ABSTRACT

Winding up of a company might be required because of various reasons including conclusion of business, misfortune, bankruptcy, passing endlessly of promoters, and so forth., The methodology for winding up of a company can be initiated intentionally by the shareholders or creditors or by a Tribunal. In this article, we take a gander at the methodology for winding up of a company deliberately. On introduction of the winding up application, the court in the wake of hearing the request of has the ability to either expel it or to make an interim request as it thinks suitable. It can even appoint the temporary liquidator of the company till the passing of winding up arrange. It can even appoint the temporary liquidator of the company till the passing of winding up arrange. It might even make a request for winding up with or without cost. It is a procedure by which the properties of the company are directed for the advantage of its members and creditors. The individual designated for directing the advantages and liabilities is called Liquidator.

 CHAPTER 1

                    GENERAL INTRODUCTION

• BACKGROUND TO THE STUDY

Liquidation is the process in accounting by which a company is brought to an end in Cameroon. The assets and property of the company are redistributed. Liquidation is also sometimes referred to as winding-up or dissolution, although dissolution technically refers to the last stage of liquidation. The process of liquidation also arises when customs, an authority or agency in a country responsible for collecting and safeguarding customs duties, determines the final computation or ascertainment of the duties or drawback accruing on an entry. 

Liquidation may either be compulsory (sometimes referred to as a creditors’ liquidation following bankruptcy, which may result in the court creating a “liquidation trust”) or voluntary (sometimes referred to as a shareholders’ liquidation, although some voluntary liquidations are controlled by the creditors).

The term “liquidation” is also sometimes used informally to describe a company seeking to divest of some of its assets. For instance, a retail chain may wish to close some of its stores. For efficiency’s sake, it will often sell these at a discount to a company specializing in real estate liquidation instead of becoming involved in an area it may lack sufficient expertise in to operate with maximum profitability.

The parties which are entitled by law to petition for the compulsory liquidation of a company vary from jurisdiction to jurisdiction, but generally, a petition may be lodged with the court for the compulsory liquidation of a company by:

• The company itself
• Any creditorwhich establishes a prima facie case
• Contributories: Those shareholders be required to contribute to the company’s assets on liquidation
• A minister, usually the one responsible for competition and business
• An official receiver