Companies Act Section 298 — Power to order costs

Summary

If a company being wound up does not have enough assets to pay off all its debts, the Tribunal can decide how the costs, charges, and expenses of the winding-up process itself will be paid from those assets. The Tribunal has the power to set the order of priority among these costs, charges, and expenses, choosing what it considers to be just and proper.

Official Text

The Tribunal may, in the event of the assets of a company being insufficient to satisfy its liabilities, make an order for the payment out of the assets, of the costs, charges and expenses incurred in the winding up, in such order of priority inter se as the Tribunal thinks just and proper.

Related Judgments

• RAGHUNATH RAI BAREJA AND ANR. vs PUNJAB NATIONAL BANK AND ORS — Supreme Court of India (2006)
• STRAW PRODUCTS LTD. vs INCOME-TAX OFFICER, BHOPAL & ORS — Supreme Court of India (1967)
• Universal Music India Pvt. Ltd. vs 1. Mohd. Farooque Azam., 2. State of Maharashtra — Bombay High Court (Mumbai Principal Seat) (2008)
• AFZAL ULLAH vs THE STATE OF UTTAR PRADESH — Supreme Court of India (1963)