Section 319 The Companies Act, 2013

Section 319 The Companies Act, 2013

Power of Company Liquidator to Accept Shares, etc., as Consideration for Sale of Property of Company

Omitted]

Amendment

1. (a) Omitted by Insolvency and Bankruptcy Code, 2016 Dated 15th November, 2016. – Original Content

(b) The MCA Notification No. F.O. 3453(E) Dated 15th November, 2016, enforcing the related sections of Insolvency and Bankruptcy Code, 2016.

Original Omitted Content– 319. (1) Where a company (the transferor company) is proposed to be, or is in the course of being, wound up voluntarily and the whole or any part of its business or property is proposed to be transferred or sold to another company (the transferee company), the Company Liquidator of the transferor company may, with the sanction of a special resolution of the company conferring on him either a general authority or an authority in respect of any particular arrangement,–

(a) receive, by way of compensation wholly or in part for the transfer or sale of shares, policies, or other like interest in the transferee company, for distribution among the members of the transferor company; or

(b) enter into any other arrangement whereby the members of the transferor company may, in lieu of receiving cash, shares, policies or other like interest or in addition thereto, participate in the profits of, or receive any other benefit from, the transferee company:

Provided that no such arrangement shall be entered into without the consent of the secured creditors.

(2) Any transfer, sale or other arrangement in pursuance of this section shall be binding on the members of the transferor company.

(3) Any member of the transferor company who did not vote in favour of the special resolution and expresses his dissent therefrom in writing addressed to the Company Liquidator, and left at the registered office of the company within seven days after the passing of the resolution, may require the liquidator either-

(a) to abstain from carrying the resolution into effect; or

(b) to purchase his interest at a price to be determined by agreement or the registered valuer.

(4) If the Company Liquidator elects to purchase the member’s interest, the purchase money, raised by him in such manner as may be determined by a special resolution, shall be paid before the company is dissolved.