Review of Joint Venture Agreement

• The first step is to review the JV agreement for any exit, termination, or winding-up clauses.
  
• It may specify conditions such as mutual consent, project completion, or breach of terms.
  
• Clauses may outline the procedure, notice period, and asset distribution method.
  
• If one partner triggers the clause, the others must comply as per the agreed terms.
  
• Legal advisors must verify that the agreement does not conflict with corporate laws.
  

Board and Shareholder Approval

• A board meeting is convened to propose the winding up of the JV.
  
• A resolution is passed to initiate the dissolution process.
  
• Shareholders must approve the resolution through a general meeting.
  
• Special resolutions are required under the Companies Act, 2013 in India.
  
• All decisions and meeting minutes must be properly documented.
  

Settlement of Liabilities and Obligations

• The JV must pay off outstanding debts, salaries, and statutory dues.
  
• Contracts must be closed, terminated, or assigned as applicable.
  
• Assets must be sold or transferred, and proceeds used to clear liabilities.
  
• The remaining assets are distributed among shareholders based on the shareholding ratio.
  
• Tax and accounting records must be updated and reconciled.
  

Regulatory Filings and Approvals

• In case of voluntary winding up, the company must file Form MGT-14 and GNL-2 with the RoC.
  
• Form STK-2 is used for striking off the company if it qualifies under the Fast Track Exit mode.
  
• A declaration of solvency and indemnity bonds from directors may be required.
  
• Clearances from income tax, GST, and other departments must be obtained.
  
• In cross-border JVs, RBI approval may be required for the repatriation of funds.
  

Appointment of Liquidator (if applicable)

• For a formal liquidation process, a registered liquidator is appointed.
  
• The liquidator takes charge of asset realization and liability settlement.
  
• Reports on assets, claims, and distributions are submitted to the Tribunal or RoC.
  
• The process is supervised by the National Company Law Tribunal (NCLT) in certain cases.
  
• Upon completion, the liquidator files the final report for dissolution.
  

Dissolution and Closure

• Once liabilities are settled and regulatory approvals obtained, the final filing is made.
  
• The company is officially dissolved, and its name is struck off from the Registrar of Companies.
  
• A dissolution certificate is issued as legal proof of closure.
  
• Post-dissolution, no business activity can be carried out in the company’s name.
  
• Records must be preserved as per statutory time limits for audits or investigations.