THE BANKRUPTCY ACT
If an apprentice or articled clerk is tied to a bankrupt when a bankruptcy petition is presented, written notice to the trustee can make the apprenticeship or articles end, and the trustee may also pay a reasonable sum or transfer the agreement in some cases.
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If an apprentice or articled clerk is tied to a bankrupt when a bankruptcy petition is presented, written notice to the trustee can make the apprenticeship or articles end, and the trustee may also pay a reasonable sum or transfer the agreement in some cases. A landlord or other person owed rent by a bankrupt may distrain on the bankrupt’s goods, with limits if the distress is levied after bankruptcy starts. A relative of a debtor cannot claim as a creditor for certain claims until the other creditors’ claims for value have been paid. This section says when a debtor’s bankruptcy is treated as starting for legal purposes, depending on the relevant bankruptcy order or act of bankruptcy. Bankrupt property divisible among creditors excludes trust property and certain tools, clothing, and bedding up to 500 shillings, though the court may raise that allowance up to 1,000 shillings.
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Provisions of THE BANKRUPTCY ACT
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- 39 Verify source ↗
Preferential claim in case of apprenticeship
AI-assisted research summary: If an apprentice or articled clerk is tied to a bankrupt when a bankruptcy petition is presented, written notice to the trustee can make the apprenticeship or articles end, and the trustee may also pay a reasonable sum or transfer the agreement in some cases.
39.–(1) Where at the time of the presentation of the bankruptcy petition, a person is apprenticed or is an articled clerk to the bankrupt, the adjudication of bankruptcy shall, if either the bankrupt or apprentice or clerk gives notice in writing to the trustee to that effect, be a complete discharge of the indenture of apprenticeship or article of agreement; and, where any money has been paid by or on behalf of the apprentice or clerk to the bankrupt as a fee, the trustee may, on the application of the apprentice or clerk, or of some person on his behalf, pay sum as the trustee, subject to an appeal to the court, thinks reasonable, out of the bankrupt’s property, to or for the use of the apprentice or clerk, regard being had to the amount paid by him or on his behalf, and the time during which he served with the bankrupt under the indenture or articles before the commencement of the bankruptcy, and other circumstances of the case. (2) Where it appears expedient to a trustee, he may, on the application of any apprentice or articled clerk to the bankrupt, or any person acting on behalf of apprentice or articled clerk, instead of acting under the preceding provisions of this section, transfer the indenture of apprenticeship or articles of agreement to some person. Landlord’s power of distress in case of bankruptcy - 40 Verify source ↗
Landlord’s power of distress in case of bankruptcy
AI-assisted research summary: A landlord or other person owed rent by a bankrupt may distrain on the bankrupt’s goods, with limits if the distress is levied after bankruptcy starts.
40. The landlord or other person to whom any rent is due from the bankrupt may at any time, either before or after the commencement of the bankruptcy, distrain upon the goods or effects of the bankrupt for the rent due to him from the bankrupt with this limitation that, where distress for rent be 435 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] levied after the commencement of the bankruptcy it shall be available only for six month’s rent accrued due prior to the date of the order of adjudication and shall not be available for rent payable in respect of any period subsequent to the date when the distress was levied, but the landlord or other person to whom the rent may be due from the bankrupt may prove under the bankruptcy for the surplus due for which the distress may not have been available. Postponement of claims by relatives Ords. Nos. 45 of 1947 s. 13 20 of 1958 s. 13 - 41 Verify source ↗
Postponement of claims by relatives
AI-assisted research summary: A relative of a debtor cannot claim as a creditor for certain claims until the other creditors’ claims for value have been paid.
41. Where a receiving order has been made against a debtor, a relative by consanguinity or affinity of the debtor who has a claim against the debtor for salary or wages due or in respect of any money or other estate lent or entrusted to the debtor shall not be entitled to claim as a creditor in respect thereof until the claims of the others creditors for valuable consideration or money’s worth have been satisfied. Relation back to trustee’s title (b) Property Available for Payment of Debts - 42 Verify source ↗
Relation back to trustee’s title
AI-assisted research summary: This section says when a debtor’s bankruptcy is treated as starting for legal purposes, depending on the relevant bankruptcy order or act of bankruptcy.
42.–(1) The bankruptcy of a debtor, whether it takes place on the debtor’s own petition or upon that of a creditor or creditors shall be deemed to have relation back to, and to commence at the time of the act of bankruptcy being committed on which a receiving order is made against him, or, where the bankrupt is proved to have committed more acts of bankruptcy than one, to have relation back to and commence at the time of the first of the acts of bankruptcy proved to have been committed by the bankrupt within three months next preceding, the date of the presentation of the bankruptcy petition; but a bankruptcy petition, receiving order or adjudication shall not be rendered invalid by reason of any act of bankruptcy anterior to the debt of the petitioning creditor. (2) Where a receiving order is made against the judgment debtor in pursuance of section 102, the bankruptcy of the debtor shall be deemed to have relation back to, and to commence at the time of the order, or where the bankrupt is proved to have committed any previous act of bankruptcy, then to have relation 436 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Description of bankrupt’s property divisible amongst creditors Ord. No. 20 of 1958 s. 14 back to, and to commence at the time of the first of the acts of bankruptcy proved to have been committed by the debtor within three months next preceding the date of the order. - 43 Verify source ↗
Description of bankrupt’s property divisible amongst creditors
AI-assisted research summary: Bankrupt property divisible among creditors excludes trust property and certain tools, clothing, and bedding up to 500 shillings, though the court may raise that allowance up to 1,000 shillings.
43. The property of the bankrupt divisible amongst the creditors, and in this Act referred to as the property of the bankrupt, shall not comprise the following particulars: (a) property held by the bankrupt on trust for any other person; and (b) the tools (if any) of trade and the necessary wearing apparel and bedding including his wife and children, to a value inclusive of tools and apparel and bedding, not exceeding five hundred shillings in the whole, except that in any case the court having regard to the bankrupt’s station in life, may in its discretion order that this allowance be increased to any value not exceeding one thousand shillings in the whole: But it shall comprise the following particulars: (i) property as may belong to or be vested in the bankrupt at the commencement of the bankruptcy, or may be acquired by or devolve on him before his discharge; (ii) the capacity to exercise and take proceedings for exercising the powers in or over or in respect of property as might have been exercised by the bankruptcy for his own benefit at the commencement of his bankruptcy or before his discharge; and (iii) goods, being at the commencement of the bankruptcy in the possession, order or disposition of the bankrupt, in his trade or business, by the consent and permission of the true owner under the circumstances that he is the reputed owner thereof: Provided that, things in action other than debts due or growing due to the bankrupt in the course of his trade or business shall not be deemed goods within the meaning of this section. 437 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Provisions as to second bankruptcy - 44 Verify source ↗
Provisions as to second bankruptcy
AI-assisted research summary: In a second or later bankruptcy proceeding, the previous trustee is treated as a creditor for unpaid provable debts, and the current trustee must hold and then transfer certain later-acquired property when the provision applies.
