{"id":28527,"date":"2020-01-31T11:54:59","date_gmt":"2020-01-31T06:24:59","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=28527"},"modified":"2021-03-27T12:28:47","modified_gmt":"2021-03-27T06:58:47","slug":"mca-simplifies-winding-up-rules-for-small-firms","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/mca-simplifies-winding-up-rules-for-small-firms\/","title":{"rendered":"MCA Simplifies Winding up Rules for Small Firms"},"content":{"rendered":"

The\nMinistry of Corporate Affairs (MCA) on Tuesday notified rules for winding up of\ncompanies.<\/strong><\/p>\n\n\n\n

What does the term\nwinding up suggest?<\/h2>\n\n\n\n

Winding up or liquidation is the process of dissolving a company. In this process, the Company’s assets are collected and sold to pay its debts. A Company can be wound up in two ways. First, the Court can mandatorily wind up a company<\/a>. The second way is known as “voluntary winding up” in which the shareholders or the creditors of the Company can themselves apply to wind up the Company.<\/p>\n\n\n\n

Winding up rules simplified for small firms<\/h2>\n\n\n\n

The rules for winding\nup a business have been simplified for smaller firms as they no longer will\nhave to take approval from Tribunal for liquidation of their Company rather\nCentral Government will give required approvals for winding up.<\/p>\n\n\n\n

Download Rules for Small Firms<\/a><\/div>\n\n\n\n

The rules notified by\nMCA provide summary procedures for liquidation of the following class of\ncompanies based on the latest audited Balance Sheet:<\/strong><\/p>\n\n\n\n

  • The Company which has taken a deposit and total outstanding deposits is not exceeding twenty-five lakh rupees.<\/li>
  • The Company of which the total outstanding loan, including secured loan, does not exceed fifty lakh rupees.<\/li>
  • The Company of which turnover is up to fifty crore rupees.<\/li>
  • The Company of which paid-up capital does not exceed one crore rupees.<\/li><\/ul>\n\n\n\n

    The Central Government\nwill provide the required approvals for winding up to the above-mentioned class\nof companies rather than the Tribunal.<\/p>\n\n\n\n

    The rules notified by\nMCA mandate that the liquidation of Company will be carried out by the official\nliquidator hired by the government. The hired liquidator will take charge of\nthe assets and deal with the claims of the Company. In case the liquidator\nfinds any fraud done by shareholders, directors or any other officials of the\nCompany, the government may order a probe.<\/p>\n\n\n\n

    The Winding-up rules notified by the Ministry of Corporate Affairs will be effective from 1st April 2020<\/strong>. The rules prescribe how official liquidators have to go about managing the resources of the Company that goes into liquidation. The rules mentioned seek to reduce the burden of the NCLT by enabling summary procedures for liquidation to be filed with the Central Government.<\/p>\n","protected":false},"excerpt":{"rendered":"

    The Ministry of Corporate Affairs (MCA) on Tuesday notified rules for winding up of companies. What does the term winding up suggest? Winding up or liquidation is the process of dissolving a company. In this process, the Company’s assets are collected and sold to pay its debts. A Company can be wound up in two […]<\/p>\n","protected":false},"author":26,"featured_media":28529,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2611],"tags":[],"acf":{"service_id":"215"},"yoast_head":"\nMCA Simplifies Winding up Rules for Small Firms - Enterslice<\/title>\n<meta name=\"description\" content=\"Winding up Rules for Small Firms - The Winding-up rules notified by the Ministry of Corporate Affairs will be effective from 1st April 2020.\" \/>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterslice.com\/learning\/mca-simplifies-winding-up-rules-for-small-firms\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"MCA Simplifies Winding up Rules for Small Firms - Enterslice\" \/>\n<meta property=\"og:description\" content=\"Winding up Rules for Small Firms - The Winding-up rules notified by the Ministry of Corporate Affairs will be effective from 1st April 2020.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterslice.com\/learning\/mca-simplifies-winding-up-rules-for-small-firms\/\" \/>\n<meta property=\"og:site_name\" content=\"Enterslice\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/enterslice\" \/>\n<meta property=\"article:published_time\" content=\"2020-01-31T06:24:59+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-03-27T06:58:47+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2020\/01\/Winding-Up-Rules-for-Small-Firms.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"670\" \/>\n\t<meta property=\"og:image:height\" content=\"352\" \/>\n<meta name=\"twitter:card\" content=\"summary\" \/>\n<meta name=\"twitter:creator\" content=\"@enterslice\" \/>\n<meta name=\"twitter:site\" content=\"@enterslice\" \/>\n<!-- \/ Yoast SEO plugin. -->","authorName":"Shubham Chauhan","authorImageUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/10\/IMG_20191011_160437__01.jpg","authorDescription":"A passionate legal content writer, a nature enthusiast, an avid reader, and a part-time thinker. By means of conducting in-depth research on industry related topics, Shubham often builds flawless and intelligible legal content for populace from all walks of life.","postViews":420,"readingTime":2,"nextPost":{"id":28546,"slug":"insolvency-and-bankruptcy-code-now-covers-nbfcs-and-other-fsps"},"prevPost":{"id":28519,"slug":"businesses-need-climate-change-and-sustainability-services"},"featuredMediaUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2020\/01\/Winding-Up-Rules-for-Small-Firms.jpg","postTerms":"MCA Notification","_links":{"self":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/28527"}],"collection":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/users\/26"}],"replies":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/comments?post=28527"}],"version-history":[{"count":0,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/28527\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media\/28529"}],"wp:attachment":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media?parent=28527"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/categories?post=28527"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/tags?post=28527"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}