Corporate Restructuring, Valuation and Insolvency · Winding-up by Tribunal under the Companies Act, 2013

Modes of Winding Up and Tribunal Jurisdiction

Updated 11 October 2026 · Fact-checked

Under the Companies Act, 2013, Chapter XX deals with winding up by the Tribunal. Section 270 applies Part I to it. Section 280 gives the Tribunal wide jurisdiction over suits, claims, priorities and any question arising in winding up. Voluntary winding up of solvent companies now runs under the IBC, 2016.

Understand Modes of Winding Up and Tribunal Jurisdiction

Winding up is the process by which a company's life ends. Its assets are sold, its debts are paid, and any surplus goes to members. Only after this is the company dissolved.

The Companies Act, 1956 had three modes: winding up by the Court, voluntary winding up, and winding up subject to supervision of the Court. The 2013 Act changed this. Section 270 now reads: the provisions of Part I apply to the winding up of a company by the Tribunal. The old voluntary-winding-up sections, such as 308, 309, 314 and 323, are shown as omitted with effect from 15-11-2016. Voluntary liquidation of a solvent company is now dealt with under the Insolvency and Bankruptcy Code, 2016, which is a separate chapter of your paper.

So for this topic, remember two routes. One is winding up by the Tribunal under the Companies Act, 2013. The other is voluntary liquidation under the IBC. In the exam, if the question asks about voluntary winding up under the Companies Act, 2013, say that those provisions were omitted and that the IBC now governs.

Section 280 is the jurisdiction section. Despite anything in any other law, the Tribunal can entertain or dispose of four things: (a) any suit or proceeding by or against the company; (b) any claim by or against the company, including claims by or against its branches in India; (c) any application under section 233; (d) any question of priorities or any other question, of law or fact, including those on assets, business, rights, duties or obligations, arising out of or in relation to winding up. It applies whether the suit, claim or application began before or after the winding-up order.

The Tribunal acts through a Company Liquidator. Under section 290 the liquidator has powers such as carrying on the business so far as necessary for beneficial winding up, selling property by public auction or private contract, selling the undertaking as a going concern, raising money on the security of assets, instituting or defending suits, and settling creditors' claims. These powers are subject to the Tribunal's overall control (section 290(2)). Some acts need the Tribunal's sanction under section 343. Section 360 lets the Official Liquidator exercise the Company Liquidator's powers and conduct inquiries if directed.

Key rules to remember

Section 270 - mode of winding up: Winding up by Tribunal → Part I applies; Substituted w.e.f. 15-11-2016. The 2013 Act text speaks only of winding up by the Tribunal.
Section 280 - Tribunal's jurisdiction: Suits + Claims + Section 233 applications + Priorities and any question of law or fact; Overrides any other law. Covers matters begun before or after the winding-up order.
Section 290 - Company Liquidator's powers: Powers exercised subject to Tribunal directions and overall control; Includes carrying on business, selling assets or the undertaking, raising money, suing, settling claims, hiring professionals.
Section 343 - sanction of Tribunal: Pay a class of creditors in full; compromise with creditors; compromise calls and debts → with Tribunal sanction; Any creditor or contributory can apply to the Tribunal about an exercise or proposed exercise of these powers.
Section 360 - Official Liquidator: Powers as prescribed + any Company Liquidator power + inquiries if directed; Inquiries are on direction of the Tribunal or Central Government.
Section 226 - investigation: Investigation continues despite voluntary winding up resolution or pending winding-up proceedings; Applies also where a section 241 application is made. If the Tribunal passes a winding-up order, the inspector informs it of the pending investigation.

How to solve Modes of Winding Up and Tribunal Jurisdiction questions

Use this order for any question on modes of winding up or Tribunal jurisdiction. It follows the provision, analysis, conclusion pattern.

1Identify the mode the facts point to: Tribunal winding up under the Companies Act, 2013, or voluntary liquidation under the IBC.
2State the rule: section 270 for the mode, section 280 for jurisdiction, sections 290, 343 and 360 for powers.
3Mark the key facts: who is a party, what is claimed, and whether the matter arose before or after the winding-up order.
4Match each fact to a limb of section 280 (suit, claim, section 233 application, priorities or any other question).
5If the question is about the liquidator's act, check whether it is a section 290 power or needs sanction under section 343.
6Write a clear conclusion in one or two lines and say what the Tribunal can do.
7Add a practical compliance point, such as the liquidator applying to the Tribunal for directions under section 290(1)(n).

Quickest way: Four-line answer frame

When to use it: Use when time is short and the question is a short note or a quick case on jurisdiction or modes.

Line 1: name the mode. Winding up by Tribunal is covered by section 270. Voluntary sections were omitted from 15-11-2016 and the IBC applies.
Line 2: quote section 280 and list its four limbs in brief.
Line 3: apply to the facts. Say which limb the dispute falls under.
Line 4: conclude that the Tribunal has jurisdiction, and that the liquidator acts under its control.