44.–(1) Where a second or subsequent receiving order is made against a bankrupt, or where an order is made for the administration in bankruptcy of the estate of a deceased bankrupt, then for the purposes of any proceedings consequent upon any order, the trustee in the last preceding bankruptcy shall be deemed to be a creditor in respect of any unsatisfied balance of the debts provable against the property of the bankrupt in that bankruptcy. (2) In the event of a second or subsequent receiving order made against a bankrupt being followed by an order adjudging him bankrupt, or in the event of an order being made for the administration in bankruptcy of the estate of a deceased bankrupt, any property acquired by him since he was last adjudged bankrupt, which at the date when the subsequent petition was presented had not been distributed amongst the creditors in the last preceding bankruptcy, shall (subject to any disposition thereof made by the official receiver or trustee in that bankruptcy, without knowledge of the presentation of the subsequent petition, and subject to the provisions of section 52) vest in the trustee in the subsequent bankruptcy or administration in bankruptcy as the case may be. (3) Where the trustee in any bankruptcy receives notice of a subsequent petition in bankruptcy against the bankrupt or after his decease of a petition for the administration of his estate in bankruptcy, the trustee shall hold any property in his possession which has been acquired by the bankrupt since he was adjudged bankrupt until the subsequent petition has been disposed of, and, where on the subsequent petition an order of the administration of the estate in bankruptcy is made, he shall transfer the property or the proceeds thereof (after deducting his costs and expenses) to the trustee in the subsequent bankruptcy or administration in bankruptcy, as the case may be. 438 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Restriction of rights of creditor under execution or attachment Duties of bailiff as to goods taken in execution (c) Effect of Bankruptcy of Antecedent and Other Transactions - 45 Verify source ↗
Restriction of rights of creditor under execution or attachment
AI-assisted research summary: A creditor may lose the benefit of execution or attachment against a debtor’s trustee in bankruptcy unless the process was completed before the receiving order and before notice of relevant bankruptcy events.
45.–(1) Where a creditor has issued execution against the goods or lands of a debtor, or has attached any debt due to him, he shall not be entitled to retain the benefit of the execution or attachment against the trustee in bankruptcy of the debtor, unless he has completed the execution or attachment before the date of the receiving order, and before notice of the presentation of any bankruptcy petition by or against the debtor or of the commission of any available act of bankruptcy by the debtor. (2) For the purposes of this Act, an execution against goods is completed by seizure and sale; an attachment of a debt is completed by receipt of the debt; and an execution against land is completed by seizure, or, in the case of an equitable interest, by the appointment of a receiver. (3) An execution levied by seizure and sale on the goods of a debtor is not invalid by reason only of its being an act of bankruptcy, and a person who purchases the goods in good faith under a sale by the bailiff shall acquire a good title to them against the trustee in bankruptcy. - 46 Verify source ↗
Duties of bailiff as to goods taken in execution
AI-assisted research summary: A bailiff must deliver certain seized goods or money to the official receiver if a receiving order is made, and must handle execution proceeds and balances as stated; the section also protects purchasers and some claims to the goods.
46.–(1) Where goods of a debtor are taken in execution, and before the sale thereof, or the completion of the execution by the receipt or recovery of the full amount of the levy, notice is served on the bailiff that, a receiving order has been made against the debtor, the bailiff shall, on request, deliver the goods and any money seized or received in part satisfaction of the execution to the official receiver, but the costs of the execution shall be a first charge on the goods or money delivered, and the official receiver or trustee may sell the goods, or an adequate part thereof, for the purpose of satisfying the charge. (2) Where, under an execution in respect of a judgment for a sum exceeding four hundred shillings, the goods of a debtor are sold or money is paid in order to avoid sale, the bailiff shall deduct his costs of the execution from the proceeds of sale or the money paid, and retain the balance for fourteen days, and where 439 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] within that time notice is served on him of a bankruptcy petition having been presented by or against the debtor, and a receiving order is made against the debtor thereon or on any other petition of which the bailiff has notice, the bailiff shall pay the balance to the official receiver, or, as the case may be, to the trustee, who shall be entitled to retain it as against the execution creditor. (3) Where goods in the possession of an execution debtor at the time of seizure by a bailiff are sold by the bailiff without any claim having been made to the same, the purchaser of the goods sold shall acquire a good title to the goods, and a person shall not be entitled to recover against the bailiff or any other person lawfully acting under his authority, for any sale of the goods or for paying over the proceeds thereof prior to the receipt of a claim to the goods, unless it is proved that, the person from whom recovery is sought had notice, or might by making reasonable inquiry have ascertained that, the goods were not the property of the execution debtor: Provided that, this subsection shall not affect the right of any claimant who may prove that, at the time of sale he had a title to the goods and to any remedy to which he may be entitled against any person other than the bailiff.
Part
part thereof, for the purpose of satisfying the charge.
- 47 Verify source ↗
Avoidance of certain settlements
AI-assisted research summary: Certain property settlements and related marriage covenants can be void against the bankruptcy trustee if bankruptcy happens within specified time limits, unless the required solvency proof is made.
47.–(1) A settlement of property, not being a settlement before and in consideration of marriage, or made in favour of a purchaser or incumbrancer in good faith and for valuable consideration or a settlement made on or for the wife or children of the settlor of property which has accrued to the settlor after marriage in right of his wife, where the settlor becomes bankrupt within two years after the date of the settlement, shall be void against the trustee in the bankruptcy, and where the settlor becomes bankrupt at any subsequent time within ten years after the date of the settlement, shall be void against the trustee in the bankruptcy, unless the parties claiming under the settlement can prove that, the settlor was, at the time of making the settlement, able to pay his debts without the aid of the property comprised in the settlement, 440 Avoidance of certain settlements ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] and the interest of the settlor in the property passed to the trustee of the settlement on the execution thereof. (2) A covenant or contract made by any person (hereinafter called the settlor) in consideration of his or her marriage, either for the future payment of money for the benefit of then settlor’s spouse, or children, or for the future settlement on or for the settlor’s spouse, or children, of property, wherein the settlor had not at the date of the marriage any estate or interest, whether vested or contingent, in possession or remainder, and not being money or property in right of the settlor’s spouse, shall, where the settlor is adjudged bankrupt and the covenant or contract has not been executed at the date of the commencement of his bankruptcy, be void against the trustee in the bankruptcy, except so far as it enables the person entitled under the covenant or contract to claim for dividend in the settlor’s bankruptcy under or in respect of the covenant or contract, but any claim to dividend shall be postponed until claims of the other creditors for valuable consideration in money’s worth have been satisfied. (3) A payment of money (not being payment of premiums on a policy of life assurance) or any transfer of property made by the settlor in pursuance of a covenant or contract as aforesaid shall be void against the trustee in the settlor’s bankruptcy unless the persons to whom the payment or transfer was made proved either that- (a) the payment or transfer was made more than two years before the date of the commencement of the bankruptcy; (b) at the date of the payment or transfer the settlor was able to pay his debts without the aid of the money paid or the property transferred; or (c) the payment or transfer was made in pursuance of a covenant or contract to pay or transfer money or property expected to come to the settlor from or on the death of a particular person named in the covenant or contract and was made within three months after the money or property came into the possession or under the control 441 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Avoidance of unregistered assignments of debts Ord. No. 45 of 1947 s. 14 Cap. 210 Avoidance of preference in certain cases Ord. No. 45 of 1947 s. 15 of the settlor, but, in the event of any payment or transfer being declared void, the persons to whom it was made shall be entitled to claim for dividend under or in respect of the covenant or contract in like manner as if it had not been executed at the commencement of the bankruptcy. (4) “Settlement” shall for the purposes of this section, include any conveyance or transfer of property. - 48 Verify source ↗
Avoidance of unregistered assignments of debts
AI-assisted research summary: If a person assigns existing or future debts to another person, section 13 of the Chattels Transfer Act applies.
48. Where a person makes an assignment, whether by way of security or otherwise, to any other person of any existing or future debts owing or to become owing to him, or any class of debts, the provisions of section 13 of the Chattels Transfer Act, shall apply. - 49 Verify source ↗
Avoidance of preference in certain cases
AI-assisted research summary: Certain pre-bankruptcy transfers, payments, obligations, and proceedings made to prefer one creditor over others can be treated as fraudulent and void against the bankruptcy trustee if bankruptcy follows within six months.
