INSOLVENCY ACT - 1962 (ACT 153)
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(1) There shall be an Official Trustee, whose post shall be a Civil Service post.
(2) Any act required or authorised to be done by or in relation to the Official Trustee may instead be done by or in relation to any Civil Servant for the time being authorised in that behalf either by the Official Trustee or under any enactment, and a Civil Servant shall be presumed to be so authorised unless the contrary is shown.
(3) References to the Official Trustee in any enactment shall be taken to include all Civil Servants authorised or presumed to be authorised as aforesaid.
(4) Where he considers it necessary for the exercise of his functions, the Official Trustee may avail himself for appropriate payment of the services of persons who are not Civil Servants.
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(1) Any person aggrieved by an act done by the Official Trustee in the exercise of his functions under this Act may appeal to the Court, which shall make such order as it thinks fit.
(2) If any person refuses or fails to comply with a requirement made by the Official Trustee under this Act, the Official Trustee may apply to the Court, and the Court may order the requirement to be carried out.
(3) If the Official Trustee is in doubt as to any matter arising in connection with his functions under this Act he may apply to the Court for directions.
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(1) There shall be a public fund to be known as the Insolvent Estates Fund, to which shall be credited all sums received by the Official Trustee under this Act and to which shall be debited all sums disbursed by him thereunder.
(2) There shall be an account within the Insolvent Estates Fund to which shall be credited all sums received by the Official Trustee by way of fees and other charges, in this Act referred to as the Fees Account.
(3) All payments required or authorised by this Act to be met out of the Insolvent Estates Fund are hereby charged on that Fund.
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(1) Whenever any information requires to be recorded in the Insolvency Register, the Official Trustee, in addition to recording the information in the Register, shall also cause it to be published in the Gazette within fourteen days after it becomes available to him.
(2) As soon as may be after the end of each June and December, the Official Trustee shall cause a notice to be published in the Gazette giving the names, including former names, and addresses of all bankrupts, together with the dates on which they were adjudged bankrupt and their appointed discharge dates.
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(1) No liability shall attach to the Official Trustee in respect of any breach of a duty imposed on him by or under this Act, and except in so far as may result from an order made under subsection (3) of section 42 of this Act, no liability shall attach to the Republic in respect of any such breach.
(2) Nothing in this section shall affect the institution against a Civil Servant of any criminal proceedings or of disciplinary proceedings under the Civil Service Act, 1960 (C.A. 5).
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As soon as may be after the end of each December, the Official Trustee shall prepare a report giving details of the operation of this Act during the previous year, and the report shall be laid before the National Assembly.
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While a protection order has effect,
(a) existing and after-acquired property of the debtor shall vest in the Official Trustee in accordance with sections 37 and 38 of this Act and shall be conserved by him in accordance with section 43 thereof;
(b) the debtor shall be subject to the duties and disabilities specified in sections 25, 26, 28 and 29 of this Act;
(c) no civil proceedings by or against the debtor shall be instituted or continued without the leave of the Court.
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(1) The Court shall rescind the protection order if it appears,
(a) that having regard to any new evidence and to the circumstances generally, the order should not have been made; or
(b) that owing to payments made on behalf of the debtor or other change of circumstances, payment in full has been achieved.
(2) If the Official Trustee informs the Court that the assets vested in him in respect of the debtor are likely to be sufficient to provide for payment in full, the Court may adjourn the hearing of the application for judicial consideration and authorise the Official Trustee to realise and distribute the assets in the same manner as if an insolvency order had been made.
(3) Where the hearing has been adjourned under the preceding subsection the Official Trustee shall apply to the Court for the hearing to be resumed,
(a) when payment in full has been achieved; or-
(b) if at any time it appears to him that the assets are after all insufficient to provide for payment in full,
and where it is satisfied that payment in full has been achieved the Court shall rescind the protection order.
