [Re-Mahamandal Shastra Prakashik Samiti Ltd. (1917 )

15 All L.T. 193].

Similarly, in Re-Shah Steamship Navigation Co. [(1901) 10 Bom. L.R. 107]. it was observed that ‘The Court will not be justified in making winding up order merely on the ground that the company has made losses and it was likely to make further losses.

  (vii) Where a private company is in essence or substance a partnership, it may be ordered to be wound up if such circumstances exist under which it would be just and equitable for the court to order for the dissolution of the partnership firm. In Re- Davis and Coltett Ltd. [(1935) Ch. 693] one member improperly excluded the other, who Held half the shares, from taking part in the company’s business. Held, the company be wound up.

  (vii) Requirements for Investigation. Where directors were making allegations of dishonesty against each other in respect of defalcations of the funds of the company, the company was ordered to be wound up on the ground that it was a case in which the conduct of some of the officers of the company required an investigation which could only be obtained in a winding up by the Court [Re Varieties Ltd. (1893) 2 Ch. 235].

Who may petition (s. 439). A petition for the compulsory winding up of a company may be presented by: 1. the company itself by the passing of a special resolution; or 2. any creditor or creditors, including any contingent or prospective creditor or creditors; or 3. a contributory or contributories; or 4. any combination of creditors, company or contributories acting jointly or separately; or 5. the Registrar; or 6. any person authorised by the Central Government, as per s.243.7.the official liquidator

(s.440).

The company [s.439(1) (a)]. A company may make a petition for its winding up, when the members of the company have so resolved by passing a special resolution. However, it is not very common for companies to apply for winding up orders since, if desired, they have only to pass a special resolution for voluntary winding up under s.484 of the Act. But, where the directors find the company to be insolvent due to circumstances which ought to be investigated by the Court, they may file a petition for winding up order on behalf of the company. In such circumstances, a director may make a petition even without obtaining the sanction of the general meeting of the company [State of Madras v. Madras Electric Tramway Ltd. AIR (1956) Mad.181].

Creditor’s petition [s.439 (1) (b)]. A creditor has a right to a winding up. If he can prove that he claims an undisputed debt and that the company his failed to discharge it. The word ‘Creditor’ includes secured creditor, debenture holder and a trustee for debenture holders. It is not even necessary that the secured creditor should give up his security [In Re-India Electric works (1969) 2 Comp. L.T. 169]. A contingent or prospective creditor (such as the holder of a bill of exchange not yet matured or of debentures not yet payable) is also entitled to petition for winding up the company. But, he must give a reasonable security for costs and establish a prima facie case for winding up [s.439 (8)] .A policy holder of a life assurance company is not creditor and he cannot apply for the winding up the company.

Sometimes a creditor’s petition is opposed by other creditors. In such cases the Court may ascertain the wishes of the majority of the creditors. However, the opinion of the majority of creditors does not bind the court. The question will ultimately depend upon the state of the company. If the company is commercially insolvent and the object of trading at a profit cannot be attained, winding up order will follow as a matter of course.

A creditors’ petition is generally based on the ground that the company is unable

to pay its debts. He will not ordinarily be heard to urge that a winding up order should be made because the substratum of the company is gone which is usually the proper concern of the company’s shareholders [Bukhtiarpur Bihar Light Rly. co. Ltd. v. Union of India, AIR (1954) Cal.499].

However, if the debt of a petitioning creditor is disputed no order for winding up

can be made [Md. Amin Bros v. Dominition of India, AIR(1952) Cal.323] But the mere fact that the creditor files a suit for the realisation of the debt, when his petition for winding up the company is already pending does not debar him from proceeding with his petition for winding up the company. [Central Bank of India v. Sakhani Mining and Engineering Industries Pvt. Ltd. (1977)ASIL XIII427]. The reason being that a winding up proceeding is not merely for the benefit of the petitioner, but for that of all contributories and all creditors

Contributory’s petition [s.439(1) (c)]. A ‘contributory’ means any person liable to contribute to the assets of a company in the event of its being wound up. But for this purpose the tem ‘contributory’ includes a holder of paid shares. A ‘contributory’, however, may petition only: (i) on the ground that the number of members is reduced below the statutory minimum of seven members in case of public company and two in case of a private company; (ii) on any other ground if the shares in respect of which he is a contributory or some of them were originally allotted to him, or/have been held by him and registered in his name for at least six out of the eighteen months preceding the commencement of the winding up, or/have devolved upon him through the death of the former holder.

