Sanctioned demerger vesting of shares cannot be defeated by inconsistent later claims or unproven buy-back arrangements.

A sanctioned demerger scheme was described as vesting the gym business and related movable assets, including shares held by the demerged company, in the resulting company by operation of law without further act or deed. The note further records that later assertions of extinguishment, buy-back, or transfer back were not supported by reliable shareholder records, share certificates, board resolutions, or proof of payment. On that reasoning, inconsistent private arrangements could not displace the vesting said to arise under the scheme, and the liquidator's claim over the subject shares was upheld in the text.

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Issues: (i) Whether the 9,598 shares of the appellant company stood vested in the corporate debtor under the approved demerger scheme. (ii) Whether the appellant had validly extinguished, repurchased, or otherwise transferred those shares back so as to defeat the liquidator's claim.

Issue (i): Whether the 9,598 shares of the appellant company stood vested in the corporate debtor under the approved demerger scheme.

Analysis: The approved scheme transferred the gym business of the demerged company to the resulting company without any further act, instrument, or deed, and the transferred business included movable assets. The shares held by the demerged company in the appellant were treated as part of the movable assets connected with the transferred business. The approved scheme therefore operated to vest the subject shares in the resulting company by operation of law.

Conclusion: The shares were held to have vested in the corporate debtor.

Issue (ii): Whether the appellant had validly extinguished, repurchased, or otherwise transferred those shares back so as to defeat the liquidator's claim.

Analysis: The appellant advanced shifting versions of its case, first asserting extinguishment, then buy-back, and later transfer to an ex-promoter. The documentary basis for the alleged transfer and repurchase was found unconvincing, including the shareholder record, the disputed share certificate, the board resolution, and the absence of reliable proof of payment. The inconsistent stands and unsupported documents did not dislodge the title that had vested under the scheme.

Conclusion: The appellant failed to establish any valid extinguishment, buy-back, or transfer back of the shares.

Final Conclusion: The liquidator's claim over the subject shares was upheld, and the appeal was rejected.

Ratio Decidendi: Where a sanctioned scheme of arrangement expressly vests assets in the resulting company, inconsistent later assertions and unproved private arrangements cannot defeat the statutory vesting or the liquidator's entitlement to recover those assets.

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