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of <h1>Clause 253: Creditors Can Apply to Declare Company Sick if 50% Debt Unpaid in 30 Days</h1> Clause 253 of the Companies Bill, 2011, addresses the determination of a company's sickness. If a company fails to repay or secure a debt demanded by secured creditors representing at least 50% of its outstanding debt within 30 days, creditors can apply to the Tribunal to declare the company sick. Applications can also request a stay on winding-up proceedings or asset execution. The Tribunal must determine sickness within 60 days, ensuring the company has a chance to respond. If deemed practicable, the Tribunal may allow time for debt repayment, with possible restrictions. Government bodies can also refer companies to the Tribunal under specific conditions.
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