Question

In case of creditor's voluntary winding up, the liquidators are appointed by __________.

• A. Members
• B. Creditors
• C. Both (A) and (B)
• D. Court

Answer 1

Answer: (C)

Both (A) and (B)

Voluntary winding up is the process in which a company is unable to carry out it operations or the period for carrying the operations expires or if it is unable to meet its financial obligations. It can carry this process either by passing special resolution or by ordinary resolution. There are two kinds of voluntary winding up. They are;

1. Member's voluntary winding up.
2. Creditors voluntary winding up.

Under creditors voluntary winding up declaration of solvency is not required because the company first only becomes unable to pay the liabilities. Under this, the copy of the resolution is sent to the registrar within 10 days. The liquidators are appointed by the members as well as the members of the company.