49.–(1) A conveyance or transfer of property or charge thereon made, a payment made, an obligation incurred, and a judicial proceeding taken or suffered by a person unable to pay his debts as they become due from his own money in favour of any creditor, or of any person in trust for any creditor, with a view of giving the creditor, or any surety or guarantor for the debt due to the creditor, a preference over the other creditors, shall where the person making, taking, paying or suffering the same is adjudged bankrupt on a bankruptcy petition presented within six months after the date of making, taking, paying or suffering the same, be deemed fraudulent and void as against the trustee in the bankruptcy. (2) This section shall not affect the rights of a person making title in good faith and for valuable consideration through or under a creditor of the bankrupt. (3) Where a receiving order is made against a judgment debtor in pursuance of section 102, this section shall apply as if the debtor had been adjudged bankrupt on a bankruptcy petition presented at the date of the receiving order. Protection of bona fide transitions without notice - 50 Verify source ↗
Protection of bona fide transitions without notice
AI-assisted research summary: Certain bankrupt-related payments and transactions are not invalidated if they happened before the receiving order and the other party had no notice of an available act of bankruptcy.
50. Subject to the foregoing provisions of this Act with respect to the effect of bankruptcy on an execution or attachment, and with respect to the avoidance of certain settlements, 442 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] assignments and preferences, this Act shall not invalidate, in the case of a bankruptcy- (a) payment by the bankrupt to any of his creditors; (b) payment or delivery to the bankrupt; (c) conveyance or assignment by the bankrupt for valuable consideration; and (d) contract, dealing, or transaction by or with the bankrupt for valuable consideration: Provided that, both the following conditions are complied with, namely that the- (i) a payment, delivery, conveyance, assignment, contract, dealing or transaction, as the case may be, takes place before the date of the receiving order; and (ii) a person (other than the debtor) to, by, or with whom the payment, delivery, conveyance, assignment, contract, dealing, or transaction was made, executed, or entered into has not at the time of the payment, delivery, conveyance, assignment, contract, dealing, or transaction, notice of any available act of bankruptcy committed by the bankrupt before that time. Validity of certain payments to bankrupt and assignee - 51 Verify source ↗
Validity of certain payments to bankrupt and assignee
AI-assisted research summary: A payment or delivery made before the receiving order, without notice of a bankruptcy petition, and in the ordinary course of business or bona fide, counts as a good discharge.
51. A payment of money or delivery of property to a person subsequently adjudged bankrupt, or to a person claiming, by assignment from him notwithstanding anything in this Act, shall be a good discharge to the person paying the money or delivering the property, where the payment or delivery is made before the actual date on which the receiving order is made and without notice of the presentation of a bankruptcy petition, and is either pursuant to the ordinary course of business or otherwise bona fide. Dealings with undischarged bankrupt - 52 Verify source ↗
Dealings with undischarged bankrupt
AI-assisted research summary: A banker who learns an account holder is an undischarged bankrupt must promptly tell the trustee or official receiver and must not pay money out of the account except as allowed.
52.–(1) The transactions by a bankrupt with a person dealing with him bona fide and for value, in respect of property, whether movable or immovable, acquired by the bankrupt after’ the adjudication, where completed before any intervention by 443 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] the trustee, shall be valid against the trustee, and any estate or interest in the property which by virtue of this Act is vested in the trustee shall determine and pass in a manner and to the extent as may he required for giving effect to any transaction. (2) For the purposes of subsection (1), the receipt of any money, security or negotiable instrument from, or by the order or direction of a bankrupt by his banker, and any payment and any delivery of any security or negotiable instrument made to, or by the order or direction of a bankrupt by his banker, shall be deemed to be a transaction by the bankrupt with the banker dealing with him for value. (3) Where a banker has ascertained that, a person having an account with him is an undischarged bankrupt, then, unless the banker is satisfied that, the account is on behalf of some other person, it shall be his duty forthwith to inform the trustee in the bankruptcy or the official receiver of the existence of the account, and thereafter he shall not make any payments out of the account, except under an order of the court or in accordance with instructions from the trustee in the bankruptcy, unless by the expiration of one month from the date giving the information, an instructions have not been received from the trustee or the official receiver. (d) Realisation of Property - 53 Verify source ↗
Possession of property by trustee
AI-assisted research summary: The trustee must promptly take possession of the bankrupt’s documents and movable property, and can seek court help to secure or keep that property.
53.–(1) The trustee shall, as soon as may be, take possession of the deeds, books, and documents of the bankrupt, and other parts of his property capable of manual delivery. (2) The trustee shall, in relation to and for the purpose of acquiring or retaining possession of the property of the bankrupt, be in the same position as if he were a receiver of the property appointed by the court, and the court may, on his application, enforce the acquisition or retention accordingly. (3) Where any part of the property of the bankrupt consists of stock, shares in ships, shares, or any other property transferable in the books of any company, office, or person, the trustee may exercise the right to transfer the property to the 444 Possession of property by trustee ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] same extent as the bankrupt might have exercised it if he had not become bankrupt. (4) Where any part of the property of the bankrupt consists of things in action, the things shall be deemed to have been duly assigned to the trustee. (5) Subject to the provisions of this Act with respect to property acquired by a bankrupt after adjudication, any treasurer or other officer, or any banker, attorney, or agent of a bankrupt, shall pay and deliver to the trustee money and securities in his possession or power, as the officer, banker, attorney, or agent, which is not by law entitled to retain as against the bankrupt or the trustee and where he does not, he shall be guilty of a contempt of court, and may be punished accordingly on the application of the trustee. - 54 Verify source ↗
Seizure of property of bankrupt
AI-assisted research summary: A court-warrant holder may seize a bankrupt’s or relevant debtor’s property, break open places to find it, and the court may issue a search warrant for police or court officers to execute.
54. A person acting under warrant of the court may seize any part of the property of a bankrupt or of a debtor against whom a receiving order has been made, in the custody or possession of the bankrupt or the debtor, or of any other person, and with a view to the seizure, may break open any house building or room of the bankrupt or the debtor, where the bankrupt or the debtor is supposed to be, or any building or receptacle of the bankrupt or the debtor where any of his property is supposed to be, and where the court is satisfied that, there is reason to believe that property of a bankrupt, or of a debtor against whom a receiving order has been made, is concealed in a house or place not belonging to him, the court may, where it thinks fit, grant a search warrant to any police officer or officer of the court, who may execute it according to its tenor. Seizure of property of bankrupt Appropriation of proportion of pay or salary to creditors Ords. Nos. 45 of 1947 s. 6; 20 of 1958 s. 15
Part
part of the property of a bankrupt or of a debtor against whom
- 55 Verify source ↗
Appropriation of proportion of pay or salary to creditors
AI-assisted research summary: If a bankrupt is a public servant, armed forces officer, or employee, the court can order part of their pay, salary, income, or wages to be paid to the trustee for creditors.
55.–(1) Where a bankrupt is an officer of the army, navy or air force, or an officer or clerk or otherwise employed or engaged in the civil service of the United Republic, the trustee shall receive for distribution amongst the creditors the bankrupt’s pay or salary as the court, on application of the trustee, with the consent of the head of the department under which the pay or salary is enjoyed, may direct and before making any order 445 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] under this subsection, the court shall communicate with the head of the department as to the amount, time, and manner of the payment to the trustee, and obtain the written consent of the head of the department to the terms of the payment. (2) Where a bankrupt is in receipt of a salary or income other than as aforesaid, the court, on the application of the trustee, shall make order as it thinks just for the payment of the salary or income, or of any part thereof, to the trustee to be applied by him in a manner as the court may direct. (3) Where a bankrupt is an employee and earning wages, irrespective of whether payment of the wages is made by the day or any other period of time, the court, on the application of the trustee, shall make an order as it thinks just for the payment of any part of the wages to the trustee to be applied by him in a manner as the court may direct. (4) An order made under subsection (1) of this section shall be served upon the bankrupt and upon the head of department, and the order made under subsection (2) or (3) of this section shall be served upon the bankrupt and may, at any time after the making thereof, be served upon the person by whom the salary or income of the bankrupt is paid or upon the bankrupt’s employer, as the case may be; and where any order as aforesaid is served upon the head of department, the person paying the salary or income or the employer, as the case may be, the amounts of pay, salary, income or wages specified in the order shall thereafter be paid to the trustee in conformity with the terms thereof. (5) This section shall not take away or abridge any power of the President to dismiss a bankrupt. Appropriation of income of property restrained from anticipation Ord. No. 45 of 1947 s. 17 - 56 Verify source ↗
Appropriation of income of property restrained from anticipation
AI-assisted research summary: If a bankrupt married woman’s income is subject to a restraint on anticipation, the court may order some or all of that income to be paid to the trustee for creditors, and it must consider the woman’s and her children’s means of subsistence.