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(1) Where a public examination has been held under the preceding section, the Court shall make an order adjudging the debtor a bankrupt if one or more of the following have been established, namely,
(a) that for a consecutive period of twelve months within the three years preceding the making of the protection order, the debtor continued to carry on his trade or business in the knowledge that he was insolvent;
(b) that the debtor contributed to his insolvency by rash speculations or culpable neglect of his business affairs, or by gambling or unjustifiable extravagance;
(c) that a provable debt was contracted by the debtor with the intention that it should not be met or without a reasonable expectation of being able to meet it;
(d) that the debtor has failed to account satisfactorily for assets of his which have disappeared since the date of the making of the protection order or during the year previous to that date;
(e) that the debtor has persistently and without adequate excuse failed to carry out his duties in the insolvency proceedings;
(f) that the debtor is a former bankrupt;
(g) that within the preceding three years the debtor has been convicted of an offence involving dishonesty in relation to property and has been sentenced to imprisonment for three months or more,
(h) that within the preceding three years the debtor has been convicted of an offence under section 7 or 8 of the Registration of Business Names Act, 1962 (Act 151).
(2) The order shall specify a date for the discharge of the bankrupt, being a date at least two years after the making of the order.
(3) Where the Court has directed the debtor to undergo a public examination under the preceding section but the examination cannot be held because the debtor has absconded, or is medically unfit to appear, or for any other reason, the Court may proceed under this section as if the examination had been held.
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(1) Where a public examination has been held under the preceding section, the Court shall make an order adjudging the debtor a bankrupt if one or more of the following have been established, namely,
(a) that for a consecutive period of twelve months within the three years preceding the making of the protection order, the debtor continued to carry on his trade or business in the knowledge that he was insolvent;
(b) that the debtor contributed to his insolvency by rash speculations or culpable neglect of his business affairs, or by gambling or unjustifiable extravagance;
(c) that a provable debt was contracted by the debtor with the intention that it should not be met or without a reasonable expectation of being able to meet it;
(d) that the debtor has failed to account satisfactorily for assets of his which have disappeared since the date of the making of the protection order or during the year previous to that date;
(e) that the debtor has persistently and without adequate excuse failed to carry out his duties in the insolvency proceedings;
(f) that the debtor is a former bankrupt;
(g) that within the preceding three years the debtor has been convicted of an offence involving dishonesty in relation to property and has been sentenced to imprisonment for three months or more,
(h) that within the preceding three years the debtor has been convicted of an offence under section 7 or 8 of the Registration of Business Names Act, 1962 (Act 151).
(2) The order shall specify a date for the discharge of the bankrupt, being a date at least two years after the making of the order.
(3) Where the Court has directed the debtor to undergo a public examination under the preceding section but the examination cannot be held because the debtor has absconded, or is medically unfit to appear, or for any other reason, the Court may proceed under this section as if the examination had been held.
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(1) In addition to the duties and disabilities imposed on a bankrupt by virtue of an insolvency order having been made against him, he shall be subject to the provisions of this section.
(2) A bankrupt shall not,
(a) carry on, or take part in the management or direction of, any trade or business;
(b) operate an account with a bank, building society or similar institution;
(c) obtain credit exceeding ten pounds; or
(d) enter into any hire-purchase agreement,
except with the consent in writing of the Official Trustee and in accordance with such directions as may from time to time be given to him by the Official Trustee.
(3) A bankrupt shall,
(a) keep a record of his income, expenditure and other financial dealings in a form approved by the Official Trustee; and
(b) lodge with the Official Trustee at intervals of not more than four months an income and expenditure account in a form so approved.
(4) In this section "hire-purchase agreement" means an agreement by which a person agrees to bail goods to a bailee on terms such that property in the goods may or will pass to the bailee after payment of two or more instalments.
