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CS Professional · Corporate Restructuring, Valuation and Insolvency · Voluntary Liquidation

Kaveri Textiles Ltd, which has no default outstanding, wishes to liquidate voluntarily. Its directors sign a declaration on 3 March. Within what period must the members pass the special resolution requiring voluntary liquidation and appointing an insolvency professional as liquidator?

The members must pass the special resolution within four weeks of the directors' declaration. Seven days applies to creditor approval and to notifying the Registrar and the Board, so it is the wrong period for the members' resolution.

  1. AWithin four weeks of the declarationCorrect
  2. BWithin seven days of the declaration
  3. CWithin fourteen days of the declaration
  4. DWithin ten days of the declaration

Explanation

Section 59(3)(c) requires the special resolution within four weeks of the directors' declaration. Seven days is the period for creditor approval and for notifying the Registrar, not for the members' resolution.

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