56. Where a married woman who has been adjudged bankrupt has property, the income of which is subject to a restraint on anticipation, the court shall have power, on the application of the trustee, to order that, during the time as the court may order, the whole or some part of the income be paid to the trustee for distribution amongst the creditors, and in the exercise of the power, the court shall have regard to the means of subsistence available for the woman and her children. 446 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Vesting and transfer of property Disclaimer of onerous property - 57 Verify source ↗
Vesting and transfer of property
AI-assisted research summary: Until a trustee is appointed, the official receiver acts as trustee. When bankruptcy happens, the bankrupt’s property vests in the trustee, and later transfers to any appointed trustee without a conveyance or assignment.
57.–(1) Until a trustee is appointed, the official receiver shall be the trustee for the purposes of this Act, and, immediately on a debtor being adjudged bankrupt, the property of the bankrupt shall vest in the trustee. (2) On the appointment of a trustee, the property shall forthwith pass to and vest in the trustee appointed. (3) The property of the bankrupt shall pass from trustee to trustee, including under that term the official receiver when he fills the office of trustee, and vest in the trustee for the time being during his continuance in office, without any conveyance, assignment, or transfer whatsoever. (4) The certificate of appointment of a trustee shall for the purposes of any law in force in any part of Tanzania requiring registration or recording of conveyances or assignments of property, be deemed to be a conveyance or assignment of property, and may be registered and recorded accordingly. - 58 Verify source ↗
Disclaimer of onerous property
AI-assisted research summary: A trustee may disclaim certain bankrupt property by signed writing within the stated time limits, and the court controls some lease and vesting matters.
58.–(1) Where any part of the property of the bankrupt consists of land of any tenure burdened with onerous covenants of shares or stock on companies of unprofitable contracts, or of any other property that is unsaleable, or not readily saleable by reason of its binding the possessor thereof to the performance of any onerous act, or to the payment of any sum of money, the trustee, notwithstanding that he has endeavoured to sell or has taken possession of the property, or exercised any act of ownership in relation thereto, but subject to the provisions of this section, may, by writing signed by him, at any time within twelve months after the first appointment of a trustee or extended period as may be allowed by the court, disclaim the property: Provided that, where any property has not come to the knowledge of the trustee within one month after the appointment, he may disclaim the property at any time within twelve months after he has become aware thereof or the extended period as may be allowed by the court. 447 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (2) The disclaimer shall operate to determine, as from the date of disclaimer, the rights, interests, liabilities of the bankrupt and his property in or in respect of the property disclaimed, and also discharge the trustee from personal liability in respect of the property disclaimed as from the date when the property was vested in him, but shall not, except so far as is necessary for the purpose of releasing the bankrupt and his property and the trustee from liability, affect the rights or liabilities of any other person. (3) A trustee shall not be entitled to disclaim a lease without the leave of the court, except in any case which may be prescribed by general rules, and the court may, before or on granting the leave, require the notices to be given to persons interested, and impose terms as a condition of granting leave, and make orders with respect to fixtures, tenant’s improvements, and other matters arising out of the tenancy, as the court thinks just. (4) The trustee shall not be entitled to disclaim any property in pursuance of this section in any case where an application in writing has been made to the trustee by any person interested in the property, requiring him to decide whether he will disclaim or not, and the trustee has for a period of twenty- eight days after the receipt of the application, or extended period as may be allowed by the court, declined or neglected to give notice whether he disclaims the property or not; and, in the case of a contract, where the trustee, alter the application as aforesaid, does not within the said period or extended period disclaim the contract, he shall be deemed to have adopted it. (5) The court may, on the application of any person who against the trustee, entitled to the benefit or subject to the burden of a contract made with the bankrupt, make an order rescinding the contract on the terms as to payment by or to either party of damages for the non- performance of the contract, or otherwise, as to the court may seem equitable and any damages payable under the order to any person may be proved by him as a debt under the bankruptcy. 448 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (6) The court may, on application by any person either claiming any interest in any disclaimed property or under any liability not discharged by this Act in respect of any disclaimed property, and on hearing the persons as it thinks fit, make an order for the vesting of the property in or delivery thereof to any person entitled thereto, or to whom it may seem just that the same should be delivered by way of compensation for the liability as aforesaid, or a trustee for him, and on the terms as the court thinks just; and on any vesting order being made, the property comprised therein shall vest accordingly in the person therein named in that behalf without any conveyance or assignment for the purpose: Provided that, where the property disclaimed is of a leasehold nature, the court shall not make a vesting order in favour of any person claiming under the bankrupt, whether as under lessee or as mortgagee by demise, except upon the terms of making that persons- (a) subject to the same liabilities and obligations as the bankrupt was subject to under the lease in respect of the property at the date when the bankruptcy petition was filed; or (b) where the court thinks fit, subject only to the same liabilities and obligations as if the lease had been assigned to that person at that date, and in either event (if the case so requires) as if the lease had comprised only the property comprised in the vesting order; and any mortgagee or under lessee declining to accept a vesting order upon the terms shall be excluded from the interest in and security upon the property, and, where there is no person claiming under the bankrupt who is willing to accept an order upon the terms, the court shall have power to vest the bankrupt’s estate and interest in the property in any person liable either personally or in a representative character, and either alone or jointly with the bankrupt to perform the lessee’s covenants in the lease, freed and discharged from estates, incumbrances, and interests created therein by the bankrupt. 449 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Powers of trustee to deal with property (7) Where, on the release, removal, resignation or death of a trustee in bankruptcy, an official receiver is acting as trustee, he may disclaim any property which might be disclaimed by a trustee under the foregoing provisions, notwithstanding that, the time prescribed by this section for the disclaimer has expired, but the power of disclaimer shall be exercisable only within twelve months after the official receiver has become trustee in the circumstances aforesaid, or has become aware of the existence of the property, whichever period may last expire. (8) A person injured by the operation of a disclaimer under this section shall be deemed to be a creditor of the bankrupt to the extent of the injury, and may accordingly prove the same as a debt under the bankruptcy. - 59 Verify source ↗
Powers of trustee to deal with property
AI-assisted research summary: The trustee may, subject to this Act, sell bankrupt property, give receipts, claim dividends, use vested powers and instruments, and deal with certain tenant-in-tail property.
59. Subject to the provisions of this Act, the trustee may do all or any of the following things: (a) sell all or any part of the property of the bankrupt (including the goodwill of the business, with any, and the book debts due or growing due to the bankrupt), by public auction or private contract, with power to transfer the whole thereof to any person or company, or to sell the same in parcels; (b) give receipts for any money received by him, which receipts shall effectually discharge the person paying the money from the responsibility in respect of the application thereof; (c) prove, rank, claim, and draw a dividend in respect of any debt due to the bankrupt; (d) exercise any powers, the capacity to exercise which is vested in the trustee under this Act, and execute any powers of attorney, deeds and other instruments, for the purpose of carrying into effect the provisions of this Act; or (e) deal with any property to which the bankrupt is beneficially entitled as tenant in tail in the same manner as the bankrupt might have dealt with it. 450 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Powers exercisable by trustee with permission of committee of inspection - 60 Verify source ↗
Powers exercisable by trustee with permission of committee of inspection
AI-assisted research summary: A trustee may do certain bankruptcy-administration acts only with permission from the committee of inspection.
