A liquidator’s main function is to gather a company’s property and apply the assets in paying the company’s creditors and allocate any excess among the company’s members. Under Section 448, so far as it relates to the winding up of a Company by the Tribunal there shall be an official liquidator who –
(a) may be appointed from a panel of professional firms of Chartered Accountants, advocates Company Secretaries, Cost and Work Accountants or firms having a combination of these professions, which the Central Government constitute for the Tribunal, or
(b) may be a body corporate consisting of such professionals as may be approved by me Central Government from time to time or
(c) may be a whole time or part time officer appointed by the Central Government. The Central Government may also appoint one or more Deputy official liquidators or Assistant official liquidator to assist the official.
The liquidator is lawfully empowered to act on behalf of the company in various capacities. One of the chief functions of many liquidators is to bring and defend lawsuits.
The role of a liquidator is as follows:
- Wind up the affairs of the company;
- Distribute the company’s assets among its creditors equitably; and
- Examine the circumstances before the liquidation and the causes of the company’s failure.