On hearing a winding-up petition the court may dismiss it, or adjourn the hearing conditionally or unconditionally, or make any interim order, or any other order that it thinks fit. However, the court shall not refuse to make a winding up order on the grounds that the assets of the company have been charged or mortgaged to an amount equal or in excess of those assets, or that the company has no assets.
Where the petition is presented by members of the company as contributors on the grounds that it is just and equitable that the company should be wound up, the court shall make a winding up order if it is of opinion that:
(i) the petitioners are entitled to relief either by winding up the company or by some other means; and
(ii) in the absence of any other remedy it would be just and equitable that the company should be wound up.
However, the court may decide against the winding up order if it is also of the opinion that some other remedy is available to the petitioners and that they are acting unreasonably in seeking to have the company wound up instead of pursuing that other remedy.
Where the petition is presented on the ground of default in delivering the statutory report to the registrar or in holding the statutory meeting, the court may:
(i) instead of making a winding up order, direct that the statutory report shall be delivered or that a meeting shall be held; and
(ii) order the costs to be paid by any persons who, in the opinion of the court, are responsible for the default.
The Act further provides that at any time after the presentation of a winding-up petition, and before a winding-up order has been made, the company, or any creditor or contributory may:
(i) where any action or proceeding against the company is pending in any District Court or the Supreme Court, apply to the court in which the action or proceeding is pending for a stay of proceedings herein; and
(ii) where any other action or proceeding is pending against the company, apply to the court having jurisdiction to wind up the company to restrain further proceedings and the court to which application is so made may, as the case may be, stay or restrain the proceedings accordingly on such terms as it thinks fit (Art. 215).
In a winding up by the court, any disposition of the property of the company, including things in action, and any transfer of shares, or alteration in the status of the members of the company made after the commencement of the winding up shall, unless the court otherwise orders, be void (Art. 216).
Additionally any attachment, sequestration, distress or execution put in force against the estate or effects of the company after the commencement of the winding up shall be void to all intents (Art. 217). The winding up of a company by the court shall be deemed to commence at the time of the presentation of the petition for the winding up except where, before the presentation of a petition for the winding up of a company by the court, a resolution has been passed by the company for voluntary winding up. In this case, the winding up of the company shall be deemed to have commenced at the time of the passing of the resolution, and unless the Court, on proof of fraud or mistake thinks fit otherwise to direct, all proceedings taken in a voluntary winding up shall be deemed to have been validly taken (Art. 218).
On the making of a winding-up-order, a copy of the order must be forwarded by the company to the registrar of companies who shall make a note relating to the company in his books (Art. 219). When a winding up order has been made or a provisional liquidator has been appointed, no action or proceeding shall be commenced against the company except by leave of the court and subject to such terms as the court may impose (Art. 220).
An order for winding up a company shall operate in favor of all the creditors and contributors of the company as if made on the joint petition of a creditor and a contributory (Art. 221). The role of the official receiver and registrar of
companies in the winding up procedure is defined under sections 222 and 223 of the Act where it is stated that “the term official receiver” means the official receiver and registrar of companies and includes any other person appointed for the purpose by the Council of Ministers.
Further, the Act provides that the official receiver may apply to the court and request the appointment of any person to act as official receiver in a winding up case under the directions of the official receiver and registrar.
Where the court has made a winding-up order or appointed a provisional liquidator, there shall, unless the court thinks fit to order otherwise and so orders, be made out and submitted to the official receiver a statement of affairs of the company in the prescribed form, verified by affidavit. This should show the particulars of its assets, debts and liabilities; the names, residences and occupations of its creditors; the securities held by them respectively; the dates when the securities were respectively given; and such other information as may be prescribed or as the official receiver may require.