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(1) If, while insolvency proceedings are in progress against a debtor, it appears to the Court that the proceedings are or may be impeded by reason that the debtor,
(a) has absconded, or is likely to do so;
(b) has removed, concealed, destroyed or damaged any property, or is likely to do so; or
(c) is likely to fail to attend as required before the Court, the Official Trustee or any meeting of creditors,
then, without prejudice to its powers in relation to contempt of court, the Court may issue a warrant for the arrest of the debtor, or the seizure of the property in question, or for both arrest and seizure.
(2) Where a warrant of arrest is issued under this section the provisions of the Criminal Procedure Code, 1960 (Act 30) relating to arrest shall apply in the same way as they apply to arrest for a criminal offence; and a debtor arrested under such warrant may, for the purposes of the insolvency proceedings, be conveyed in custody to any hearing by the Court or the Official Trustee, or to any meeting of creditors.
(3) Property seized under this section shall be dealt with as the Court may direct, so however that property which does not belong to the debtor and is not likely to be subject to the powers of the Official Trustee under Part III of this Act shall be returned to its owner as soon as is practicable.
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(1) The date of discharge from an insolvency order of a debtor who is not a bankrupt shall be the earliest of the following dates, namely,
(a) the date two years after the insolvency order was made;
(b) the date on which payment in full is achieved;
(c) the date specified in a proposal for additional payment approved by the Court under section 31 of this Act.
(2) The date of discharge from an insolvency order and from bankruptcy of a debtor who is a bankrupt shall be the date fixed under section 23 of this Act at the time when the debtor was adjudged bankrupt, or if that date has been altered by the Court under section 31 or 32 of this Act, shall be the date as so altered.
(3) The date which will be the date of discharge unless an event occurs to alter it is in this Act referred to as the appointed discharge date.
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On the arrival of the appointed discharge date of a bankrupt or other debtor, the debtor shall be deemed to be discharged, and as soon as may be thereafter the Official Trustee shall issue to the debtor a certificate of discharge.
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(1) The discharge of a bankrupt or other debtor shall,
(a) release him from all provable debts whether or not included in any proof of debts;
(b) relieve him for the future from any duties and liabilities under section 24, 26, and 27 of this Act.
(2) The discharge of a bankrupt or other debtor shall not,
(a) release any person who at the date when the insolvency order was made was a partner or co-trustee of the debtor, or was jointly bound with him under a contract or otherwise, or was a surety or in the nature of a surety for him; or
(b) bring the insolvency proceedings to an end.
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(1) Where an insolvency order is not made, insolvency proceedings shall come to an end on the happening of any of the following events, namely,
(a) the withdrawal or dismissal of the petition by which the proceedings were initiated;
(b) the confirmation of an arrangement with creditors under section 20 of this Act;
(c) the rescission of the protection order under section 21 of this Act.
(2) Where an insolvency order is made the insolvency proceedings shall come to an end on the making by the Court of an order under the following section.
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(1) On and by the virtue of the making of a protection order there shall vest in the Official Trustee to the same extent and, subject to subsection (3) of this section, with the same incidents, all movable and immovable property vested in the debtor immediately before the order was made.
(2) All property in the possession of the debtor at any time within six months before the protection order was made shall be presumed to be vested in the debtor unless the contrary is shown.
(3) Property which has become vested in the Official Trustee under this section shall not be subject to attachment, distress or other proceedings for the enforcement of an obligation against the debtor, whether founded on a judgment or not:
Provided that this subsection shall not apply to proceedings for the enforcement of a security.
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(1) The Official Trustee shall bring about the vesting in him, to the same extent and, subject to subsection (3) of this section, with the same incidents, of all after-acquired property of the debtor except property exempted by the next subsection or property which would not be of value to the creditors.
