What is Section 434 of Companies Act?
434. Company when deemed unable to pay its debts. (c) if it is proved to the satisfaction of the Court that the company is unable to pay its debts, and, in determining whether a company is unable to pay its debts, the Court shall take into account the contingent and prospective liabilities of the company.
What are the grounds under Section 433 of Companies Act?
Section 433(e) of the Companies Act, 1956 provides that in cases where the company is unable to pay its debts the court can order winding up. The expression ‘unable to pay its debts’ has to be taken in the commercial sense of being unable to meet current demands though the company may be otherwise solvent6.
Which companies act was repeated by the present Companies Act 1956?
Chartered Accountants Act, 1949.
Which section of the Companies Act lays down that a company is a subsidiary company or not?
Section 19 of Companies Act, 2013, part of chapter II, lays down the provision which states that subsidiary companies cannot hold shares in its holding company. Companies Act, 2013 defines in relation to one of more other companies, a holding company to be a company of which such companies are subsidiary companies [1].
What happens if a company Cannot pay its debts?
If a corporation stops making debt payments as required or stops communicating with creditors, a corporation’s creditors may sue to collect the amount owed. The balance owed for an unpaid debt is often increased to include unpaid interest, collection costs and attorney fees in the civil judgment.
Is appointed for the process of liquidation?
The liquidator is appointed for handling the liquidation process. Their main role and responsibility are to manage all the activities, accounts, assets, etc. of the company and to liquidate all these as per dues that need to be paid to the creditors.
Is Companies Act 1965 still applicable?
With the coming into force of the new Act, the Companies Act 1965 (“CA 1965”) has been repealed. …
What is Section 185 of Companies Act?
Section 185 (as amended by the Companies (Amendment) Act, 2017): Limits the prohibition on loans, advances, etc. to Directors of the company or its holding company or any partner of such Director or any partner of such Director or any firm in which such Director or relative is a partner.
What happens if a company is sued and can’t pay?
The lawsuit is not based on whether you can pay—it is based on whether you owe the specific debt amount to that particular plaintiff. Even if you have no money, the court can decide: the creditor has won the lawsuit, and, you still owe that sum of money to that person or company.
Can I lose my house if my limited company goes bust?
When the time comes around, if you cannot repay or if your company goes bust, then the creditors will come to you for repayment. You will be held personally liable. If you have not got the capital funds then your home and any other personal belongings may be at risk should you be made bankrupt.