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

Nilgiri Tea Co Ltd passed a special resolution on 3 May and its creditors approved it on 8 May. By when must the company notify the Registrar of Companies and the IBBI under section 59(4)?

Notice to the Registrar and the Board is due within seven days of the subsequent creditor approval, which here is 15 May. Section 59(4) counts from the resolution or the later creditor approval, as the case may be. Four weeks does not apply.

  1. A15 May, within seven days of the resolution on 3 May as the creditor approval was late
  2. B10 May, within seven days of the resolution
  3. C15 May, within seven days of the creditor approvalCorrect
  4. D31 May, within four weeks of the creditor approval

Explanation

Section 59(4) requires notice within seven days of the resolution or the subsequent approval by the creditors, as the case may be. Where creditor approval is needed and follows later, the seven days run from 8 May, giving 15 May. Counting from 3 May would wrongly ignore the subsequent approval.

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