Insolvency of a company
Ritambhara
(Querist) 16 July 2014
This query is : Resolved
A company was started with four directors, they ran the company for 2-3 years, thereafter, the company started to incur great loss so eventually the company was shut down. There was no legal formality done to wind up the company though the papers are there to show the losses incurred by the company.
Now, during the period company was existing, the same was engaged in a campaign with another company(campaign company) involving an amount of 60 lakhs. After the abrupt shut down of the company three of the directors fled from their rights and liabilities. The fourth director who works in the same area as that of the campaign company cannot jeopardize his business relationship and also he is being continuously contacted by the debt recovery people for recovery of money.
The issue is the fourth director wants to settle this once and for all with least of money( as in less that 10 % of 60 lakhs).what is the best legal stand point to negotiate the matter.
ajay sethi
(Expert) 16 July 2014
director of company can afford legal fees when he is willing to settle with his creditors
Advocate. Arunagiri
(Expert) 16 July 2014
The existing director can move the court for winding up the company.
Please see s.433 a of the Indian companies Act 1956.
Take the help of the advocate.
