494. POWER OF LIQUIDATOR TO ACCEPT SHARES, ETC., AS CONSIDERATION FOR SALE OF PROPERTY OF COMPANY

(1) Where -

(a) a company (in this section called "the transferor-company") is proposed to be, or is in course of being, wound up altogether voluntarily ; and

(b) the whole or any part of its business or property is proposed to be transferred or sold to another company, whether a company within the meaning of this Act or not (in this section called "the transferee-company") ; the liquidator of the transferor-company may, with the sanction of a special resolution of that company conferring on the liquidator either a general authority or an authority in respect of any particular arrangement, -

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

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

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

(3) If any member of the transferor-company who did not vote in favour of the special resolution expresses his dissent therefrom in writing addressed to the liquidator, and left at the registered office of the company within seven days after the passing of the resolution, he 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 by arbitration in the manner provided by this section.

(4) If the liquidator elects to purchase the member's interest, the purchase money shall be paid before the company is dissolved, and be raised by the liquidator in such manner as may be determined by special resolution.

(5) A special resolution shall not be invalid for the purposes of this section by reason only that it is passed before or concurrently with a resolution for voluntary winding up or for appointing liquidators ; but if an order is made within a year for winding up the company by the Tribunal, the special resolution shall not be valid unless it is sanctioned by the Tribunal.

(6) The provisions of the Arbitration Act, 1940 (10 of 1940), other than those restricting the application of that Act in respect of the subject- matter of the arbitration, shall apply to all arbitrations in pursuance of this section.