Meaning of Reconstruction

prescribed manner to the holders of the remaining shares or of the remaining shares of that class, as the case may be, who have not assented to the scheme or contract; and
(b) any such holder may, within 3 months from the giving of the notice to him,
require the transferee company to acquire the shares in question;
and where a shareholder gives notice under clause (b) with respect to any share, the transferee company shall be entitled and bound to acquire those shares on the terms on which, under the scheme or contract, the shares of the approving shareholders were transferred to it, or on such other terms as may be agreed, or as the Court on the application of either the transferring company or the shareholder thinks fit to order.
Where a notice has been given to the transferee company under sub-sec.(l) and the court has not, on an application made by the dissenting shareholder, made an order to the contrary, the transferee company, shall, on the expiry of one month from the date on which the notice has been given or if an application to the court by the dissenting shareholder is then pending, after that application has been disposed of transmit a copy of the notice to the transferor company together with an instrument of transfer executed on behalf of the shareholder by any person appointed by the transferee company and on its own behalf by the transferee company and payor transfer to the transferor company the amount or other consideration representing the price payable by the transferee company for the shares which by virtue of this section, that company is entitled to acquire; and the transferor company shall
(a) thereupon register the transferee company as the holder of those shares; and
(b) within one month of the date of such registration, inform the dissenting
shareholders of the fact of such registration, and of receipt of the amount or other consideration representing the price payable to them by the transferee company .
Provided that an instrument of transfer shall not be required for any share for
which a share warrant is for the time being outstanding [Sub-sec.(3»).
Any sum received by the transferor company, under this Section shall be paid into a
. separate bank account, and any such sums and any other consideration so received shall
be held by that company in trust for the several persons entitled to the shares in respect .
of which the said sums or other considerations were respectively received [Sub-sec.(4)].
~ 4. What is meant by 'Reconstruction'? How can a company, under a members' voluntary winding-up, be reconstructed by sale of its business or pr.operty? What are
the rights of dissenting shareholders in such a case? fC.A. (Final) May, 199~J

.9Lns .

Meaning of Reconstruction
Please see answer to Q. 2.
Reconstruction of a Company Under Members' Voluntary Winding Up
According to Section 494 of the Companies Act, a company which is proposed to be, or is in the course of being wound up voluntarily, may sell its business to another company and the compensation received, whether in the form of shares, policies or other like interest in the transferee company, may be distributed among the