Dubai Court dissolves company after its capital fully depleted with debts nearly Dhs34 million

The Dubai Commercial Court has ruled to dissolve and liquidate a land transport company after it was confirmed that the company's capital had been fully depleted, with debts surpassing Dhs33.976 million, nearly 34 million. This decision was based on a report from an accounting expert, which highlighted the company's total inability to sustain its operations.

The case originates from a commercial dispute in which one partner filed a lawsuit seeking the dissolution and liquidation of the company. The partner claimed that the company had effectively stopped functioning due to significant financial losses and that its liabilities had surpassed the capital outlined in its articles of incorporation, making it incapable of fulfilling its business purposes.

During the legal proceedings, the court engaged an accounting expert to assess the company's actual financial situation. This involved examining its records and documents, evaluating its assets and liabilities, and determining whether the company was still operational. After completing the analysis, the expert concluded that the company had indeed ceased operations, owned no real estate or movable property, lacked cash reserves, and faced a negative financial standing. It was confirmed that its liabilities outweighed its assets entirely, with accumulated losses eroding all capital.

After reviewing the expert report, the court proceeded to hear the case in open sessions. The plaintiff's representative was present, while the other defendants failed to appear. Consequently, the court delivered a judgment in the presence of those attending, ruling that the company be dissolved and liquidated due to the demonstrated inability to sustain its operations.