What is Disclaimer of onerous property Is Transfers, etc., after commencement of winding up to be void Section 333 and 334 of Indian Companies Act 2013

Disclaimer of onerous property and Transfers, etc., after commencement of winding up to be void are defined under Section 333  and 334 of Indian Companies Act 2013. Provisions under these Sections are:

Section 333 of Indian Companies Act 2013 "Disclaimer of onerous property"

(1) Where any part of the property of a company which is being wound up consists of -

(a) land of any tenure, burdened with onerous covenants;

(b) shares or stocks in companies;

(c) any other property which is not saleable or is not readily saleable by reason of the possessor thereof being bound either to the performance of any onerous act or to the payment of any sum of money; or
(d) unprofitable contracts,

the Company Liquidator may, notwithstanding that he has endeavoured to sell or has taken possession of the property or exercised any act of ownership in relation thereto or done anything in pursuance of the contract, with the leave of the Tribunal and subject to the provisions of this section, by writing signed by him, at any time within twelve months after the commencement of the winding up or such extended period as may be allowed by the Tribunal, disclaim the property:

Provided that where the Company Liquidator had not become aware of the existence of any such property within one month from the commencement of the winding up, the power of disclaiming the property may be exercised at any time within twelve months after he has become aware thereof or such extended period as may be allowed by the Tribunal.

(2) The disclaimer shall operate to determine, as from the date of disclaimer, the rights, interest and liabilities of the company in or in respect of the property disclaimed, but shall not, except so far as is necessary for the purpose of releasing the company and the property of the company from liability, affect the rights, interest or liabilities of any other person.

(3) The Tribunal, before or on granting leave to disclaim, may require such notices to be given to persons interested, and impose such terms as a condition of granting leave, and make such other order in the matter as the Tribunal considers just and proper.

(4) The Company Liquidator shall not be entitled to disclaim any property in any case where an application in writing has been made to him by any person interested in the property requiring him to decide whether he will or will not disclaim and the Company Liquidator has not, within a period of twenty-eight days after the receipt of the application or such extended period as may be allowed by the Tribunal, give notice to the applicant that he intends to apply to the Tribunal for leave to disclaim, and in case the property is under a contract, if the Company Liquidator after such an application as aforesaid does not within the said period or extended period disclaim the contract, he shall be deemed to have adopted it.

(5) The Tribunal may, on the application of any person who is, as against the Company Liquidator, entitled to the benefit or subject to the burden of a contract made with the company, make an order rescinding the contract on such terms as to payment by or to either party of damages for the non-performance of the contract, or otherwise as the Tribunal considers just and proper, and any damages payable under the order to any such person may be proved by him as a debt in the winding up.

(6) The Tribunal may, on an application by any person who either claims any interest in any disclaimed property or is under any liability not discharged under this Act in respect of any disclaimed property, and after hearing any such persons as it thinks fit, make an order for the vesting of the property in, or the delivery of the property to, any person entitled thereto or to whom it may seem just that the property should be delivered by way of compensation for such liability as aforesaid, or a trustee for him, and on such terms as the Tribunal considers just and proper, and on any such vesting order being made, the property comprised therein shall vest accordingly in the person named therein in that behalf without any conveyance or assignment for the purpose:

Provided that where the property disclaimed is of a leasehold nature, the Tribunal shall not make a vesting order in favour of any person claiming under the company, whether as under-lessee or as mortgagee or holder of a charge by way of demise, except upon the terms of making that person -

(a) subject to the same liabilities and obligations as those to which the company was subject under the lease in respect of the property at the commencement of the winding up; or

(b) if the Tribunal thinks fit, subject only to the same liabilities and obligations as if the lease had been assigned to that person at that date, and in either event as if the lease had comprised only the property comprised in the vesting order, and any mortgagee or under-lessee declining to accept a vesting order upon such terms shall be excluded from all interest in, and security upon the property, and, if there is no person claiming under the company who is willing to accept an order upon such terms, the Tribunal shall have power to vest the estate and interest of the company in the property in any person liable, either personally or in a representative character, and either alone or jointly with the company, to perform the covenants of the lessee in the lease, free and discharged from all estates, encumbrances and interests created therein by the company.

(7) Any person affected by the operation of a disclaimer under this section shall be deemed to be a creditor of the company to the amount of the compensation or damages payable in respect of such effect, and may accordingly prove the amount as a debt in the winding up.

Section 334 of Indian Companies Act 2013 "Transfers, etc., after commencement of winding up to be void"

(1) In the case of a voluntary winding up, any transfer of shares in the company, not being a transfer made to or with the sanction of the Company Liquidator, and any alteration in the status of the members of the company, made after the commencement of the winding up, shall be void.

(2) In the case of a winding up by the Tribunal, any disposition of the property, including actionable claims, of the company, and any transfer of shares in the company or alteration in the status of its members, made after the commencement of the winding up, shall, unless the Tribunal otherwise orders, be void.

 

What is Arrangement when binding on company and creditors What is Power to apply to Tribunal to have questions determined, etc Section 321 and 322 of Indian Companies Act 2013

What is Costs of voluntary winding up Is Debts of all descriptions to be admitted to proofSection 323 and 324 of Indian Companies Act 2013

What is Application of insolvency rules in winding up of insolvent companies What is Overriding preferential payments Section 325 and 326 of Indian Companies Act 2013

What is Preferential payments What is Fraudulent preference Section 327 and 328 of Indian Companies Act 2013

What is Transfers not in good faith to be void Certain transfers to be void. Section 329 and 330 of Indian Companies Act 2013

What is Liabilities and rights of certain persons fraudulently preferred What is effect of floating charge Section 331 and 332 of Indian Companies Act 2013

What is Disclaimer of onerous property Is Transfers, etc., after commencement of winding up to be void Section 333 and 334 of Indian Companies Act 2013

What is certain attachments, executions, etc., in winding up by Tribunal to be void What are Offences by officers of companies in liquidation Section 335 and 336 of Indian Companies Act 2013

What is Penalty for frauds by officers What is Liability where proper accounts not kept Section 337 and 338 of Indian Companies Act 2013

What is Liability for fraudulent conduct of business What is Power of Tribunal to assess damages against delinquent directors, etc Section 339 and 340 of Indian Companies Act 2013

 

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