Section 276: Removal and replacement of liquidator
This section is for the removal and replacement of a liquidator by the Tribunal due to various grounds such as misconduct or fraud.
The section, clause by clause
What the section says
In plain terms
(1)The Tribunal may, on a reasonable cause being shown and for reasons to be recorded in writing, remove the provisional liquidator or the Company Liquidator, as the case may be, as liquidator of the company on any of the following grounds, namely:—
The Tribunal can remove a provisional liquidator or Company Liquidator if there is a reasonable cause, such as misconduct, fraud, professional incompetence, or conflict of interest, and the reasons are recorded in writing.
(1)(a)misconduct;
(1)(b)fraud or misfeasance;
(1)(c)professional incompetence or failure to exercise due care and diligence in performance of the powers and functions;
(1)(d)inability to act as provisional liquidator or as the case may be, Company Liquidator;
(1)(e)conflict of interest or lack of independence during the term of his appointment that would justify removal.
(2)In the event of death, resignation or removal of the provisional liquidator or as the case may be, Company Liquidator, the Tribunal may transfer the work assigned to him or it to another Company Liquidator for reasons to be recorded in writing.
If a provisional liquidator or Company Liquidator dies, resigns, or is removed, the Tribunal can transfer their work to another Company Liquidator, recording the reasons in writing.
(3)Where the Tribunal is of the opinion that any liquidator is responsible for causing any loss or damage to the company due to fraud or misfeasance or failure to exercise due care and diligence in the performance of his or its powers and functions, the Tribunal may recover or cause to be recovered such loss or damage from the liquidator and pass such other orders as it may think fit.
The Tribunal can recover losses or damages from a liquidator if they are caused by fraud, misfeasance, or failure to exercise due care, and pass other orders as needed.
(4)The Tribunal shall, before passing any order under this section, provide a reasonable opportunity of being heard to the provisional liquidator or, as the case may be, Company Liquidator.
The Tribunal must give the provisional liquidator or Company Liquidator a reasonable opportunity to be heard before passing any order under this section.
The right-hand column is written from the section text, not quoted from it, and it has no legal force. Where the two differ, the left-hand column is the law.
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Reproduced from the official India Code print for reference. Check the current text on India Code before you rely on it, and read the section alongside its Rules. Nothing here is legal advice.