  Example. A transfer though executed and stamped in June, 1997, was registered in October, 1998. The shareholder presented a winding up petition in December, 1998. Held, the petition was not valid since she had not held shares for six months as required by the Act.

A holder of fully paid shares is a contributory for the purpose of a petition not because he is liable to contribute but because he may have an interest in the assets in a winding up. The section provides: "A contributory shall be entitled to present a petition for winding up a company notwithstanding that he maybe the holder of fully paid-up shares, or that the company may have no assets at all or may have no surplus assets left for distribution among the shareholders after the satisfaction of its liabilities."

The legal representative of a deceased shareholder may petition. Even an insolvent shareholder, whose name is still there on the register, may, at the instance of the assignee, petition.

Joint petition [s.439(1) (d)].By all or any of the parties specified above. This means that any combination of the company, the creditors and the contributories can present a petition for winding up.

The registrar [s.439(1) (e)]. The registrar may file a petition where: (i) a default is made in delivering the statutory report to him or in holding the statutory meeting; or (ii) the company has not commenced its business within a year from its incorporation; or (iii) the number of its members has fallen below the statutory minimum; or (iv) the financial condition of the company, as disclosed in its balance-sheet or from the report of a special auditor appointed under s.233A or any inspector appointed under Ss.235 to237 it appears that it is unable to pay its debts, or (v) it is just and equitable that the company be wound up.

The petition on the ground of default in delivering the statutory report or holding the statutory meeting cannot be presented before the expiration of 14days after the last day on which the statutory meeting ought to have been held. In any case, the registrar cannot present the petition unless sanctioned by the Central Government. The Central Government shall give its approval only after an opportunity of being heard has been given to the company. Further, such petition must be filed within a reasonable time of the obtaining of the sanction, failing which the court shall not recognise the sanction, as valid. [Registrar of Companies v. All India Groundnut Syndicate Ltd. 55 Bom. L.R. 312].

Central government petition (s.243). The Central Government may petition for winding up where it appears from the report of inspectors appointed to investigate the affairs of a company under s.235 that the business of the company has been conducted for fraudulent or unlawful purposes. The Government may authorize any person to act on its behalf for the purpose. [s.439 (1)( b)] .

Official liquidator’s petition (s.440). An official liquidator may present a petition for winding up by the Court where a company is being wound up voluntarily or subject to the supervision of the court. The court, however, shall not make a winding up order unless it is satisfied that the voluntary winding up or winding up subject .to the supervision of the Court cannot be continued with due regard to the interest of the creditors or contributories or both.

Commencement of winding up (s.441). The winding up of a company by the court shall be deemed to commence at the time of the presentation of the petition for the winding up. If no order for winding up is made and the winding up petition is

Dismissed, the date of presentation of the winding up petition has no relevance. As such, until winding up order is made, the company will have to comply with the requirements of the Companies Act as are required of company not ztsound try. Alio the words, shall be deemed to commence' indicate that although the winding up of a company does not in fact commence at the time of the presentation of the petition, it nevertheless shall be taken to commence from that time if and when the winding up order is made. However, where before the presentation of a petition for the winding up of a company by the Court, a resolution has been passed by the company for voluntary winding up, the winding up of the company is deemed to have commenced at the time of the passing of the resolution.

 Procedure for winding up order. (1) The winding up petition must be presented to the prescribed authority. It may be recalled that it is primarily the High Court which has the jurisdiction to wind up companies under s.10. The Central Government may, however, empower any District Court to exercise that jurisdiction in respect of small companies with the paid-up capital of not more than Rs 5 lakh and having registered office within the district. (The Court may allow the company sought to be wound up to show cause against the admission of the winding up petition and no one else, not even creditors, inclined to oppose the winding up [Union of India v. Shalimar Works Ltd. (1977) 47 Cornp.Cas.6641.

