Page 353 - DMGT407Corporate and Business Laws

Corporate and Business Laws

Notes 2. If the registrar does not within one month of sending the letter receive any answer thereto,
he shall, within 14 days after expiry of the month, send to the company by post a registered
letter referring to the first letter and stating that no answer thereto has been received and
that, if an answer is not received to the second letter within one month from the date
thereof, a notice will be published in the official gazette, with a view to striking the name
of the company off the register.
3. If the registrar either receives an answer from the company to the effect that it is not
carrying on business or is not in operation, or does not within one month after sending the
second letter receive any answer, he may publish in the official gazette and send to the
company by registered post a notice that, at the expiration of 3 months from the date of
that notice, the name of the company, unless cause is shown the contrary, be struck off the
register and the company will be dissolved.
The dissolution of the company in the above stated manner, shall not, however, affect: (a) The
liability, if any, of every director, manager or other officer who was exercising any power of
management and of every member of the company. In other words, such persons shall be liable
as if the company had not been dissolved; and (b) the power of the court to wind up a company.
Restoration of the Name of the Company

If a company or any member or any creditor feels aggrieved by the removal of the company’s
name from the register of companies, the court may, on an application by the aggrieved party,
any time within 20 years from the publication in the official gazette of the notice of striking off
the name of the company, order that the name of the company should be restored in the register.
Power of the court to order for restoration of company’s name is discretionary and will be given
when the court is satisfied that: (1) after restoration, the company will be in a position to carry
on its business; or (2) at the time of striking off, the company was carrying on business or was in
operation; or (3) it is just and equitable that the company’s name be restored.
The court may also, on passing such an order, give such directions and make such provisions as
seem just for placing the company and all other persons in the same position, as nearly as may
be, as if the name of the company had not been struck off.
A certified copy of the court’s order must be delivered to the registrar and upon such delivery the
company shall be deemed to have continued in existence as if its name had not been struck off.

Dissolution in Pursuance of Amalgamation [s.394(1)]

The court may, either by the order sanctioning the compromise or arrangement or by a subsequent
order, make provision for the dissolution, without winding up, of the company whose
undertaking, property or liabilities, either wholly or in part, under the scheme of amalgamation
or construction, is transferred to another company.
But no such order shall be made by the court unless the official liquidators has, on scrutiny of the
books and papers of the company, made report to the court that, the affairs of the company have
not been conducted in a manner prejudicial to the interest of its members or to public interest.
The court can, however, within 2 years declare the dissolution void.

Dissolution in Pursuance of Winding up

The corporate existence of a company continues through winding up till it is dissolved. It may
be dissolved as follows:

1. In case of compulsory winding up (s.481): The court will make an order dissolving a
company if: (i) the affairs of the company have been completely wound up (i.e. assets

346 LOVELY PROFESSIONAL UNIVERSITY