Insolvency and Bankruptcy - Law and Practice · Winding-Up by Tribunal

Modes of Winding Up and Jurisdiction of Tribunal

Updated 11 October 2026 · Fact-checked

Under the Companies Act, 2013 as it now stands, Section 270 provides for one mode of winding up: winding up by the Tribunal, governed by Part I of Chapter XX. Voluntary winding up sections were omitted from 15 November 2016. Section 280 gives the Tribunal wide jurisdiction over suits, claims, priorities and other questions.

Understand Modes of Winding Up and Jurisdiction of Tribunal

Winding up is the process by which a company's life ends. Its assets are collected and sold, debts are paid in order, any surplus goes to members, and the company is then dissolved. The Companies Act, 2013 originally listed two modes: winding up by the Tribunal and voluntary winding up. Older study material and the 1956 Act also had a third: winding up subject to the supervision of the court.

The position has changed. Section 270, as substituted by Act 31 of 2016 with effect from 15-11-2016, now reads: "The provisions of Part I shall apply to the winding up of a company by the Tribunal under this Act." So, under this Act, the only mode left is winding up by Tribunal.

Voluntary winding up has not disappeared from the law. It has moved to the Insolvency and Bankruptcy Code, 2016. The Companies Act sections on it are omitted: Section 308 (commencement of voluntary winding up), Section 309 (effect of voluntary winding up), Section 314 (powers and duties of Company Liquidator in voluntary winding up) and Section 323 (costs of voluntary winding up). A solvent company that wants to wind up voluntarily now uses Section 59 of the IBC. Do not write that the Companies Act still has a voluntary mode.

The Tribunal here is the National Company Law Tribunal. Section 280 gives it jurisdiction, notwithstanding anything in any other law, to entertain or dispose of: any suit or proceeding by or against the company; any claim by or against the company, including claims by or against its branches in India; any application under Section 233; and any question of priorities or any other question of law or fact, including those about assets, business, rights, duties or anything arising out of or relating to the winding up. This applies whether the suit, claim or question arose before or after the winding up order.

Transition matters also appear in the law. Section 434 transfers pending proceedings from the Company Law Board, and certain winding-up proceedings from High Courts and District Courts, to the Tribunal. A proviso keeps some voluntary winding-up cases, where notice by advertisement had been given under Section 485 of the 1956 Act but the company was not dissolved before 1 April 2017, under the 1956 Act and the Companies (Court) Rules, 1959.

Key rules to remember

Section 270: mode of winding up: Winding up under the Companies Act, 2013 = winding up by Tribunal, under Part I; Substituted by Act 31 of 2016, effective 15-11-2016. It is the only mode under this Act.
Omitted voluntary winding up sections: Sections 308, 309, 314 and 323 are omitted; Commencement, effect, liquidator's powers and costs of voluntary winding up. Omitted w.e.f. 15-11-2016. Voluntary liquidation is now under Section 59 of the IBC.
Section 280: jurisdiction of Tribunal: Tribunal hears: (a) suits or proceedings by or against the company; (b) claims by or against the company and its Indian branches; (c) applications under Section 233; (d) priorities and any other question of law or fact arising out of or relating to winding up; It applies notwithstanding any other law, and covers matters before or after the winding up order.
Section 226: investigation not stopped: Investigation continues despite Section 241 application, voluntary winding up resolution, or pending winding up before the Tribunal; If the Tribunal passes a winding up order, the inspector informs it of the pending investigation. Directors and employees are not absolved from participating or from liability.
Section 434: transfer of pending proceedings: Company Law Board matters and notified High Court or District Court winding-up proceedings move to the Tribunal; Only proceedings at a stage prescribed by the Central Government are transferred. Others continue under the 1956 Act and the Companies (Court) Rules, 1959.

How to solve Modes of Winding Up and Jurisdiction of Tribunal questions

Use this order for any question on modes of winding up or the Tribunal's jurisdiction. It follows the provision, facts, conclusion pattern the examiner expects.

1Identify what is asked: the mode of winding up, the forum, or the Tribunal's power over a particular dispute.
2State the current law first: Section 270 applies Part I to winding up by the Tribunal, and the voluntary winding up sections are omitted.
3If voluntary winding up is mentioned, say that it now falls under Section 59 of the IBC and that the Companies Act sections 308, 309, 314 and 323 are omitted.
4Match the facts to a limb of Section 280: suit, claim, Section 233 application, or priorities and other questions.
5Check timing. Section 280 applies whether the matter arose before or after the winding up order.
6Check for old proceedings. If the matter was pending in 2016 or earlier, consider Section 434 and its provisos.
7Conclude clearly: name the forum, the section and the result in one or two sentences.

Quickest way: Three-check method for forum questions

When to use it: Use it when the question gives a short fact pattern and asks which forum or mode applies.