(2) The following after-acquired property shall be exempted namely,
(a) property necessary for the reasonable current maintenance of the debtor, his spouse and children;
(b) money paid or payable to the debtor, as compensation for his diminished earning capacity, by way of damages for personal injury or other lump sum;
(c) money paid or payable to the debtor by way of loan;
(d) movable property bought by the debtor and not paid for in full;
(e) property in which any property mentioned in paragraph (b),(c), or (d) of this subsection has been directly or indirectly invested, or which otherwise represents the same.
(3) Property which has become vested in the Official Trustee under this section shall not be subject to attachment, distress or other proceedings for the enforcement of an obligation against the debtor, whether founded on a judgment or not:
Provided that this subsection shall not apply to proceedings for the enforcement of a security.
(4) If the debtor has, with respect to after-acquired property which is not exempted, entered into any transaction whereby the whole or any part of the value of the property is lost to the creditors, the Official Trustee may apply to the Court for an order setting aside the transaction and requiring the property or its value, or such part thereof as was lost to the creditors, as the case may be, to be transferred to the Official Trustee.
(5) The Official Trustee may give notice to any employer, banker or other person who but for this section would be under an obligation to transfer after-acquired property which is not exempted to, or to the order of, the debtor to transfer the property instead to the Official Trustee, whose receipt shall be a sufficient discharge.
(6) A person who fails to comply with a notice under the preceding subsection shall pay to the Official Trustee such sum as may be necessary to make good any loss to the creditors arising from the failure.
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(1) If the value of a debt or security included in an admitted proof has changed otherwise than in respect of interest accruing after the protection order was made, the proof shall be subject to amendment for the purpose of altering the value shown therein to give effect to the change.
(2) If a debt or security is incorrectly included in an admitted proof, or the value of a debt or security at the date of the making of the protection order is incorrectly stated, the proof shall be subject to amendment for the purpose of rectifying the incorrectness.
(3) If a creditor desires to withdraw his claim to the whole or a part of a debt included in an admitted proof the proof shall be subject to amendment for the purpose of deleting the debt or reducing its value accordingly, as the case may be.
(4) Where an admitted proof is subject to amendment under this section,
(a) the Official Trustee may, except in the case of an amendment under the preceding subsection, give notice to the creditor specifying the proposed amendment and inviting him to consent to it within the period specified in the notice; or
(b) the creditor may, if the Official Trustee has not given him notice as aforesaid, give notice to the Official Trustee specifying the proposed amendment and, except in the case of an amendment under the preceding subsection, inviting him to consent to it within the period specified in the notice.
(5) Where notice of a proposed amendment is given under the preceding subsection the Official Trustee shall amend the proof accordingly if,
(a) the party to whom the notice is given consents to the amendment;
(b) consent is not given but, on an appeal by the creditor or an application by the Official Trustee, the Court orders the amendment to be made; or
(c) the amendment is proposed by the creditor under subsection (3) of this section.
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(1) On the making of an insolvency order it shall be the duty of the Official Trustee, in relation to each debt which ranks for dividend, to ascertain into which of the following classes the whole or any part of the debt falls:
Class A.- A debt or part of a debt which answers either of the following descriptions, that is to say,
(a) remuneration not exceeding one hundred and fifty pounds owed to an employee of the debtor, not being a near relative, in respect of employment during the whole or any part of the four months preceding the making of the protection order;
(b) rates, taxes or similar payments owed to the Republic or a local authority which have become due and payable within the year preceding the making of the protection order.
Class B.-A debt or part of a debt which does not fall into any other class.
Class C.- a debt or part of a debt which does not fall within class D and is, or was at any time within the year preceding the making of the protection order, owed to a near relative of the debtor.
Class D.- A debt or part of a debt which answers either of the following descriptions, that is to say,
(a) excess benefit restored to the Official Trustee under section 40 of this Act;
(b) excess interest, that is any portion of a debt which, whether it is stated to do so or not, represents interest at a rate in excess of seven per centum per annum.
(2) For the purposes of this section the following shall be taken to be near relatives of the debtor, that is to say,
(a) his spouse, parents and issue;
(b) his brothers, sisters, uncles, aunts, nephews and nieces, whether of the whole or the half blood.
