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

Sunrise Textiles Ltd, a company with no assets left after paying its secured creditors, has a shareholder, Mr. Iyer, who holds fully paid-up shares registered in his name for over two years. Mr. Iyer wants to file a winding up petition before the Tribunal. Which statement is correct?

Mr. Iyer can file the petition. Under section 272(2), a contributory may present a winding up petition even though his shares are fully paid-up or the company has no assets or no surplus assets left for shareholders. No Central Government sanction is needed for a contributory.

  1. AHe cannot file because the company has no surplus assets to distribute among shareholders
  2. BHe cannot file because fully paid-up shareholders are not contributories
  3. CHe can file, because a contributory may petition even if shares are fully paid-up or the company has no assetsCorrect
  4. DHe can file only after obtaining sanction from the Central Government

Explanation

Section 272(2) says a contributory may present a petition even if he holds fully paid-up shares or the company has no assets or no surplus assets. Mr. Iyer has also held the shares for more than six months. The options denying his right ignore this express provision.

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