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Sir i want to clarify a doubt
Kaplan text states that in COMPULSORY WINDING
All actions for recovery of debt against the company by the creditors of company stops
sir does this mean that the creditor cannot enforce any charge or security over the assets of the company while in compulsory winding up??That is correct. It is now in the liquidator’s control to determine the validity (or invalidity) of any claimed rights over the company’s assets.
In addition, if this were not the case, the creditors that forced their claims would then likely be paid in advance of other creditors that (maybe) couldn’t afford to pursue their claim in Court. That would then lead to a fraudulent preference to the disadvantage of those non-pressing claimants.
OK?
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