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(1) Subject to the provisions of this Act, it shall be the duty of the Official Trustee,
(a) to report to the creditors, at intervals not greater than six months, on the progress of the insolvency proceedings;
(b) to consult the creditors on any matter arising in the proceedings which substantially affects their interests; and
(c) to give effect, so far as may be practicable, to any views expressed by the creditors in relation to the realisation and distribution of assets.
(2) For the purpose of complying with the preceding subsection, the Official Trustee may call a meeting of creditors at any time, and shall call such a meeting if required to do so by a notice in writing signed by creditors whose votes exceed one-fifth of the total number of votes which could be cast at the meeting.
Sch.
(3) The Schedule to this Act shall apply in relation to every meeting of creditors called under this section.
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(1) If the Official Trustee is of opinion that it is necessary, in order to enable him to carry out his functions under this Part of this Act in relation to a debtor, for the debtor, any creditor or any other person to be brought before and examined by the Court he may order him to attend for that purpose before the Court.
(2) In proceedings under this section the Court may examine on oath or otherwise any person brought before it, may order the delivery up by any such person of assets to which the Official Trustee is entitled under this Act, and make such other order as it thinks just.
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(1) As soon as is practicable after an arrangement with creditors is confirmed under section 20 of this Act, the Official Trustee, unless he is to act as trustee under the arrangement, shall cause all property which has become vested in him under section 37 or 38 of this Act in respect of the debtor to be transferred to the person entitled thereto under the arrangement.
(2) As soon as practicable after a protection order is rescinded under section 21 of this Act, the Official Trustee shall cause all property which has become vested in him under section 37 or 38 of this Act in respect of the debtor to be transferred back to the debtor.
(3) Notwithstanding the preceding provisions of this section, the Official Trustee shall be entitled to retain assets sufficient to reimburse him for fees and outgoings due to him from the debtor in respect of the insolvency proceedings.
(4) This section shall not apply to any property which has already passed from the Official Trustee under the provisions of this Part of this Act, so however that it shall apply to the proceeds of property which has been realised as it applies to property which has been retained in its original form.
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(1) Within one year after any property has become vested in him under section 37 of this Act, the Official Trustee, if he is of opinion that the property will not be of benefit to the creditors, may by notice published in the Gazette disclaim the property:
Provided that if any person interested in property so vested in the Official Trustee has by application in writing required the Official Trustee to elect whether he disclaims the property or not, this subsection shall not apply if the Official Trustee fails to disclaim within one month after the making of the application, or such longer period as the Court may allow.
(2) The Court may on the application of any person interested, give such relief and make such other provision as it thinks just in consequence of disclaimer under this section.
(3) Subject to an order made by the Court, the effect of disclaimer shall be as follows, that is to say,
(a) if the property consists of rights under a lease, share, contract or other interest, the interest shall be void to the extent that it affects the Official Trustee or the debtor;
(b) if the property consists of the absolute ownership of land or chattels that ownership shall revert to the debtor.
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(1) The Official Trustee shall make and keep a register, to be known as the Arrangements Register, in which shall be recorded the prescribed particulars of instruments lodged with the Official Trustee under the following section.
(2) If the Official Trustee is satisfied that an arrangement recorded in the Arrangements Register has been fully carried out, or has otherwise ceased to have effect, he shall record the fact in the Register.
(3) The Arrangements Register and copies of instruments recorded therein shall at all reasonable times be open for public inspection on payment of such fee, if any, as may be prescribed.
(4) The Official Trustee shall, on application being made by any person in the prescribed form, and on payment of the prescribed fee, provide copies of any entry in the Arrangements Register or any instrument recorded therein.
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(1) Where insolvency proceedings are instituted in respect of two or more debtors jointly, debts not owed jointly by all the debtors shall be disregarded for the purpose of section 9 or 10 of this Act.
