ACT 125

COMPANIES ACT 1965 (REVISED - 1973)

PART X - WINDING UP

DIVISION 4 - PROVISIONS APPLICABLE TO EVERY MODE OF WINDING UP

Subdivision (3) - Effect on other Transactions

Section 295. Liquidator's right to recover in respect of certain sales to or by company.

(1) Where any property, business or undertaking has been acquired by a company for a cash consideration within a period of two years before the commencement of the winding up of the company— (a) from a person who was at the time of the acquisition a director of the company; or (b) from a company of which, at the time of the acquisition, a person was a director who was also a director of the first-mentioned company, the liquidator may recover from the person or company from which the property, business or undertaking was acquired any amount by which the cash consideration for the acquisition exceeded the value of the property, business or undertaking at the time of its acquisition. (2) Where any property, business or undertaking has been sold by a company for a cash consideration within a period of two years before the commencement of the winding up of the company— (a) to a person who was at the time of the sale a director of the company; or (b) to a company of which at the time of the sale a person was a director who was also a director of the company first mentioned in this subsection, the liquidator may recover from the person or company to which the property, business or undertaking was sold any amount by which the value of the property, business or undertaking at the time of the sale exceeded the cash consideration. (3) For the purposes of this section the value of the property business or undertaking includes the value of any goodwill or profits which might have been made from the business or undertaking or similar considerations. (4) In this section "cash consideration" in relation to an acquisition or sale by a company, means consideration for the acquisition or sale payable otherwise than by the issue of shares in the company.