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Internal Reconstruction:

1. No new company is formed. The existing company continues as a going concern;

2. The ailing company will not gove ito liquidation under the capital reduction scheme and

3. Involves complying the requirements under the Companies Act.

External Reconstruction:-

1. A new company is formed by the existing shareholder of the old company to take over the assets and liabilities;

2. The ailing company goes into liquidation and

3. There is no need to comply with particular clause in the Companies Act. Anonymous

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Bhimireddy

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13y ago

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