|Increase In Authorised Capital
A company may need to increase its authorised share capital before issuing new equity shares andincreasing paid-up capital. Authorised share capital is the total value of shares a company can issue, while paid-up capital is the total value ofshares the company has issued.
Procedure for Increase in Authorize share Capital:-
- Authorisation in Article is must for Increase
- Calling of Board Meeting:
- Issue Notice of the Extra-ordinary General meeting (EGM)
- Holding of General Meeting:
- ROC Form filing:
- Notice to be given to Registrar for alteration of share capital.
|Due Diligence of Company
‘Due diligence’ is an outlook in to the affairs of acompany prior to its acquisition, disposal, refinancing, restructure or other similar transaction. It is sent as an internal memo to members of the executive team who are evaluating the transaction and is a requirement for closing the deal
PROCESS OF DUE DILIGENCE
- UNDERSTAND COMPLIANCE CONCERNS
- DEFINE CORPORATE OBJECTIVES FOR DUE DILIGENCE
- GATHER KEY INFORMATION
- SCREEN PROSPECTIVE THIRD PARTIES AGAINST WATCHLISTS
- CONDUCT A RISK ASSESSMENT
- VALIDATE THE INFORMATION COLLECTED
- RECORD THE DUE-DILIGENCE PROCESS
- ESTABLISH AN ON-GOING MONITORING PLAN
|Winding up/Closing of Company
“The liquidation or winding up of a company is the process whereby its life is ended and its property is administered for the benefit of its creditors and members.
The procedure of Winding up of a company:-
- As per Companies Act 2013, a company can be wound up by a Tribunal, if:
- It is unable to pay its debts.
- The company has by special resolution resolved that the company be wound up by the Tribunal.
- It has acted against the interest of the sovereignty and integrity of India, the security of the State, friendly relations with foreign states, public order, decency or morality.
- The Tribunal has ordered the winding up of the company under Chapter XIX.
- If the company has not filed financial statements or annual returns for the preceding five consecutive financial years.
- If the Tribunal is of the opinion that it is just and equitable that be company should be wound up.
- If the affairs of the company have been conducted in a fraudulent manner or the company was formed for fraudulent and unlawful purposes or the persons concerned in the formation or management of its affairs have been guilty of fraud or misconduct.
|Winding up/Closing of LLP
Winding up is a process, where all the assets of the business are disposed of by the LLP liquidator to meet the liabilities of the LLP.
MODES OF WINDING UP OF LLP:
- Voluntary Winding up
- Insolvency and Bankruptcy Code (IBC), 2016:
- Compulsory winding up
STEPS INVOLVED IN THE PROCESS OF VOLUNTARY LIQUIDATION
- Commencement of Liquidation
- Obtaining declaration of solvency (DOS)
- Declaration to be accompanied with documents
- Passing of resolution
- Approval of voluntary winding up by the creditors
- Notification to the Registrar and IBBI.
- Commencement of liquidation proceedings
- Appointment and Remuneration of Liquidator.
- Preliminary Report;
- Annual Status Report;
- Minutes of consultations with stakeholders; and
- Final Report
- Public Announcement by the Liquidator
- Form and time of announcement.
- Contents of announcement.
- Mode of publishing of announcement.
- Verification of Claims.
either admit or reject the claim, wholly or partially, as the case may be.
- Realization of Assets.
- Deposit and Distribution of Proceeds of Liquidation
Four Reasons Why LLP Winding-Up is Required?
- To avoid compliance and filing responsibilities for the LLP’s which are not active.
- To avoid fines and penalty for late filing, it is better to officially Wind Up LLP’s which are inactive.
- When compared to maintaining compliance for Dormant LLP, it might actually be cheaper to Wind Up and incorporate again when the time is right.
- It makes easy for inactive LLP’s that have NIL assets and liabilities to close down or Wind Up.