(2) After the presentation of the petition but before the hearing, application may be made to the court by either the company, creditor or contributories:(a) To appoint a provisional liquidator to safeguard the assets pending the hearing. Before making such appointment, however, the court must give notice to the company so as to enable it to make its representation in the matter unless, for reasons to be recorded in writing, it thinks fit to dispense with such notice. The powers of the provisional liquidator are the same as those of a liquidator unless limited by the court (s.450). (b) to stay any pending action against the company (s.442).

(3) On hearing a winding up petition, the court may [s.443(1)]: (i) dismiss it, with or without costs; or (ii) adjourn the hearing conditionally or unconditionally; or (iii) make any interim order that it thinks fit; or (iv) make an order for winding up the company with or without costs, or any other order that it thinks fit. The court cannot, however, refuse to make a winding up order on the ground only that the assets of the company have been mortgaged to an amount equal to or in excess of those assets or that the company has no assets. "Where the petition is presented on the ground that it is just and equitable that the company should be wound up, the court may refuse to make an order of winding up if it is of the opinion that some other remedy is available to the petitioners and that they are acting unreasonably in seeking to have the company wound up instead of pursuing that other remedy." [s.443 (2)1.

Where the petition is presented on the ground of default in delivering the statutory report to the registrar or in holding the statutory meeting, the court may: (a) instead of making a winding up order, direct that the statutory report shall be delivered or that a meeting shall be held; and (b) order the costs to be paid by persons who, in the opinion of the court, are responsible for the default [s.443 (3)].

In all matters relating to the winding up of a company, the court may have regard to the wishes of creditors or contributories of the company as proved to it by any sufficient evidence and for the purpose may direct that their meetings may be held or conducted as directed by the court (s.557).

Consequence of winding up order. The consequence of the winding up order by the Court are as follows:

        1. The court must, as soon as the winding up order is made, cause intimation

There of to be sent to the official liquidator and the Registrar (s.444).

        2. The petitioner and the company must also file with the Registrar within 30 days a certified copy of the order [s.445(1)]. The Registrar should file with himself a certified copy of the winding up order of the court when himself is a petitioner

under s.439.If default is made in filing the certified copy of the order, the petitioner, or the company and every officer of the company who is in default, shall be punishable with fine up to Rs 100 for every day during which the default continues (s.445).

        3. The Registrar should then make a minute of the order in his books relating to the company and notify in the Official Gazette that such an order has been made

[s.445(2)].

        4. The order for winding up is deemed to be a notice of discharge to the officers and employees of the company, except when the business of the company is continued [s.445(3)].

        5. The order operates in the interests of all the creditors and all the contributories,

no matter who is fact asked for it (s.447).

       6. The Official Liquidator, by virtue of his office becomes the liquidator of the

company and takes possession and control of the assets of the company (s.449).

       7. All actions and suits against the company are stayed, unless the court gives leave to continue or commence proceedings (s.446). In Official Liquidator v. Dharti Dhan(P) Lid [ASIL(1977)4291, the Supreme Court held that a stay order is not mandatory and a stay should not be granted if the object of applying for it appears to be merely to delay adjudication on a claim and thereby to defeat justice.

       8. Any suit or proceeding pending in any other court shall be transferred to the court in which the winding up of the company is proceeding [s.446(3)].

         9. All the power of the Board of Directors cease and the same are then exercised by the liquidator [Ss.491 & 505].

        10. On the commencement of winding up, the limitation ceases to run in favors of the company.

        11. Any disposition of the property of the company and any transfer of shares in the company or alteration in the status of members made after the commencement of winding up shall, unless the court otherwise orders, be void [s.536(2)].

        12. Any attachment, distress or execution put in force, without leave of the court, against the estate or effects of the company after the commencement of the winding up shall be void [s.537 (a)]but not for dues payable to Government [s.537(2)].

