A private limited company demands to be windup or to be closed, meantime, there is no changes in the business or the Directors of the private limited company, and is not willing to continue their business operations. Any private limited company can wind up both 'voluntary' and 'compulsory elements'. Winding up of a company is a perusal that involves dickering all the properties, assets, paying off all the loans and debts, paying all bankers and distributing the remaining properties or assets to the shareholders of the private limited company. However, it is always challenging to form a business or a company.

For winding up small businesses without having to go to a tribunal, the Ministry of Corporate Affairs has notified the rules 2020, as per the provision in the Companies Act which provides an alternative to the normally used liquidation procedure as per India’s bankruptcy code. The scope of Company Law in India is extensive and unrestricted; it takes into account the depth of winding up of a company and liquidation of its properties and assets. During the period of 'winding up of Private Limited company Online' if its members fail to comply with the rules and regulation, they can get held criminally or civilly liable.

A summary procedure for winding up of companies is conducted as per section 361 of the Companies Act, 2013. The liquidation process is carried out by an Official Liquidator prescribed by the Central Government.