Sections 293 and 294 of the Companies Act, 2013: Company Liquidator Books and Audit
Sections 293 and 294 form part of Chapter XX of the Companies Act, 2013 dealing with winding up. They prescribe record-keeping, accounting, audit and inspection requirements for a Company Liquidator appointed in a winding up by the Tribunal.
Updated for the current Companies Act framework and the Companies (Winding Up) Rules, 2020.
Section 293 - Books to be kept by Company Liquidator
What Section 293 provides: The section requires the Company Liquidator to maintain proper books in the prescribed manner. These records are intended to provide an accountable record of proceedings and other prescribed matters during the winding-up process.
Sub-section (1): The Company Liquidator must keep proper books in the prescribed manner and cause entries or minutes to be made concerning proceedings at meetings and other prescribed matters.
Sub-section (2): A creditor or contributory may, subject to the control of the Tribunal, inspect those books personally or through an agent.
The expression Company Liquidator is defined in Section 2(23) of the Companies Act, 2013 as a person appointed by the Tribunal in accordance with Section 275 for winding up a company under the Act.
Section 294 - Audit of Company Liquidator's accounts
What Section 294 provides: This section governs the Company Liquidator's books of account, periodic presentation of receipts and payments, audit by or under the authority of the Tribunal, filing and inspection of audited accounts, and circulation of audited accounts or a summary.
Sub-section (1): The Company Liquidator must maintain proper and regular books of account, including accounts of receipts and payments, in the prescribed form and manner.
Sub-section (2): At prescribed times, but not less than twice each year during the liquidator's tenure, an account of receipts and payments must be presented to the Tribunal in duplicate in the prescribed form and verified by the prescribed declaration.
Sub-section (3): The Tribunal causes the accounts to be audited in the manner it considers fit. The Company Liquidator must provide vouchers and information required for audit, and the Tribunal may require production and inspection of the books of account.
Sub-section (4): After audit, one copy is filed by the Company Liquidator with the Tribunal and another is delivered to the Registrar. The Registrar's copy is open to inspection by creditors, contributories and other interested persons.
Sub-section (5): For a Government company, the prescribed audited account must also be forwarded to the Central Government, the relevant State Government, or both, depending on their membership in the company.
Sub-section (6): The Company Liquidator must cause the audited accounts, or a summary, to be printed and send a printed copy to every creditor and contributory, unless the Tribunal dispenses with compliance in an appropriate case.
Practical meaning and compliance
Sections 293 and 294 operate as transparency and accountability provisions in a Tribunal winding up. Section 293 focuses on the liquidator's books and the qualified inspection right of creditors and contributories. Section 294 focuses on financial accounting, periodic reporting, audit, filing, inspection and circulation of accounts.
The procedural details are supplemented by the Companies (Winding Up) Rules, 2020, which came into force on 1 April 2020 and apply to winding up under the Companies Act, 2013. For an actual winding-up proceeding, the Act, the applicable Rules, Tribunal directions and current notifications should be read together.
Official legal resources
For the latest statutory text and regulatory material, refer to the official India Code - Companies Act, 2013, the Ministry of Corporate Affairs - Companies Act, 2013, and the Companies (Winding Up) Rules, 2020.