40. Insolvency or liquidation a bar to winding up proceedings.
- Notwithstanding anything contained in Sections 38 of 39, no petition for the winding up of a chit shall be entertained by a court if proceedings under the law relating to insolvency for the time being in force are pending against the foreman for adjudicating him an insolvent or when the foreman is a company, if proceedings for winding up the company are pending against such company in a court.
