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CS Professional · Insolvency and Bankruptcy - Law and Practice · Voluntary Liquidation of Companies

Ananya Textiles Pvt Ltd has no debt. Its directors made the declaration under section 59 on 1 March. By what date must the members pass the special resolution to liquidate voluntarily and appoint the insolvency professional as liquidator?

The members must pass the special resolution within four weeks of the directors' declaration, which here means by 29 March. The seven-day limit in section 59 relates to creditor approval and notification, not to the members' resolution.

  1. AWithin four weeks of the declaration, i.e. by 29 MarchCorrect
  2. BWithin seven days of the declaration, i.e. by 8 March
  3. CWithin thirty days of the declaration, i.e. by 31 March
  4. DWithin fourteen days of the declaration, i.e. by 15 March

Explanation

Section 59(3)(c) requires the special resolution within four weeks of the directors' declaration. Four weeks from 1 March is 29 March. The seven-day period applies to creditors' approval and to notifying the Registrar, not to the members' resolution.

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