A second-hand car dealer has been allowed to liquidate after the proprietor said he was unable to pay debts amounting to Sh48.2 million.
The director of Your Dream Car Ltd Laban Karonji Ndirangu asked the court to liquidate the company saying he was in a deep financial crisis, such that the firm is unable to pay its debts.
He also said he has been arrested on several occasions because of debts and the company was listed with Credit Reference Bureau (CRB) and there was an unlikelihood that it would be resuscitated as a going concern.
Although some creditors opposed the winding-up petition, Justice Dorah Chepkwony allowed the application saying they will have the opportunity to present their claims during the liquidation process.
“That the Official Receiver be and is hereby appointed as the provisional liquidator of Your Dream Car Motor Ltd. The company’s director is precluded from disposing any of assets or property of the company,” the judge said.
Mr Ndirangu said he started the company in November, 2017 to sell second-hand motor vehicles. All was well until 2020 when its business dwindled as a result of Covid-19 pandemic.
He said the debts kept piling up and stood at Sh48.2 million as at March, last year. He asked the court to grant the liquidation order and appoint a liquidator in the interest of justice, so that he could recoup from the loss of business without fear of prosecution.
A number of creditors including Mr Sammy Muthui Mwangi and Dr Simon Njuguna Mburu opposed the petition, saying the director has not disclosed its assets or delivered its audited accounts hence, the case was a mischief meant to swindle the creditors.
Justice Chepkwony said there was no evidence advanced to show the company’s solvent standing and therefore, she does not see a reason not to grant an order of liquidation.