        13. Any sale held, without leave of the court, of any of the properties or effects of the company after the commencement of winding up shall be void [s.537(b)].

        14. Any floating charge created within 12 months preceding the commencement of winding up is void unless it is proved that the company after the creation of the charge was solvent, except as to, any cash advanced at the time of or subsequent to the creation of the charge or to any interest on that amount @ 5% or such other rate notified by the Central Government (s.5345). The secured creditor is outside the winding up and can realize his security without the leave of the winding.tp court, though if he files a suit or takes other legal Proceedings for the realization of his security he is bound to obtain the leave of the Winding up court and it will automatically, be granted [Supreme Court in M.K. Ranganathan v. Government of Madras. (1955) 25 Comp. Cas. 344].

Statement of affairs to be made to the liquidator (s.454). When a winding up order is made by the Court, the directors of the company must make to the liquidator a statement as to the affairs of the company, stating the following particulars: (i) the debts and liabilities of the company; (ii) the assets of the company, showing separately the cash in hand and in bank, if any; (iii) the name, residence and occupation of each creditor stating separately the amount of secured debts and unsecured debts; (iv) the debts due to the company and the name, residence and occupation of each person from whom the sum is due and the amount likely to be realized there from.

The object of such a statement is to give the liquidator an idea as to the financial affairs and liabilities of the company. The creditors and contributories of the company can inspect the statement. The statement should be made within 21 days (or such extended time not exceeding 3 months as the official liquidator or court may for special reasons allow) after the relevant date. The relevant date is the date of the winding up order by the court or where a provisional liquidator is appointed, the date of his appointment. The statement must be submitted and verified by affidavit by one or more of the persons who, at the relevant date are the Directors and by the person who at that time is the Manager, Secretary or other Chief officer of the company. Defaulter shall be punishable with imprisonment upto 2 years or with fine upto Rs 100 for every day during which default continues or with both.

Committee of inspection. The Court may, at the time of making an order of winding of a company or at any time thereafter, direct that there shall be appointed a committee of inspection to act with the liquidator. In such a case the liquidator must, within 2 months from the date of such direction convene a meeting of the creditors of the company for the purpose of determining who are to be members of the committee. Within 1,4 days from the date of the creditors meeting (or such further time as the court in its direction may grant for the purpose), the liquidator should convene a meeting of the contributories to consider the decision of the creditors' meeting with respect to the membership of the committee. It is open to the meeting of the contributories to accept the decision of the creditors' meeting with or without modifications or to reject it. The liquidator must apply to the court for directions as to what the composition of the committee shall be and who shall be members thereof . However, it will not be necessary to seek directions in this regard ushere the meeting of the contributories accept the decision of the creditors' meeting in its entirety.

Section 465 provides: (1) a committee of inspection cannot have more than 12 members; (2) the committee shell have the right to inspect the account of the liquidator at all reasonable time;(3)it must meet at such time as it may from time to time appoint and the liquidator or any member of the committee may also call a meeting of the  committee shell be 1/3^rd of the total number or two whichever is higher;(5) a member of the committee may resign by notice in writing. But where a member of the committee is adjudged an insolvent or compound or arranges with his creditors, or is absent from five consecutive meetings of the committee without the leave of the members, he shall cease to remain a member.

General powers of the court

1.power of court to stay winding up (s.446). The court may at any time after making a winding up order (on the application either of the official Liquidator of any creditor or contributor and on proof to the satisfaction of the court that all proceeding in relation to the winding up order be stayed)make an order staying the proceeding either altogether or for a limited time, on such terms and conditions as the Court thinks fit.

2. Settlement of the list of contribution(s.467).The court has power to cause the assets of the company to be collected and applied in discharge of its liabilities. For this purpose the court has the power to make a list of contributories. In settling the list of contributories the court shell distinguish between those who are contributories in their own right and those who are contributories as being representatives of, or liable for the debts of others.

