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Section 45 of The State Financial Corporations Act, 1951 in hindi

Liquidation of Financial Corporation.

No provision of law relating to the winding up of companies or corporations shall apply to the Financial Corporation, and the Financial Corporation shall not be placed in liquidation, save by order of the State Government and in such manner as it may direct.

Summary

General laws regarding the winding up (closing down) of companies or corporations do not apply to the Financial Corporation.
A Financial Corporation cannot be put into liquidation (the process of liquidating assets and closing a business) by normal corporate or insolvency procedures.
The only authority that can order the liquidation of a Financial Corporation is the State Government.
The liquidation must be carried out in such manner as the State Government may direct.

Practical examples

1In 2026, when a group of creditors tried to file a standard company winding-up petition in court against a struggling State Financial Corporation, the court rejected the petition because under Section 45, standard company liquidation laws do not apply.

2The State Government decided on November 5, 2027, that the State Financial Corporation had completed its purpose and should close. The State Government issued a specific order outlining exactly how the assets would be distributed and how the corporation would be dissolved, as required by Section 45.

FAQ

1. Can a creditor of the Financial Corporation file a court petition to wind it up?

No, standard laws for winding up companies do not apply, and creditors cannot force the Financial Corporation into liquidation through court.

2. Who has the power to place a Financial Corporation in liquidation?

Only the State Government has the legal power to place the Financial Corporation in liquidation.

3. How is the liquidation of the Financial Corporation carried out?

It is carried out in the specific manner directed by the State Government in its liquidation order.

Test yourself

1.Under Section 45 of The State Financial Corporations Act, 1951, which authority has the sole power to order the liquidation of a Financial Corporation?

2.Under Section 45 of The State Financial Corporations Act, 1951, which of the following statements is correct regarding corporate insolvency and winding-up laws?

3.Under Section 45 of The State Financial Corporations Act, 1951, how must the liquidation of a Financial Corporation be conducted once ordered?

4.Under Section 45 of The State Financial Corporations Act, 1951, can a Financial Corporation be dissolved or wound up by a resolution passed by its shareholders?

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