COMPANIES ACT, 19zq

6q5

circumstances in which the business of the company was carried on
the default was excusable, be liable on conviction on indictment to
imprisonment for a term not exceeding one year, or on summary
conviction to imprisonment for a term not exceeding six months.
(2) For the purposes of this section, proper books of account
shall be deemed not to have been kept in the case of any company if
there have not been kept such books or accounts as are necessary to
exhibit and explain the transactions and financial position of the
trade or business of the company, including books containing
entries from day to day in sufficient detail of all cash received and
cash paid, and, where the trade or business has involved dealings in
goods, statements of the annual stocktakings and (except in the case
of goods sold by way of ordinary retail trade) of all goods sold and
purchased, showing the goods and the buyers and sellers thereof in
sufficient detail to enable those goods and those buyers and sellers
to be identified.

275.—(1) If in the course of the winding up of a company it
appears that any business of the company has been carried on with
intent to defraud creditors of the company or creditors of any other
person or for any fraudulent purpose, the court, on the application of
the official receiver, or the liquidator or any creditor or contributory
of the company, may, if it thinks proper so to do, declare that any
of the directors, whether past or present, of the company who were
knowingly parties to the carrying on of the business in manner
aforesaid shall be personally responsible, without any limitation of
liability, for all or any of the debts or other liabilities of the company
as the court may direct.

Responsibility
»f directors for
fraudulent
trading.

(2) Where the court makes any such declaration, it may give
such further directions as it thinks proper for the purpose of giving
effect to that declaration, and in particular may make provision for
making the liability of any such director under the declaration a
charge on any debt or obligation due from the company to him, or on
any mortgage or charge or any interest in any mortgage or charge
on any assets of the company held by or vested in him, or any
company or person on his behalf, or any person claiming as assignee
from or through the director, company or person, and may from
time to time make such further order as may be necessary for the
purpose of enforcing any charge imposed under this subsection.

For the purpose of this subsection, the expression ‘‘assignee’’
includes any person to whom or in whose favour, by the directions
of the director, the debt, obligation, mortgage or charge was created,
issued or transferred or the interest created, but does not include
an assignee for valuable consideration (not including consideration
by way of marriage) given in good faith and without notice of any of
the matters on the ground of which the declaration is made.

(3) Where any business of a company is carried on with such
intent or for such purpose as is mentioned in subsection (1) of this
section, every director of the company who was knowingly a party