Check 1: Is the company being wound up under the Companies Act? Then the mode is winding up by Tribunal (Section 270).
Check 2: Is it a voluntary liquidation by a solvent company? Then answer: IBC Section 59, not the Companies Act.
Check 3: Is it a dispute linked to the winding up, such as a claim, suit or priority question? Then answer: Tribunal under Section 280, before or after the order.

Common mistakes in Modes of Winding Up and Jurisdiction of Tribunal

Writing that the Companies Act, 2013 has three modes of winding up.
Older books and the Companies Act, 1956 list the Tribunal or court, voluntary and supervised modes.
Fix: Quote Section 270 as substituted in 2016: only winding up by Tribunal remains under this Act.
Saying voluntary winding up is governed by Sections 308 and 309 of the Companies Act, 2013.
Those section numbers still appear in older notes.
Fix: State that Sections 308, 309, 314 and 323 are omitted w.e.f. 15-11-2016 and that voluntary liquidation is under Section 59 of the IBC.
Treating Section 280 jurisdiction as available only after a winding up order is passed.
Students link jurisdiction only to the order itself.
Fix: Quote the closing words of Section 280: it applies whether the suit, claim or question arose before or after the order.
Leaving out the company's Indian branches when listing claims under Section 280.
Students memorise the headline limbs and skip the detail.
Fix: Write 'claims by or against the company, including claims by or against any of its branches in India'.
Saying an investigation stops once winding up begins.
Students assume one process displaces the other.
Fix: Cite Section 226: an investigation is not stopped by a winding up proceeding or a voluntary winding up resolution, and directors stay liable for the inspector's findings.

Worked examples

Example 1

Sundaram Textiles Ltd, a solvent Chennai company, passes a special resolution to close down. A shareholder says the company should follow Sections 308 and 309 of the Companies Act, 2013. Advise.

Show the solution

Provision: Sections 308 (commencement of voluntary winding up) and 309 (effect of voluntary winding up) were omitted w.e.f. 15-11-2016.
Section 270 now applies Part I only to winding up by the Tribunal.
Analysis: the shareholder relies on omitted provisions, so the advice is wrong.
A solvent company wishing to liquidate voluntarily proceeds under Section 59 of the IBC.

Answer: The shareholder is incorrect. Sections 308 and 309 are omitted. Sundaram Textiles should use voluntary liquidation under Section 59 of the IBC. The Companies Act mode is winding up by Tribunal only.

Example 2

Winding up of Kaveri Exports Ltd has been ordered by the Tribunal. A supplier has a claim against its Mumbai branch, and a dispute has arisen about priority between two creditors. Which forum decides these?

Show the solution

Provision: Section 280 gives the Tribunal jurisdiction over any claim by or against the company, including claims by or against its branches in India.
The same section covers any question of priorities or any other question of law or fact arising out of or relating to winding up.
Analysis: the supplier's claim relates to a branch in India, so it falls within Section 280(b). The creditor dispute is a priority question under Section 280(d).
Timing: the section applies whether the question arose before or after the winding up order.

Answer: The Tribunal decides both the branch claim and the priority dispute under Section 280, notwithstanding any other law.

Exam tips

Open every answer on this topic with the current Section 270 position. It shows you know the 2016 change.
Learn the four limbs of Section 280 as suit, claim, Section 233 application and priorities or other questions.
Name the omitted sections 308, 309, 314 and 323 and point to Section 59 of the IBC when voluntary winding up appears.
In case-based questions, write provision, analysis of facts, then conclusion in separate short paragraphs.
Mention Section 434 only when the facts refer to proceedings pending from the 1956 Act era.

Practice questions from Winding-Up by Tribunal

Modes of Winding Up and Jurisdiction of Tribunal 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 Jurisdiction of Tribunal: frequently asked questions

How many modes of winding up are there under the Companies Act, 2013?

Only one remains: winding up by Tribunal under Section 270. The earlier voluntary winding up provisions were omitted w.e.f. 15-11-2016. Voluntary liquidation of a solvent company now falls under the IBC.

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

Winding up by Tribunal is ordered by the NCLT under the Companies Act, Part I. Voluntary winding up was started by the company itself, and its Companies Act provisions are omitted. It is now done through Section 59 of the IBC.

What does Section 280 of the Companies Act, 2013 do?

It gives the Tribunal jurisdiction over suits and claims by or against the company, Section 233 applications, and questions of priorities or any other question arising out of winding up. It applies before or after the winding up order.

Does an investigation stop when winding up starts?

No. Under Section 226, an investigation is not stopped only because of a winding up proceeding or a voluntary winding up resolution. If the Tribunal orders winding up, the inspector informs it and the Tribunal passes suitable orders.