Common mistakes in Modes of Winding Up and Tribunal Jurisdiction

Writing that the Companies Act, 2013 still has three modes of winding up.
Students carry over notes from the 1956 Act.
Fix: Say that the 2013 Act text now deals with winding up by the Tribunal, and that voluntary winding up sections such as 308 and 309 are omitted w.e.f. 15-11-2016.
Citing sections 308, 309 or 314 as the law on voluntary winding up.
Old textbooks and videos still show them.
Fix: State that these sections are omitted. Refer to the IBC for voluntary liquidation.
Limiting section 280 to suits against the company.
Students remember only clause (a).
Fix: Recall all four limbs: suits by or against, claims by or against including branches in India, section 233 applications, and priorities or any other question.
Saying the Tribunal's jurisdiction starts only after the winding-up order.
Students assume jurisdiction follows the order.
Fix: Section 280 covers matters begun or arising before or after the order.
Treating all liquidator powers as free of control.
The list in section 290(1) looks absolute.
Fix: Add that powers are subject to Tribunal directions and overall control, and that section 343 acts need sanction.
Thinking winding-up or voluntary resolution stops an investigation.
Students assume proceedings cannot run in parallel.
Fix: Cite section 226: investigation is not stopped by a section 241 application, a special resolution for voluntary winding up, or other pending winding-up proceedings.

Worked examples

Example 1

Rahul Textiles Ltd is being wound up by the Tribunal. A supplier had filed a recovery suit against the company before the winding-up order. Another party now claims priority over the sale proceeds. Can the Tribunal deal with both matters?

Show the solution

Provision: section 280 gives the Tribunal jurisdiction over any suit or proceeding by or against the company, and any question of priorities, despite any other law.
Facts: the recovery suit is a suit against the company. The dispute over sale proceeds is a question of priorities.
Timing: section 280 applies whether the suit was instituted before or after the winding-up order.
Conclusion: the Tribunal can entertain or dispose of both.

Answer: Yes. The suit falls under section 280(a) and the priority dispute under section 280(d). The earlier filing of the suit does not take it out of the Tribunal's jurisdiction.

Example 2

The Company Liquidator of Mehta Steels Ltd, in winding up by the Tribunal, wants to compromise a disputed claim of a creditor and also to sell the whole undertaking as a going concern. What must he do?

Show the solution

Sale of the undertaking: section 290(1)(d) lets him sell the whole undertaking as a going concern. This is subject to Tribunal directions and overall control (section 290(2)).
Compromise with creditors: section 343(1)(ii) allows this only with the sanction of the Tribunal.
Remedy for objectors: any creditor or contributory may apply to the Tribunal on the exercise or proposed exercise of these powers (section 343(3)).
Practical step: he can apply to the Tribunal for directions under section 290(1)(n).

Answer: He may sell the undertaking as a going concern under section 290(1)(d), under the Tribunal's control. For the compromise with the creditor he must first obtain the Tribunal's sanction under section 343(1)(ii).

Exam tips

Begin every answer with the section number and its key words. Examiners look for the provision first.
In a mode-of-winding-up question, mention that the voluntary winding up sections are omitted and the IBC applies. This shows you know the current law.
List the four limbs of section 280 in short bullets and tie each to a fact in the case.
For liquidator questions, separate free powers (section 290) from sanctioned acts (section 343).
Close with a conclusion and one practical step, such as applying to the Tribunal for directions.

Practice questions from Winding-up by Tribunal under the Companies Act, 2013

Modes of Winding Up and Tribunal Jurisdiction in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Modes of Winding Up and Tribunal Jurisdiction: frequently asked questions

What are the modes of winding up under the Companies Act, 2013?

Section 270 as substituted deals only with winding up by the Tribunal, to which Part I applies. The earlier voluntary winding up sections, such as 308 and 309, are omitted w.e.f. 15-11-2016. Voluntary liquidation is now handled under the IBC.

What does section 280 cover?

It gives the Tribunal jurisdiction over suits and claims by or against the company, section 233 applications, and any question of priorities or other law or fact arising in winding up. It applies before or after the winding-up order.

What is the difference between winding up by the Tribunal and voluntary winding up?

Winding up by the Tribunal is ordered by the Tribunal and run by a liquidator under its control, under the Companies Act, 2013. Voluntary liquidation is started by the company itself and is governed by the IBC, not the Companies Act, 2013.

Can an investigation continue once winding up begins?

Yes. Section 226 says an investigation is not stopped by a section 241 application, a special resolution for voluntary winding up, or other winding-up proceedings before the Tribunal. If the Tribunal passes a winding-up order, the inspector informs it of the investigation.