JY Ko – Successful Application of Winding Up in Kuala Lumpur High Court
Messrs JY Ko is delighted to announce that we have successfully applied and obtained a winding up order at the Kuala Lumpur High Court against a company for a debt for RM 13 million pursuant to sale and delivery of power generators.
Prior to the Winding Up Petition, we have also obtained the Judgment against the Defendant at the Kuala Lumpur High Court with costs granted.
The entire process was fairly smooth and it took us barely three (3) months including the newspapers advertisement of four (4) times and gazette which led to the eventual and successful winding up of the Defendant company.
A company may be wound up by the Court if any of the conditions in Section 465 of the Companies Act 2016 is met, namely, among others:-
(a) the company has by special resolution resolved that the company is to be wound up by the Court;
(b) the company defaults in lodging the statutory declaration under subsection 190(3);
(c) the company does not commence business within a year from its incorporation or suspends its business for a whole year;
(d) the company has no member;
(e) the company is unable to pay its debts;
(f) the directors have acted in the affairs of the company in the directors’ own interests rather than in the interests of the members as a whole or acted in any other manner which appears to be unfair or unjust to members;
(g) when the period, if any, fixed for the duration of the company by the constitution expires or the event, if any, occurs on the occurrence of which the constitution provide that the company is to be dissolved;
(h) the Court is of the opinion that it is just and equitable that the company be wound up;
(i) the company has held a licence under the Financial Services Act 2013 or the Islamic Financial Services Act 2013, and that the licence has been revoked or surrendered;
(j) the company has carried on a licensed business without being duly licensed or the company has accepted, received or taken deposits in Malaysia, in contravention of the Financial Services Act 2013 or the Islamic Financial Services Act 2013, as the case may be;
(k) the company is being used for unlawful purposes or any purpose prejudicial to or incompatible with peace, welfare, security, public interest, public order, good order or morality in Malaysia.
Most of the time, a company is ordered to be wound up by the Court is when the company is unable to pay its debts. Or almost second most commonly, where there is a serious conflict or dispute among the shareholders that the company should be ordered to be wound up on just and equitable basis.
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Disclaimer: The above proposition is subject to actual facts and circumstances and shall never be referred as the actual law without seeking legal advice. Consult us for more information!