1. Winding up — Dissolution of company — Application under Section 481, Companies Act, 1956, by Official Liquidator. (Para 1 , 2 )
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2026 Supreme(Online)(Del) 3848
IN THE HIGH COURT OF DELHI AT NEW DELHI
Anish Dayal, J
Official Liquidator – Appellant
Versus
Shahi Fashions Pvt Ltd – Respondent
CO.PET. 475/2011|CO.APPL. 1287/2015|OLR 38/2025|CRL.O.(CO.) 6/2016|CO.APPL. 102/2026|CO.APPL. 103/2026|CO.APPL. 91/2026
Advocates:
For the Appellants/Petitioners: Ruchi Sindhwani, Megha Bharara
For the Respondents: Ajay Garg, Uday Garg
For the Appellants/Petitioners: Ruchi Sindhwani, Megha Bharara
For the Respondents: Ajay Garg, Uday Garg
A company may be dissolved and the Official Liquidator discharged when the affairs are completely wound up or no further assets are available to realize, effectively ending the winding up process.
Headnote:(A) Company Law - Dissolution of Company - Winding up process - Where the affairs of the company have been completely wound up, or the Official Liquidator cannot proceed due to want of funds or other reasons, the Court is empowered to order the dissolution of the company to end the winding up process. (Para 13, 18)
(B) Company Law - Liquidation - Disbursement of Claims - Procedure for calculating and paying admitted claims and interest to creditors under the Companies (Court) Rules prior to dissolution. (Para 9, 10, 11)
Issues: Whether the company should be dissolved and the Official Liquidator discharged given that all assets were realized and claims satisfied.
Legal Category Hierarchy
- practice and procedure
Table of Contents
2. Ex-directors failed to file Statement of Affairs — Assets sold after petition — Claim admitted — No further assets. (Para 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 )
3. Company completely wound up — No further assets — No useful purpose in continuing proceedings — Dissolution warranted. (Para 13 , 14 , 15 )
4. When affairs are completely wound up or no funds remain, court may order dissolution under Section 481. (Para 13 )
5. Company dissolved — Official Liquidator discharged — Pending applications disposed of — Criminal petition closed. (Para 16 , 17 , 18 , 19 , 1 , 2 , 3 )
6. What is the legal standard for dissolving an insolvent company under Section 481 of the Companies Act, 1956?
When the company's affairs are completely wound up or the Official Liquidator cannot proceed for want of funds, the court may order dissolution. (Para 13 , 14 , 15 )
7. Can a delay in filing an application under Section 481 be condoned?
Yes, the court may condone delay for reasons stated in the application, as done here for a 58-day delay. (Para 1 , 2 )
8. What happens to a related criminal complaint under Section 454 when the company is dissolved?
The criminal petition stands disposed of as no useful purpose would be served by continuing it after dissolution. (Para 1 , 2 , 3 )
9. How should residual funds after liquidation be distributed among creditors?
The company's remaining funds, after deducting liquidation expenses, are disbursed to the admitted creditor towards principal and interest under Rule 179. (Para 9 , 10 , 11 , 12 )
10. What must the court consider before dissolving a company and discharging the Official Liquidator?
The court must be satisfied that no further assets exist and no sum can be realized, making further proceedings futile. (Para 12 , 13 , 14 , 15 )
O R D E R
% 10.02.2026 CO.APPL. 102/2026 (for condonation of delay) in CO.PET. 475/2011
1. The present application has been filed by the Official Liquidator [“OL”] seeking condonation of 58 days delay in filing the application under Section 481 of the Companies Act, 1956.
2. For reasons stated in the application, same is allowed, and the delay of 58 days is condoned.
3. Application stands disposed of.
CO.APPL. 103/2026 (U/S 481 of the Companies Act, 1956) in CO.PET.
475/2011
1. This application has been filed by the Official Liquidator (‘OL’) under Section 481 of the Companies Act, 1956 (‘Companies Act’) praying that Shahi Fashions (P) Ltd. (in liquidation) be dissolved and OL be discharged as its Liquidator.
2. It is stated that by order dated 03rd September 2013, OL was appointed as the Provisional Liquidator of the company, Shahi Fashions (P) Ltd. [hereinafter referred to as “Company (in liqn.)”]. Citations were published in “Statesman” (English), Delhi edition & “Dainik Jagran” (Hindi), Delhi edition on 26th December 2013 and in the “Delhi Gazette on 06th February 2014. Vide order dated 20th March 2014, the company was wound up and OL was appointed as its Liquidator. The citation was published in “Statesman” (English), Delhi edition & “Dainik Jagran”
(Hindi), Delhi edition on 01st May 2014.
3. It is stated in the application that the ex-directors failed to file the Statement of Affairs within the statutory time prescribed under Section 454 of the Companies Act and failed to remove the defects therein; accordingly, a criminal complaint being CRL.O.(CO.) 6/2016 was filed by OL. A separate application has been filed in the said criminal complaint for disposing of the same.
4. It is stated in the present application that, as per the record of the Registrar of Companies (‘ROC’), the registered office of the Company (in liqn.) was situated at G-44, Lawrence Road, Industrial Area, New Delhi. Possession of the said premises could not be taken over as one Mr. Nirmal Ramuka stated that the Company was a tenant and had vacated the premises four years earlier. A letter dated 22nd December 2017 was received from Mr. Nirmal Ramuka along with a copy of title deed in respect to the aforesaid property in favour of Mrs. Ganga Ram Devi, (mother of Mr. Nirmal Ramuka). Therefore, possession of the said property was not taken over by OL.
5. It is further stated in the said application that possession of the immoveable asset of Company (in liqn.) at Plot No. 40, Rai Industrial Estate, Sector-38, Phase-I Rai, Sonepat, Haryana, could not be taken over as the same was sold by the ex-director to one Mr. Dinesh Kumar Mahajan after the filing of the winding up petition. OL filed CO.APPL.1287/2015 seeking setting aside of the sale of the said plot. Subsequently, CO.APPL.603/2019 was filed by Mr. Dinesh Kumar Mahajan, who claimed to be a bona fide purchaser of the plot in question, seeking vacation of the stay order passed by this Court.
6. This Court, vide order dated 14th August 2019, held that the purchaser was bona fide; however, the ex-director was directed to give a detailed Statement of Account along with supporting bank transactions details. Upon receipt of certain documents from the ex-director, the same were examined by OL and an OLR No.7/2023 was filed. Same was considered by this Court and, vide order dated 17th August 2023, the ex- management was directed to deposit a sum of Rs.25,00,000/- with the Registrar General of this Court and Rs.5,00,000/- with the office of OL.
7. The ex-management was further granted a last opportunity to show its bona fides and file an updated account with the OL. Ex-director, Sh. Manoj Ramuka, deposited Rs.25,00,000/- with the Registrar of this Court on 11th September 2023 and a sum of Rs.5,00,000/- with the OL on 15th September 2023.
8. Vide order dated 17th August 2023, the OL was permitted to invite claims from the creditors. Notice inviting claims against the Company (in liqn.), was published in the newspapers namely “T
