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B Com Exam  >  B Com Test  >  Company Law  >  Test: Concept & Modes - Winding Up - B Com MCQ

Concept & Modes - Winding Up Free MCQ Practice Test with solutions, B Com


MCQ Practice Test & Solutions: Test: Concept & Modes - Winding Up (10 Questions)

You can prepare effectively for B Com Company Law with this dedicated MCQ Practice Test (available with solutions) on the important topic of "Test: Concept & Modes - Winding Up". These 10 questions have been designed by the experts with the latest curriculum of B Com 2026, to help you master the concept.

Test Highlights:

  • - Format: Multiple Choice Questions (MCQ)
  • - Duration: 10 minutes
  • - Number of Questions: 10

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Test: Concept & Modes - Winding Up - Question 1
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When can the Registrar of Companies file a winding up petition without prior approval?

Detailed Solution: Question 1

The Registrar can present a winding up petition without prior approval if the company fails to deliver the statutory report to the Registrar or hold the statutory meeting. However, such a petition cannot be presented before 14 days have passed after the last day on which the statutory meeting should have been held.

Test: Concept & Modes - Winding Up - Question 2
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What is the primary distinction between winding up and dissolution of a company?

Detailed Solution: Question 2

Winding up is the process of administering a company's assets, paying off creditors, and distributing surplus among shareholders before its dissolution. During winding up, the company's legal entity remains intact, and it can be sued in court. Dissolution, on the other hand, marks the end of the company's legal existence, where its name is struck off from the Register of Companies.

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Test: Concept & Modes - Winding Up - Question 3
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What is the consequence of a winding up order in terms of legal proceedings against the company?

Detailed Solution: Question 3

Once a winding up order is made, no new legal proceedings can be initiated against the company without the Court's permission. Additionally, existing legal proceedings may need the Court's approval to proceed further. This provision ensures that the winding up process is not hindered by various lawsuits against the company.

Test: Concept & Modes - Winding Up - Question 4
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In which situation can a company be wound up by the Court based on "just and equitable" grounds?

Detailed Solution: Question 4

"Just and equitable" grounds for winding up can include scenarios where the company's business is being conducted for fraudulent or illegal purposes, or when the business becomes illegal. This may involve cases of misconduct, oppression of minority shareholders, mismanagement, or other situations where the continuation of the company's operations would be unjust or harmful.

Test: Concept & Modes - Winding Up - Question 5
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What is the role of the Official Liquidator in the winding up process?

Detailed Solution: Question 5

The Official Liquidator is appointed by the Court and plays a crucial role in the winding up process. Their main responsibility is to administer the company's property and assets for the benefit of its creditors and members. They collect assets, pay off debts, and distribute any remaining surplus among the members based on their rights.

Test: Concept & Modes - Winding Up - Question 6
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What is the primary purpose of winding up a company?

Detailed Solution: Question 6

Winding up of a company is the process of ending its existence and administering its assets for the benefit of its creditors and members. During this process, a liquidator is appointed to take control of the company, collect its assets, pay its debts, and distribute any surplus among the members according to their rights. Ultimately, the company is dissolved, and its assets are distributed to stakeholders.

Test: Concept & Modes - Winding Up - Question 7
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Under what circumstances can a company be deemed unable to pay its debts?

Detailed Solution: Question 7

A company is considered unable to pay its debts if a creditor, who is owed more than Rs. 500, serves a demand for payment at the company's registered office, and the company neglects to pay, secure, or compound the sum to the creditor's reasonable satisfaction for three weeks after receiving the demand.

Test: Concept & Modes - Winding Up - Question 8
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Under what circumstances can a "contributory" of a company present a petition for winding up?

Detailed Solution: Question 8

A "contributory," which includes those liable to contribute to the company's assets in case of winding up, can present a winding up petition if the number of members has fallen below the statutory limit, the contributory's shares have been registered in their name for at least six months, and the shares have been held or devolved upon them during the 18-month period before the winding up commencement.

Test: Concept & Modes - Winding Up - Question 9
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In which scenario can a winding up order be based on the grounds of "reduction of membership"?

Detailed Solution: Question 9

A winding up order may be issued if the number of members in a public company falls below 7 or in a private company falls below 2. This provision aims to prevent companies with a very limited number of members from continuing to operate.

Test: Concept & Modes - Winding Up - Question 10
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What is the effect of an order for winding up on legal actions against the company?

Detailed Solution: Question 10

After a winding up order is issued, legal actions against the company can proceed only with the Court's permission. This provision prevents unnecessary legal actions that could hinder the winding up process. The Court will consider whether it's appropriate to allow such actions to proceed based on the circumstances and the best interests of all stakeholders.

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About this B Com Practice Test

This test contains 10 MCQs on Concept & Modes - Winding Up with detailed solutions for each question. It is part of the Company Law course on EduRev, designed to align with the current B Com syllabus. Each solution explains not just the correct answer but also gives you an understanding of the topic — not just to attempt the question but also help you prepare for the exam with practice.

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