Winding up Rules 2020 Pdf Nigeria
First, Rule 4 applies to “any legal action” in liquidation proceedings. The fact that the applicant was the liquidator was irrelevant, since liquidators are not exempt from Rule 4 of the CWR. Second, as Okoro JSC rightly observed in Ecobank v. Honeywell, the language used in CWR Rule 4 is mandatory and leaves no room for freedom of movement. The considerations highlighted were therefore irrelevant. Worse still, they were used to deprive third parties of the right to be heard on an issue that clearly affected their interests. The court should have confined itself to the sole examination provided for in Article 4, namely whether a decision is sought against a person. Atul Pandey, a partner at Khaitan and Co, said the striking feature of the new rules notified by the MCA was the summary winding-up procedure introduced by Part V of the winding-up rules. By approving the central government for the liquidation of enterprises instead of NCLTs, it shortens the overall liquidation periods. Akila Agarawal, Partner and Head of M&A, Cyril Amarchand Mangaldas & Co, expressed her opinion that liquidation proceedings have been ongoing for a very long time for reasons other than the inability to pay debts. With the introduction of the Companies (Liquidation) Rules 2020, it reduces the burden on the NCLT, so that the liquidation procedure can now be submitted to the central government. This article was written by Candana, who follows B.Com.LLB (Hons) of Tamil Nadu Dr.
Ambedkar Law University (SOEL). This article discusses the Companies (Liquidation) Rules 2020 and their implications for the National Company Law Court. Resolution in Nigeria is primarily governed by the Companies and Related Matters Act Cap. C20, the Laws of the Federation of Nigeria (LFN) 2004 (CAMA), the Winding-up Rules 2001 (WR) and subsidiary legislation. Sectoral requirements may also apply, for example: in accordance with the provisions of the Bank and Other Financial Institutions Act (Chapter B3, LFN 2004) and the Insurance Act, Chapter L14, LFN 2004 (IA). This article attempts to answer some FAQs about treatment in Nigeria. If a winding-up order is issued, a copy of the winding-up order is sent by the corporation (or other prescribed body) to the Common Affairs Committee, which shall prepare in its books minutes of winding-up and keep it in respect of that corporation. 144. Neither the liquidator nor a member of the inspection committee of a partnership, acting as liquidator or a member of such a committee, may become, directly or indirectly, by himself or by an employer, a partner, employee, representative or servant, the purchaser of any part of the assets of the partnership, except with the approval of the court; and any purchase contrary to this rule may be annulled by the Court of Justice at the request of the Ministry in the event of liquidation by the court or by a creditor or contributor in the event of liquidation, and the court may incur such costs as it deems appropriate. 74. In the case of winding-up by the court, each creditor shall, subject to the following provisions, prove his guilt, unless the judge of a particular winding-up orders the admission without proof of each creditor or group of creditors. Companies are created for a variety of reasons, including generating profits and sustaining operations to ensure a return on investment (ROI) for their investors and shareholders in the form of dividends.
However, for various reasons such as non-profitability, bankruptcy, etc., it may become relevant for these companies to cease their activities and cease to exist. This can be done through the settlement process. 2. Where an order has been made under this Division, any application for authorization resulting from that order shall be made at the time of the winding-up of the corporation in respect of which the order was made, and the winding-up of the corporation or the stay of any proceeding in connection with such winding-up shall not preclude such application or the granting of authorization. 8. If a liquidator dies in liquidation by the court, resigns or is removed, another liquidator may be appointed in his place in the same manner as for a first appointment and the trustee of record shall, at the request of at least one-tenth of the value of the creditors or contributors, call meetings: determine whether or not to fill the vacancy; however, nothing in this rule applies if the liquidator is dismissed under section 431 of the Act; In this case, the official receiver remains the liquidator. (c) The notice of the proposed meeting and of the scheduled meeting of the inspection commission shall also be published on form 37 of the annex, with such modifications as may be necessary in the circumstances, at least once in a national newspaper or, if the dissolution does not take place at the seat of the Court, in a newspaper distributed in the district of the court where the proceedings are pending; 89. (1) Subject to the provisions of the Act and unless the court orders otherwise, the liquidator may, for each winding-up, fix from time to time a specific date, which shall be at least thirty days from the date of notification on which the creditors of the company must prove their debts or claims.
and to establish a title that they have priority under section 494 of the Act or that are excluded from a distribution made before the proof of such debts or, as the case may be, to oppose such a distribution. With the appointment of a liquidator, existing contracts do not terminate automatically, unless expressly provided otherwise. Thus, the termination of contractual provisions, retention of title, set-off, valid as assignment/transfer, as a fiduciary clause and other clauses agreed in advance remain valid regardless of liquidation. However, a liquidator may ask the court to reject onerous or unprofitable contracts of the company. However, once the liquidation procedure is completed, all its contracts are terminated, generally without prejudice to liabilities incurred prior to termination.