Rules for Purchase of own shares:
So now next despite the rule in Trevor V Whitworth a company may purchase or acquire its own shares in the following cases:
a) Where it acquires its own fully paid shares otherwise than for valuable consideration, as in Re: Castiglione's Will Trusts (49),
b) Where it is a purchase of redeemable shares under S.60 of the Act. This is permitted because the redemption "shall not be taken as reducing the amount of the company's authorized share capital" if it is done in accordance with the provisions of the section.
c) Where the shares are acquired pursuant to the resolution for reducing the company's capital under S.68 of the Act. Such acquisition is permitted because the interests of the company's creditors would have been protected by the court at the time of confirming the proposed reduction.
d) Where the shares are purchased in pursuance of a court order under S.211 (2) on an application by the oppressed members. The shares purchased would be cancelled and the company's capital reduced accordingly.
e) Where the shares are forfeited for non-payment of a call, or where they are surrendered in lieu of a forfeiture.