60.–(1) The trustee may, with the permission of the committee of inspection, do all or any of following things: (a) carry on the business of the bankrupt, so far as may be necessary for the beneficial winding up of the same; (b) bring, institute, or defend any action or other legal proceeding relating to the property of the bankrupt; (c) employ an advocate or other agent to take any proceedings or do any business which may be sanctioned by the committee of inspection; (d) accept as the consideration for the sale of any property of the bankrupt, a sum of money payable at a future time subject to the stipulations as to security and otherwise as the committee think fit; (e) mortgage or pledge any part of the property of the bankrupt for the purpose of raising money for the payment of his debts; (f) refer any dispute to arbitration, compromise any debts, claims and liabilities, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist between the bankrupt and any person who may have incurred any liability to the bankrupt on the receipt of the sums payable at the times, and generally on terms as may be agreed on; (g) make compromise or other arrangement as may be thought expedient with creditors, or person claiming to be creditors, in respect of any debts provable under the bankruptcy; (h) make compromise or other arrangement as may be thought expedient with respect to any claim arising out of or incidental to the property of the bankrupt, made or capable of being made on the trustee by any person or by the trustee on any person; or (i) divide in its existing form amongst the creditors, its estimated value, any property according to advantageously sold which from its peculiar nature of other special circumstances cannot be readily or advantageously sold. 451 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (2) The permission given for the purpose of this section shall not be a general permission to do all or any of the above mentioned things, but shall only be a permission to do the particular thing or things for which permission is sought in the specified case or cases. Power to allow bankrupt to manage property - 61 Verify source ↗
Power to allow bankrupt to manage property
AI-assisted research summary: The trustee may, with permission from the committee of inspection, appoint the bankrupt to help manage the bankrupt’s property or carry on the bankrupt’s trade for creditors’ benefit.
61. The trustee with the permission of the committee of inspection may appoint the bankrupt himself to superintend the management of the property of the bankrupt or of any part thereof, or to carry on the trade (if any) of the bankrupt for the benefit of his creditors, and in any other respect, to aid in administering the property in a manner and on terms as the trustee may direct. Allowance to bankrupt for maintenance or service Right of trustee to inspect goods pawned, etc. Limitation of trustee’s powers in relation to copyright - 62 Verify source ↗
Allowance to bankrupt for maintenance or service
AI-assisted research summary: A trustee may, with the committee of inspection’s permission, make a fair allowance to a bankrupt for support or services, and the court may reduce that allowance.
62. The trustee may with the permission of the committee of inspection, make allowance as he may think just to the bankrupt out of his property for the support of the bankrupt and his family, or in consideration of his services where he is engaged in winding up his estate, but the allowance may be reduced by the court. - 63 Verify source ↗
Right of trustee to inspect goods pawned, etc
AI-assisted research summary: The official receiver or trustee may inspect pledged, pawned, or otherwise secured goods after written notice, and the security holder cannot realise the security until the trustee gets a reasonable chance to inspect and decide on redemption.
63. Where goods of debtor against whom a receiving order has been made are held by any person by way of pledge, pawn or other security, it shall be lawful for the official receiver or trustee, after giving notice in writing of his intention to do so, to inspect the goods, and where the notice has been given, the person as aforesaid shall not be entitled to realise his security until he has given the trustee a reasonable opportunity of inspecting the goods and of exercising his right of redemption where he thinks fit to do so. - 64 Verify source ↗
Limitation of trustee’s powers in relation to copyright
AI-assisted research summary: A trustee cannot sell or license copyright-related rights in a bankrupt’s work unless the author is paid the required royalties or profit share, and some transfers need the author’s or court’s consent.
64. Where the property of a bankrupt comprises the copyright in any work or any interest in the copyright, and he is liable to pay to the author of the work royalties or a share of the profits in respect thereof, the trustee shall not be entitled to sell, or authorise the sale of any copies of the work, or to perform or authorise the performance of the work, except on the terms of paying to the author, the sums by way of royalty or share of the 452 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Protection of official receiver and trustee from personal liability in certain cases Declaration and distribution of dividends profits as would have been payable by the bankrupt, nor shall he, without the consent of the author or of the court, be entitled to assign the right or transfer the interest or to grant interest in the right by licence, except upon terms which will secure to the author payments by way of royalty or share of the profits at rate not less than that which the bankrupt was liable to pay. - 65 Verify source ↗
Protection of official receiver and trustee from personal liability in certain cases
AI-assisted research summary: The official receiver or trustee is generally not personally liable for loss, damage, or claim costs if goods were seized or sold without notice of a claim and later turn out not to have been the debtor’s property, unless the court finds negligence.
65. Where the official receiver or trustee has seized or disposed of any goods, chattels, property, or other effects in the possession or on the premises of a debtor against whom a receiving order has been made, without notice of any claim by any person in respect of the same, and it is thereafter made to appear that, the said goods, chattels, property, or other effects were not, at the date of the receiving order the property of the debtor, the official receiver or trustee shall not be personally liable for any loss or damage arising from the seizure or disposal sustained by any person claiming the property, nor for the costs of any proceeding taken to establish a claim thereto, unless the court is of opinion that, the official receiver or trustee has been guilty of negligence in respect of the same. (e) Distribution of Property - 66 Verify source ↗
Declaration and distribution of dividends
AI-assisted research summary: The trustee must distribute dividends to creditors who have proved their debts, and give notice before and after declaring a dividend.
66.–(1) Subject to the retention of sums as may be necessary for the costs of administration, or otherwise, the trustee shall, with convenient speed, declare and distribute dividends amongst the creditors who have proved their debts. (2) The first dividend, if any, shall be declared and distributed within four months after the conclusion of the first meeting of creditors unless the trustee satisfies the committee of inspection that, there is sufficient reason for postponing the declaration to a later date. (3) Subsequent dividends shall, in the absence of sufficient reason to the contrary, be declared and distributed at intervals of not more than six months. (4) Before declaring a dividend, the trustee shall cause notice of his intention to do so to be gazetted in the prescribed 453 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Joint and separate dividends Provisions for creditors residing at distance etc. manner, and send reasonable notice thereof to each creditor mentioned in the bankrupt’s statement who has not proved his debt. (5) When the trustee has declared a dividend, he shall send to each creditor who has proved a notice, showing the amount of the dividend and when and how it is payable, and a statement in the prescribed form as to the particulars of the estate. - 67 Verify source ↗
68. Provisions for creditors residing at distance etc
AI-assisted research summary: When a partner is bankrupt, certain joint creditors cannot take dividends from the bankrupt’s separate property until separate creditors are paid in full.
67.–(1) Where one partner of a firm is adjudged bankrupt, a creditor to whom the bankrupt is indebted jointly with the other partners of the firm, or any of them, shall not receive any dividend out of the separate property of the bankrupt until the separate creditors have received the full amount of their respective debts. (2) Where joint and separate properties are being administered, dividends of the joint and separate properties shall, unless otherwise directed by the court on the application of any person interested, be declared together, and the expenses of and incidental to the dividends shall be fairly apportioned by the trustee between the joint and separate properties, regard being had to the work done for and the benefit received by each property. - 68 Verify source ↗
Provisions for creditors residing at distance etc
AI-assisted research summary: The trustee must make provision for certain bankruptcy debts, disputed claims, and administration expenses before distributing dividends.
68.–(1) In the calculation and distribution of a dividend, the trustee shall make provision for debts provable in bankruptcy appearing from the bankrupt’s statements, or otherwise, to be due to persons resident in places so distant from the place where the trustee is acting and in the ordinary course of communication, they have not had sufficient time to tender their proofs, or to establish them, if disputed, and also for debts provable in bankruptcy the subject of claims not yet determined. (2) The trustee shall also make provision for any disputed proofs, claims, and expenses necessary for the administration of the estate or otherwise. (3) Subject to the foregoing provisions, the trustee shall distribute as dividend, money in hand. 454 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Right of creditor who has not proved debt before declaration of dividend Interest on debts Ord. No. 20 of 1958 s. 16 - 69 Verify source ↗
Right of creditor who has not proved debt before declaration of dividend
AI-assisted research summary: A creditor who proved late can still be paid from money held by the trustee for dividends not yet received, but cannot upset a dividend already declared before the debt was proved.
