Companies Act, 1990
|
Amendment of section 89 of the Principal Act. |
227.—The following section is hereby substituted for section 89 of the Principal Act: | |
“Validation of invalid issue, redemption or purchase of shares. | ||
89.—(1) If a company has created or issued shares in its capital, or acquired any of its shares by a redemption or purchase in purported compliance with Part XI of the Companies Act, 1990, and if there is reason to apprehend that such shares were invalidly created, issued or acquired as aforesaid, the court may, on the application of the company, any holder or former holder of such shares or any member or former member or creditor, or the liquidator, of the company, declare that such creation, issue or acquisition shall be valid for all purposes if the court is satisfied that it would be just and equitable to do so and thereupon such shares shall from the creation, issue or acquisition thereof, as the case may be, be deemed to have been validly created, issued or acquired. | ||
(2) Where shares have been redeemed or purchased in contravention of paragraph (d), (e) or (f) of section 207 (2) or section 207 (3) of the Companies Act, 1990, then the court shall not make a declaration under subsection (1) above in respect of those shares. | ||
(3) The grant of relief by the court under this section shall, if the court so directs, not have the effect of relieving the company or its officers of any liability incurred under section 41 (3) of the Companies (Amendment) Act, 1983 .”. |