3. the power to make call (s.470).the court is empowered to make call on all or any of the contributories to the extent of their liability. It should be noted that no statutory liability for an unpaid call can be set off against a credit except in the following cases (a) in the cases of an unlimited company, a contributory may set off his debt  against  any money due to him from the company on any independent dealing  or contract with the company .but no set off is allowed for any money due to him as a member of the company in respect of any dividend or profit; (b) if, in the case of a limited company, there is any director or manager whose liability is unlimited, he shall have the same right of set off as described in (a) above; (c) in the case of any company, whether limited or unlimited when all the creditors have been paid in full, any money due on any account whether to a contributory from the company may be allowed to him by way of set off against any subsequent call.

4. Payment into bank of moneys due to company (s.471). The court may order any contributory, purchaser or other person from who any money is due to the company to pay the money into the public account of India in the Reserve Bank of India instead of to the liquidator.

5. Power to exclude creditors not proving in time (s.474).The court may fix a time or times within which creditors are to prove their debts or claims. In such a case, if the creditors fail to establish their claims in time, they may be excluded from the

benefit of any distribution made.

6. Adjustment of rights of contributories (s.475).The court is empowered to adjust the right of the contributories among themselves and distribute any surplus among the person entitled thereto.

7. Power to order costs (s.476). The court may, in the event of assets being insufficient to satisfy the liabilities, make an order for the payment out of the asset, of the costs, charges and expenses incurred in the winding up, in such order of priority inter se as the court thinks just.

8. Power to summon persons suspected of having property of company, etc. (s.477). The court may summon before it any officer of the company or person known or suspected to have in his possession any property or books or papers of the company or known or suspected to be indebted to the company. Any such person may be examined on oath. The court may also require him to produce any books and papers in his custody or power relating to the company; but where he claims any lien on books or papers produced by him, the production must be without prejudice to that lien.

If any officer or person summoned, after being paid or tendered a reasonable sum for his expenses, fails to appear before the court at the time appointed without any valid reason, the court may cause him to be apprehended and brought before the court for examination

9. Power to order public examination of promoter, directors etc. (s.478). Where the Official Liquidator has made a report to the court, stating that in his opinion a fraud has been committed by any person in the promotion or formation of the company, or by any officer of the company since its formation, the court may direct that person or officer may appear before the court and be publicly examined. Examination shall relate to the promotion or formation or the conduct of the business of the company, or as to his conduct and dealings as an officer thereof. Official Liquidator, any creditor or contributory may take part in such examination. The court may put such questions to the person examined as it thinks fit. The person shall be examined on oath and must answer all such questions as the court may put or allow to be put, to him. Notes of the examination must be taken in writing and must be read over to or by and signed by the person examined and may thereafter be used in evidence against him. Statement so recorded shall be open to the inspection of any creditor or contributory at all reasonable times.

            10. To order the appointment of a committee of inspection (already discussed)

11. Power to arrest a contributory intending to abscond (s.479). At any time (either before or after making a winding up order), the court may, on proof of probable cause for believing that a contributory is about to quit l:rdia or otherwise to abscond or is about to remove or cancel any of his property, for the purpose of evading payment of calls or of avoiding examination in respect of the company, cause: (a) the contributory to be arrested any court may order; and (b) his books and papers and movable property be seized and safely kept until such time as the court may order.

12. Power to order dissolution of the company (s.481.). When the affairs

for of a company have been completely wonder up or when the court is the opinion that the liquidator cannot proceed with the winding up of a company for want of funds and assets or for any other. Reason whatsoever and it is just and reasonable in the  Circumstances of the case that an order of dissolution of the company should be Made, the court shall make an order that the company be dissolved from the date of order. The liquidator must, within 30days, send a copy of  the order to the registrar who shall make in his book a minute of the dissolution of the company. If he make a default in  forwarding a copy as aforesaid, he shall be punishable with fine which may extend to Rs 50 for every day during which the default Continues.

On the expiry of 5 years from the date of dissolution, the name of the company should be struck off the Register. But within 2years of the date of the dissolution On application by the liquidator of the company or by any other person who Appears to the court to be interested, the court may make an order, upon such terms as the court thinks fit, declaring the dissolution to have been void, after such an Order is passed; such proceedings may be taken as might have been taken if the Company had not been dissolved (s. 559).