69. A creditor who has not proved his debt before the declaration of any dividend or dividends shall be entitled to be paid out of any money for the time being in the hands of the trustee, any dividend or dividends he may have failed to receive before that money is applied to the payment of any future dividend or dividends, but he shall not be entitled to disturb the distribution of any dividend declared before his debt was proved by reason that, he has not participated therein. - 70 Verify source ↗
71. Final dividend
AI-assisted research summary: When a debt proved in bankruptcy includes interest, the dividend calculation uses interest capped at 6% per year, subject to the creditor’s separate right to any higher interest after proved debts are paid in full.
70.–(1) Where a debt has been proved, and the debt includes interest, or any pecuniary consideration in lieu of interest, the interest or consideration shall, for the purposes of dividend, be calculated at a rate not exceeding six per centum per annum, without prejudice to the right of a creditor to receive out of the estate any higher rate of interest to which he may be entitled after the debts proved in the estate have been paid in full. (2) In dealing with the proof of the debt, the following rules shall be observed- (a) account settled between the debtor and the creditor within three years preceding the date of the receiving order may be examined, and where it appears that the settlement of the account forms substantially one transaction with any debt alleged to be due out of the debtor’s estate (whether in the form of renewal of a loan or capitalisation of interest or ascertainment of loans or otherwise), the accounts may be re- opened and the whole transaction treated as one; (b) payments made by the debtor to the creditor before the receiving order, whether by way of bonus or otherwise, and any sums received by the creditor before the receiving order from the realisation of any security for the debt, shall, notwithstanding any agreement to the contrary, be appropriated to principal and interest in the proportion that the principal bears to the sum payable as interest at the agreed rate; and 455 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (c) where the debt due is secured and the security is realised after the receiving order, or the value thereof is assessed in the proof, the amount realised or assessed shall be appropriated to the satisfaction of principal and interest in the proportion that, the principal bears to the sum payable as interest at the agreed rate. - 71 Verify source ↗
Final dividend
AI-assisted research summary: The trustee must declare a final dividend after realising the bankrupt property enough to avoid needless delay, and must notify persons whose claims are not yet established. After the notice period, the bankrupt property is divided among creditors who have proved their debts.
71.–(1) When the trustee has realised that, the property of the bankrupt, or so much thereof as can, in the joint opinion of himself and of the committee of inspection, be realised without needlessly protracting the trusteeship, he shall declare a final dividend, but before so doing he shall give notice in a manner prescribed to the persons whose claims to the creditors have been notified to him, but not established to his satisfaction, that where they do not establish their claims to the satisfaction of the court within a time limited by the notice, he will proceed to make a final dividend, without regard to their claims. (2) After the expiration of the time so limited, or, where the court on application by any claimant grants him further time for establishing his claim, then on the expiration of further time, the property of the bankrupt shall be divided among the creditors who have proved their debts, without regard to the claims of any other persons. - 72 Verify source ↗
Action for dividend
AI-assisted research summary: An action for dividend cannot be brought against the trustee, except when the trustee refuses to pay a dividend and the court decides to act.
72. An action for dividend shall not be instituted against the trustee, but, where the trustee refuses to pay any dividend, the court may, where it thinks fit, order him to pay it, and also to payout of his own money interest thereon for the time that it is withheld, and the costs of the application. Final dividend Action for dividend Right of bankrupt to surplus - 73 Verify source ↗
Right of bankrupt to surplus
AI-assisted research summary: The bankrupt is entitled to any surplus left after creditors, interest, and the costs of the bankruptcy proceedings are fully paid.
73. The bankrupt shall be entitled to any surplus remaining after payment in full of his creditors, with interest, as by this Act provided, and of the costs, charges, and expenses of the proceedings under the bankrupt petition. 456 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Appointment of official receiver and deputy official receivers Act No. 1 of 2018 s. 5 GN. No. 478 of 1962 Status of official receiver PART IV OFFICIAL RECEIVER AND STAFF
Part
PART IV
- 74 Verify source ↗
Appointment of official receiver and deputy official receivers
AI-assisted research summary: The section establishes an official receiver and any needed deputy official receivers, gives the Minister responsible for Legal Affairs authority over deputy appointments and removal, and gives deputy official receivers the same powers, rights, and duties as an official receiver within their appointed area.
74.–(1) There shall be an official receiver of debtors’ estates for the United Republic and as many deputy official receivers as may be required who shall have jurisdiction in the areas as may be specified. (2) The deputy official receivers shall be appointed, removable by and under the general authority and directions of the Minister responsible for Legal Affairs and they shall also be officers of the court. (3) A deputy official receiver shall have the same powers, rights and duties within the area for which he is appointed as an official receiver under this Act. - 75 Verify source ↗
Status of official receiver
AI-assisted research summary: The official receiver’s duties relate to the debtor’s conduct and estate administration, and the official receiver may administer oaths for certain proceedings. The trustee must give the official receiver information, access, facilities, and other aid needed to perform those duties.
75.–(1) The duties of the official receiver shall have relation to the conduct of the debtor and to the administration of his estate. (2) The official receiver may, for the purposes of affidavits verifying proofs, petitions, or other proceedings under this Act, administer oaths. (3) The provisions in this or any other Act, referring to the trustee in a bankruptcy shall, unless the context requires otherwise, or the Act provides otherwise, include the official receiver when acting as trustee. (4) The trustee shall supply the official receiver with the information, and give him access to and facilities for inspecting the bankrupt’s books and documents, and generally shall give him aid, as may be requisite for enabling the official receiver to perform his duties under this Act. Duties of official receiver as regards debtor’s conduct - 76 Verify source ↗
Duties of official receiver as regards debtor’s conduct
AI-assisted research summary: The official receiver must investigate the debtor’s conduct and report to the court, and may also take part in the debtor’s public examination and help with prosecution if directed.
76. As regards the debtor, it shall be the duty of the official receiver to- (a) investigate the conduct of the debtor and to report the court, stating whether there is reason to believe that, the debtor has committed any act which constitutes an offence under this Act, or any enactment repealed by 457 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Duties of official receiver as to debtor’s estate this Act, or which would justify the court in refusing, suspending or qualifying an order for his discharge; (b) make other reports concerning the conduct of the debtor as the court may direct; (c) take part as he may deem fit in the public examination of the debtor; and (d) take part and give assistance in relation to the prosecution of any fraudulent debtor as the Attorney General may direct. - 77 Verify source ↗
Duties of official receiver as to debtor’s estate
AI-assisted research summary: The official receiver must manage the debtor’s estate, call and chair the first creditors’ meeting, report to creditors, advertise key bankruptcy events, and act as trustee when the trustee office is vacant.
77.–(1) As regards the estate of a debtor, it shall be the duty of the official receiver- (a) pending the appointment of a trustee, to act as interim receiver of the debtor’s estate, and, where a special manager is not appointed, as manager thereof; (b) to authorise the special manager to raise money or make advances for the purposes of the estate in any case where, in the interests of the creditors it appears necessary so to do; (c) to summon and preside at the first meeting of creditors; (d) to issue forms of proxy for use at the meetings of creditors; (e) report to the creditors as to any proposal which the debtor may have made with respect to the mode of liquidating his affairs; (f) to advertise the receiving order, the date of the creditors’ first meeting, and of the debtor’s public examination, and other matters as it may be necessary to advertise; and (g) to act as trustee during any vacancy in the office of trustee. (2) For the purpose of his duties as interim receiver or manager, the official receiver shall have the same powers as if he were a receiver and manager appointed by the court, but shall, as far as practicable, consult the wishes of the creditors with respect to the management of the debtor’s property, and may for that purpose, where he thinks it advisable, summon meetings of the persons claiming to the creditors, and shall not, 458 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] unless the court otherwise orders, incur any expense beyond as is requisite for the protection of the debtor’s property or the disposing of perishable goods: Provided that, when the debtor cannot himself prepare a proper statement of affairs, the official receiver may, subject to any prescribed conditions, and at the expense of the estate, employ some person or persons to assist in the preparation of the statement of affairs. PART V TRUSTEES IN BANKRUPTCY (a) Official Name Official name of trustee Power to appoint joint or successive trustees
Part
PART V
- 78 Verify source ↗
Official name of trustee
AI-assisted research summary: A trustee in bankruptcy uses the official name “the trustee of the property of a bankrupt” (with the bankrupt’s name inserted) and may hold property, make contracts, sue and be sued, and do other acts needed for the office.
