Liability of shareholders in respect of reduced share capital

(1) Except as otherwise provided for in this Section, a shareholder of the company, past or present, shall not be liable, in respect of any share mentioned in the order issued by the Court confirming the reduction of share capital, to pay any amount exceeding the difference between the amount actually paid on the share or the reduced amount, if any, which is deemed to have been paid thereon, as the case may be , and the fixed amount of such share.

Provided, however, that where the list of creditors entitled to object to the reduction of share capital submitted to the Court omits any such creditor and, after an order confirming the reduction of capital of the company has been made, the company is unable to pay the amount of debt of such creditor, the shareholder of the company shall be bound to pay the amount as mentioned in Sub-section (3) or (4) .

(2) Notwithstanding anything contained in the proviso to Subsection (1), where the list submitted to the Court omits the name or any claim of a creditor because of a fault or negligence of his own, the shareholders shall not be bound to pay such amount.

(3) A person who was a shareholder of a company at the date of issue by the Court of an order confirming the resolution for reducing the capital of the company shall be liable to pay an amount not exceeding the amount which he would have been liable to pay if the company had undergone insolvency and commenced insolvency proceedings on the day immediately before the said date.

(4) If a company is insolvent, and where an application is made by a creditor whose name is said to be omitted from the list of creditors submitted to the Court, along with the proof of omission of his name, the Court may, if it thinks fit, settle a list of shareholders who are liable to pay to the company the amount required for the repayment of loan of such creditor and issue an order to make calls on shares held by the shareholders settled on such list as if they were ordinary contributors in an insolvency process of the company.

(5) Notwithstanding anything contained elsewhere in this Section, no shareholder shall be liable to pay an amount in excess of the face value of a share at the time of the subscription of such share by him.