Section 357 of the Companies Act, 2013
Section 357 of the Companies Act, 2013 deals with:
Commencement of Winding Up by Tribunal
Bare Act Summary of Section 357:
When a company is being wound up by the Tribunal, the winding up is deemed to have commenced:
From the date of presentation of the petition for winding up — not from the date of the order of winding up.
Key Points:
This provision helps establish a legal point of commencement of the winding-up process, which is crucial for:
Determining the validity of transactions made by the company.
Identifying any fraudulent preferences or avoidance of transactions.
Fixing responsibility of the company’s officers and directors during the winding-up period.
It applies specifically to winding up by the Tribunal, not voluntary winding up.
Purpose:
To protect the interests of creditors and stakeholders by ensuring that any misconduct or improper transaction after the filing of the petition (but before the winding-up order) can still be scrutinized and reversed if necessary.
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