78. The official name of a trustee in bankruptcy shall be “the trustee of the property of a bankrupt” (insert the name of the bankrupt), and by that name the trustee may, in any part of United Republic or elsewhere, hold property of every description, make contracts, sue and be sued, enter into any engagements binding on himself, and his successors in office and do other acts necessary or expedient to be done in the execution of his office. (b) Appointment
Part
part of United Republic or elsewhere, hold property of every
- 79 Verify source ↗
Power to appoint joint or successive trustees
AI-assisted research summary: Creditors may appoint more than one trustee and may appoint successor trustees.
79.–(1) The creditors may, where they think fit, appoint more persons than one to the office of trustee, and when more persons than one are appointed, they shall declare whether any act required or authorised to be done by the trustee is to be done by all or any one or more of the persons, but the persons are in this Act included under the term “trustee”, and shall be joint tenants of the property of the bankrupt. (2) The creditors may also appoint persons to act as trustees in succession in the event of one or more of the persons first named declining to accept the office of trustee, or failing to give security, or the appointment of any person not being certified by the court. 459 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Proceedings in case of vacancy in office of trustee Discretionary powers of trustee and control thereof - 80 Verify source ↗
Proceedings in case of vacancy in office of trustee
AI-assisted research summary: If a trustee’s office becomes vacant, creditors can appoint a replacement, and the official receiver must step in if needed.
80.–(1) Where a vacancy occurs in the office of a trustee, the creditors in general meeting may appoint a person to fill the vacancy, and thereupon the same proceedings shall be taken as in the case of a first appointment. (2) The official receiver shall, on the requisition of any creditor, summon a meeting for the purpose of filling any vacancy. (3) Where the creditors do not, within three weeks after the occurrence of a vacancy, appoint a person to fill the vacancy, the official receiver shall report the matter to the court, and the court may appoint a trustee; but in the case the creditors or committee of inspection shall have the same power of appointing a trustee in the place of the person appointed by the court as in the case of a first appointment. (4) During any vacancy in the office of trustee, the official receiver shall act as trustee. (c) Control Over Trustee - 81 Verify source ↗
Discretionary powers of trustee and control thereof
AI-assisted research summary: The trustee must follow creditor directions when administering and distributing the bankrupt’s property, can call creditor meetings, and must call one within 14 days when properly requested.
81.–(1) Subject to the provisions of this Act, the trustee shall, in the administration of the property of the bankrupt and in the distribution thereof amongst his creditors, have regard to any directions that may be given by resolution of the creditors at any general meeting or by the committee of inspection, and any directions given by the creditors at any general meeting shall, in case of conflict, be deemed to override any directions given by the committee of inspection. (2) The trustee may summon general meetings of the creditors for the purpose of ascertaining their wishes, and be his duty to summon meetings at the times as the creditors, by resolution either at the meeting appointing the trustee or otherwise may direct, and be lawful for any creditor, with the concurrence of one- sixth in value of the creditors (including himself), at any time to request the trustee or official receiver to call a meeting of the creditors, and the trustee or official receiver shall call the meeting accordingly within fourteen days: Provided that, the person at whose instance the meeting is summoned shall deposit with the trustee or the official 460 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] receiver, as the case may be, a sum sufficient to pay the costs of summoning the meeting, the sum to be repaid to him out of the estate if the creditors or the court direct. (3) The trustee may apply to the court in the manner prescribed for directions in relation to any particular matter arising under the bankruptcy. (4) Subject to the provisions of this Act, the trustee shall use his own discretion in the management of the estate and its distribution among the creditors. Appeal to court against trustee - 82 Verify source ↗
Appeal to court against trustee
AI-assisted research summary: An aggrieved bankrupt, creditor, or other person may apply to court about a trustee’s act or decision, and the court may confirm, reverse, or modify it.
82. Where the bankrupt or any of the creditors, or any other person, is aggrieved by any act or decision of the trustee, he may apply to the court, and the court may confirm, reverse, or modify the act or decision complained of, and make orders in the premises as it thinks just. Control of official receiver over trustees - 83 Verify source ↗
Control of official receiver over trustees
AI-assisted research summary: The official receiver oversees trustees and may investigate, require answers, and seek court examination when needed.
83.–(1) The official receiver shall take cognizance of the conduct of trustees, and, in the event of any trustee not faithfully performing his duties, and duly observing the requirements imposed on him by any Act, rules, or otherwise, with respect to the performance of his duties, or in the event of any complaint being made to the official receiver by any creditor in regard thereto, the official receiver shall inquire into the matter and take action thereon as may be deemed expedient. (2) The official receiver may at any time require any trustee to answer any inquiry made by him in relation to any bankruptcy in which the trustee is engaged, and, where the official receiver thinks fit, he may apply to the court to examine on oath, the trustee or any other person concerning the bankruptcy. (3) The official receiver may also direct a local investigation to be made of the books and vouchers of the trustee. (d) Remuneration and Costs Remuneration of trustee - 84 Verify source ↗
Remuneration of trustee
AI-assisted research summary: Trustee remuneration is set by the creditors, or in some cases by the committee of inspection or the court, and the trustee cannot take extra benefits or give up part of the remuneration.
84.–(1) Where the creditors appoint any person to be trustee of a debtor’s estate, his remuneration (if any) shall be fixed by an ordinary resolution of the creditors, or, where the creditors 461 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] resolve, by the committee of inspection, and in the nature of a commission or percentage, of which one part shall be payable on the amount realised by the trustee, after deducting any sums paid to secured creditors out of the proceeds of their securities, and the other part on the amount distributed in dividend. (2) Where one- fourth in number or value of the creditors dissent from the resolution, or the bankrupt satisfies the court that, the remuneration is unnecessarily large, the court shall fix the amount of the remuneration. (3) The resolution shall express what expenses the remuneration is to cover, and a liability shall not attach to the bankrupt’s estate, or to the creditors, in respect of any expenses which the remuneration is expressed to cover. (4) Where a trustee acts without remuneration, he shall be allowed out of the bankrupt’s estate the proper expenses incurred by him in or about the proceedings of the bankruptcy as the creditors may, with the sanction of the court, approve. (5) A trustee shall not, under any circumstances whatever, make any arrangements for or accept from the bankrupt, or any advocate, auctioneer, or any other person that may be employed about a bankruptcy, any gift, remuneration, or pecuniary or other consideration or benefit whatever beyond the remuneration fixed by the creditors and payable out of the estate, nor shall he make any arrangement for giving up, or give up, any part of his remuneration, either as receiver, manager, or trustee, to the bankrupt or any advocate, or other person that may be employed about the bankruptcy. - 85 Verify source ↗
Allowance and taxation of costs
AI-assisted research summary: This section controls when trustee and manager-related costs can be allowed in accounts, requires taxation of certain bills by the prescribed officer, and sets deadlines and consequences for delivering bills of costs.
