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The Companies Act, 2013

Chapter XIX - Revival And Rehabilitation of Sick Companies (253-269)

Section 261- Scheme of revival and rehabilitation.

[Section 261 omitted w.e.f.15.11.2016 vide Notification 37 dated 28.05.2016 (Insolvency and Bankruptcy Code, 2016) read with MCA Notification S.O.3453(E) dated 15.11.2016 effective from 15.11.2016.

Section 261- Scheme of revival and rehabilitation. [Corresponds to Section 424D of the Companies Act, 1956];



Prior to Omission Section 261 read as under:

Section 261- Scheme of revival and rehabilitation. 

(1) The company administrator shall prepare or cause to be prepared a scheme of revival and rehabilitation of the sick company after considering the draft scheme filed along with the application under section 254.

(2) A scheme prepared in relation to any sick company under sub-section (1) may provide for any one or more of the following measures, namely:—

(a) the financial reconstruction of the sick company;

(b) the proper management of the sick company by any change in, or by taking over, the management of such company;

(c) the amalgamation of—

(i) the sick company with any other company; or

(ii) any other company with the sick company;

(d) takeover of the sick company by a solvent company;

(e) the sale or lease of a part or whole of any asset or business of the sick company;

(f) the rationalisation of managerial personnel, supervisory staff and workmen in accordance with law;

(g) such other preventive, ameliorative and remedial measures as may be appropriate;

(h) repayment or rescheduling or restructuring of the debts or obligations of the sick company to any of its creditors or class of creditors;

(i) such incidental, consequential or supplemental measures as may be necessary or expedient in connection with or for the purposes of the measures specified in clauses (a) to (h).