You have learnt that under scheme of arrangement, the company may make a compromise with its creditors and members and applies to the Court for approval of the scheme.
In this sub unit, you have also learnt that in an arrangement and reconstruction, a company can apply to court to restrain any proceedings by creditors against the company. However the court is to decide whether to grant the restrain order.
Lastly, the process involved in the two corporate exercises and the governing legislation regulated these exercises were discussed, i.e., Section 176, and Section 178 of Companies Act 1965 respectively.
| Self-test 4.2
|Question to self-test 4.2||Suggested answers to self-test 4.2|