(2) Where a protection order is made in respect of two or more debtors jointly,
(a) any petition pending against any of the debtors individually shall lapse;
(b) subject to the provisions of this section, the insolvency proceedings shall extend to debts owed by the debtors separately as well as to their joint debts, and assets of the debtors shall vest in the Official Trustee whether or not they are referable to the joint debts;
(c) in addition to the joint official account opened under section 42 of this Act, a separate official account shall be opened in respect of each debtor, in which shall be entered items referable to his separate estate and his separate debts.
(3) Where an insolvency order is made in respect of two or more debtors jointly,
(a) the joint estate shall be applicable in the first instance in payment of the joint debts, and if there is a surplus of the joint estate it shall be dealt with as part of the respective separate estates in proportion to the interest of each debtor in the joint estate;
(b) the separate estate of each debtor shall be applicable in the first instance in payment of his separate debts and if there is a surplus of any separate estate it shall be dealt with, so far as may be necessary for satisfying the joint debts, as part of the joint estate.
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(1) A person who does any act in contravention of a duty imposed on him as a debtor or as the representative of a deceased debtor by or under this Act is guilty of a misdemeanour.
(2) This section is without prejudice to the power of the Court to issue a warrant in relation to a debtor under section 28 of this Act, or to punish any person for contempt of court or for an offence under the Criminal Code, 1960 (Act 29).
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In this Act, unless the context otherwise requires,
"address" includes place of residence, place of business and any post office box number habitually used;
"admitted proof" means a proof admitted under subsection (6) of section 15 of this Act or subsection (5) of section 68 thereof;
"after-acquired property" has the meaning assigned to it by subsection (2) of section 26 of this Act;
"application for judicial consideration" has the meaning assigned to it by subsection (1) of section 17 of this Act;
"appointed discharge date" has the meaning assigned to it by subsection (3) of section 30 of this Act;
"arrangement with creditors" means a contract between a debtor and his creditors under which, with a view to the payment of debts in whole or in part, the creditors agree not to exercise, or agree to defer or modify the exercise of, any of their rights in respect of the debtor;
"bankrupt" means a person who has been adjudged a bankrupt under section 23 of this Act and has not been discharged;
"civil proceedings" means proceedings, other than criminal proceedings or proceedings under this Act, in or on the order of any court, and includes the levying of distress, or the attachment of a debt, without a court order;
"Court" means the High Court;
"Fees Account" has the meaning assigned to it by subsection (2) of section 3 of this Act;
"ground for bankruptcy" means any one or more of the grounds specified in subsection (1) of section 23 of this Act;
"insolvent" means unable to pay debts as they fall due;
"name" in relation to a debtor includes any name under which the debtor carries on a business, whether by himself or with other persons;
"official account" in relation to a debtor means the account opened in respect of the debtor under section 42 of this Act;
"payment in full" means the making of provision for all such payments and transfers of property as in the circumstances are required to be made under sections 52 to 54 of this Act;
"prescribed" means prescribed by Rules made under subsection (1) of section 76 of this Act;
"provable debt" has the meaning assigned to it by subsection (1) of section 15 of this Act;
"security" means a mortgage, charge or lien on the property of the debtor for securing payment of a debt, and "secured creditor" and "secured debt" shall be construed accordingly.
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(1) This Act shall come into operation on such date as the Minister responsible for Justice may, by legislative instrument, appoint, and different dates may be appointed for different provisions.
(2) A provision of this Act shall apply in relation to matters arising before the commencement of that provision as it applies in relation to matters arising thereafter:
Provided that,
(a) no act done or suffered before the commencement of Part II of this Act shall be taken into account in considering whether the grounds for bankruptcy exist under paragraph (a) or (h) of subsection (1) of section 23 of this Act;
(b) Part IV of this Act shall not apply to an arrangement with creditors made before the commencement of that Part.
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