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Resolution for the variation - Statutory provisions:
Where any application is made pursuant to this provision, the variation shall not have effect unless and until it is confirmed by the court.
An application under the section must be made by petition within thirty days after the date on which the consent was given or the resolution was passed. It may be made on behalf of the applicants by such one or more of their number as they may appoint in writing for the purpose.
S. 74(3) provides that on any such application the court, later than hearing the applicant and any other persons that who apply to the court to be heard and appear to the court to be interested in the application, may disallow the variation if it is satisfied, through having all the circumstances of the case, in which the variation would unjustly prejudice the shareholders of the class represented by the applicant.
Exceptions of Merger accounting: S.56 (1) permits a company to give financial assistance for a purchase of, or subscription for, its shares in the following circumstances:
XYZ Ltd has 1000 members and it has adopted a constitution. Matt is one of the directors of XYZ Ltd. Matt has made a gift of $10,000 to his wife, Melissa out of the Company's funds
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