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Section 376: Power to wind up foreign companies, although dissolved

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Section 375 All 470 Sections of Companies Act Section 377
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Legal Commentary & Landmark Judgments: Section 376

Section 376 of the Companies Act, 2013 confers jurisdiction on Indian tribunals to wind up foreign companies that have carried on business in India as unregistered companies, even if already dissolved or terminated under their domestic home laws.

  • Foreign Body Corporate Nexus: Applies to any body corporate incorporated outside India that has carried on business in India and subsequently ceases to carry on business within Indian territory.
  • Winding Up Post-Dissolution: The entity may be wound up as an unregistered company under Chapter XXI notwithstanding that it has been dissolved or ceased to exist under the laws of its country of incorporation.
  • Administration of Indian Assets: Creates a statutory mechanism for liquidating domestic assets, recovering local claims, and distributing proceeds to Indian and foreign creditors rateably.
Key Landmark Precedents:
  • Dahanukar v. Ardeshir Hormusji Bhiwandiwalla & Co., AIR 1962 Bom 259: The Division Bench held that Indian courts possess complete territorial and statutory jurisdiction under Section 584 of the 1956 Act (now Section 376) to wind up a dissolved foreign company to administer its Indian assets for the benefit of creditors.
  • Banque des Marchands de Moscou (Koupetschesky) v. Kindersley, [1951] Ch 112: The Court of Appeal held that winding up of a dissolved foreign company creates a statutory trust over local assets, allowing creditors to establish claims despite the foreign entity's corporate death.
  • Re: Tovarishestvo Manufactur Liudvig-Rabenek, [1944] Ch 284: The Chancery Division held that an English court had jurisdiction to wind up a dissolved Russian company where directors had conducted hotel negotiations in London, establishing sufficient business presence.
Courtroom Practice & Strategic Litigation Guidance:

When petitioning under Section 376 against a dissolved multinational corporation, file documentary evidence demonstrating that the foreign entity conducted commercial transactions, maintained bank accounts, or held immovable properties within India. Plead that despite extraterritorial dissolution, Indian assets constitute a statutory trust for satisfying local creditor claims.

Section 375 All 470 Sections of Companies Act Section 377