85.–(1) Where a trustee or manager receives remuneration for his services, a payment shall not be allowed in his accounts in respect of the performance by any other person of the ordinary duties which are required by this Act or rules thereunder to be performed by himself. (2) Where the trustee is an advocate, he may contract that, the remuneration for his services as trustee shall include professional services. 462 Allowance and taxation of costs ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (3) All bills and charges of advocates, managers, accountants, auctioneers, brokers, and other persons, not being trustees shall be taxed by the prescribed officer, and a payments in respect thereof shall not be allowed in the trustee’s accounts without proof of taxation having been made, and the taxing officer shall satisfy himself before passing the bills and charges that, the employment of the advocates and other persons, in respect of the particular matters out of which the charges arise, has been duly sanctioned, and the sanction shall be obtained before the employment, except in case of urgency, and in other cases it must be shown that no undue delay took place in obtaining the sanction. (4) A person shall, on request by the trustee (which request the trustee shall make a sufficient time before declaring a dividend), deliver his bill of costs or charges to the proper officer for taxation, and, where he fails to do so within seven days after the receipt of the request, or further time as the court, on application may grant, the trustee shall declare and distribute the dividend without regard to any claim by him and thereupon any claim shall be forfeited as well against the trustee personally as against the estate. (e) Receipts, Payments, Accounts and Audit - 86 Verify source ↗
Trustee to furnish list of creditors
AI-assisted research summary: If a creditor asks, the trustee or official receiver must send that creditor a list of creditors showing the amount owed to each one, and may charge a fee for the list plus postage.
86. The trustee or official receiver shall, whenever required by any creditor so to do, furnish and transmit to him by post, a list of the creditors showing the amount of the debt due to each creditor, and be entitled to charge for the list, the sum of fifty cents per folio of one hundred words, together with the cost of the postage thereof. Trustee to furnish list of creditors Trustee to furnish statement of accounts - 87 Verify source ↗
Trustee to furnish statement of accounts
AI-assisted research summary: A creditor may ask the trustee or official receiver for a statement of accounts if one-sixth of the creditors agree, and the trustee must provide it after notice.
87. It shall be lawful for any creditor, with the concurrence of one- sixth of the creditors (including himself), at any time to call upon the trustee or official receiver to furnish and transmit to the creditors, a statement of the accounts up to the date of the notice, and the trustee upon the receipt of the notice shall furnish and transmit statement of the accounts: 463 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Provided that, the person at whose instance the accounts are furnished shall deposit with the trustee or official receiver, as the case may be, a sum sufficient to pay the costs of furnishing and transmitting the accounts, which sum shall be repaid to him out of the estate where the creditors or the court so direct. Books to be kept by trustee - 88 Verify source ↗
Books to be kept by trustee
AI-assisted research summary: The trustee must keep proper books in the prescribed manner, including entries or minutes of meetings and other prescribed matters. A creditor of the bankrupt may inspect the books, subject to the court’s control.
88. The trustee shall keep, in a manner prescribed, proper books in which he shall cause to be made entries or minutes of proceedings at meetings, and other matters as may be prescribed, and any creditor of the bankrupt may, subject to the control of court, personally or by his agent, inspect any books. Annual statement of proceedings - 89 Verify source ↗
Annual statement of proceedings
AI-assisted research summary: A bankruptcy trustee must send the official receiver a yearly statement of the bankruptcy proceedings in the prescribed form and with the prescribed particulars.
89.–(1) A trustee in a bankruptcy shall as may be prescribed, and not less than once in every year during the continuance of the bankruptcy, transmit to the official receiver a statement showing the proceedings in the bankruptcy up to the date of the statement containing the prescribed particulars and made out in the prescribed form. (2) The official receiver shall cause the statements transmitted to be examined, and call the trustee to account for any misfeasance, neglect, or omission, which may appear on the said statements or in his accounts or otherwise, and may require the trustee to make good any loss which the estate of the bankrupt may have sustained by the misfeasance, neglect, or omission. Trustee not to pay into private account - 90 Verify source ↗
Trustee not to pay into private account
AI-assisted research summary: A bankruptcy trustee must not pay trust money into a private banking account.
90. A trustee in a bankruptcy or under any composition or scheme of arrangement shall not pay any sums received by him as trustee into his private banking account. Payment of money into prescribed bank - 91 Verify source ↗
Payment of money into prescribed bank
AI-assisted research summary: The official receiver and trustee must pay bankruptcy money into the required account, and the court can allow local bank arrangements in limited cases.
91.–(1) A Bankruptcy Estates Account shall be kept by the official receiver with the prescribed bank, and the moneys received by him in respect of proceedings under this Act shall be paid to that account. (2) A trustee in bankruptcy shall, in a manner and at the time as the official receiver shall direct, pay the money received by him to the Bankruptcy Estates Account at the prescribed bank, 464 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] and the official receiver shall furnish him with a certificate of receipt of the money paid: Provided that- (a) where it appears to the committee of inspection that, for the purpose of carrying on the debtor’s business or of obtaining advances, or because of the probable amount of the cash balance, or where the committee shall satisfy the court that, for any other reason it is for the advantage of the creditors that, the trustee should have an account with the local bank, the court shall, on the application of the committee of inspection, authorise the trustee to make his payments into and out of local bank as the committee may select; and (b) in any bankruptcy composition or scheme or arrangement in which the official receiver is acting as trustee, or in which a trustee is acting without a committee of inspection, the court may, where for special reasons it thinks fit to do so, upon the application of the official receiver or other trustee, authorise the trustee to make his payments into and out of local bank as the court may direct. (3) Where the trustee opens an account in a local bank, he shall open and keep it in the name of the debtor’s estate, and any interest receivable in respect of the account shall be part of the assets of the estate, and the trustee shall make his payments into and out of the local bank in the prescribed manner. (4) Subject to any general rules relating to small bankruptcies referred to in section 119, where the debtor at the date of the receiving an order has an account at a bank, the accounts shall not be withdrawn until the expiration of seven days from the day appointed for the first meeting of creditors, unless the court, for the safety of the account, or other sufficient cause, orders the withdrawal of the account. (5) Where a trustee at any time retains for more than ten days, a sum exceeding one thousand shillings, or other amount as the court in any particular case authorises him to retain, then, unless he explains the retention to the satisfaction of the 465 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Investment of surplus funds court, he shall pay interest on the amount retained in excess at the rate of twenty per centum per annum, and shall not have claim to remuneration, and may be removed from his office by the court, and shall be liable to pay any expenses occasioned by reason of his default. - 92 Verify source ↗
93. Audit of trustee’s accounts
AI-assisted research summary: The official receiver may place excess bankruptcy estate cash on fixed deposit, must move it back when needed, and must credit the interest to the Bankruptcy Contingency Fund. The court can authorize use of that fund for specified bankruptcy-related costs and may order reimbursement if money is later recovered.
92.–(1) Whenever the cash balance standing to the credit of the Bankruptcy Estates Account is in excess of the amount which in the opinion of the official receiver is required for the time being to answer demands in respect of bankrupts’ estates, the official receiver may place the same or any part thereof on fixed deposit with the prescribed bank. (2) Whenever any money placed on deposit is, in the opinion of the official receiver, required to answer any demands in respect of bankrupts’ estates, the official receiver shall thereupon withdraw the money from fixed deposit and repay the same to the credit of the cash balance of the Bankruptcy Estates Account. (3) The interest accruing from any money placed on deposit shall be paid by the official receiver to the credit of a separate account entitled the Bankruptcy Contingency Fund at the prescribed bank. (4) Where it appears that, it is in the public interest to do so and other funds are not available or properly chargeable, the court may, on the application of the official receiver, authorise him to employ money in the Bankruptcy Contingency Fund to defray the cost in whole or in part of any of the following: (a) the prosecution of any debtor for any bankruptcy offences alleged to have been committed by him; (b) the institution of proceedings and the payment of expenses of witnesses (if any) for the discovery or recovery of property belonging to any debtor; (c) the institution of proceedings to set aside an alleged fraudulent preference; (d) the employment of counsel in matters connected with an estate which by reason of their difficulty or other good cause cannot be dealt with by the official receiver himself; 466 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Audit of trustee’s accounts Release of trustee (e) the employment of interpreters in cases where the court is unable to provide an interpreter; (f) the payment of expenses involved in arresting a debtor and bringing him before the court; or (g) any other expenditure which the court may deem fit. (5) The court may, in its discretion, order that the fund be reimbursed in whole or in part in the event of any money being recovered as a result of the expenditure authorised. - 93 Verify source ↗
Audit of trustee’s accounts
AI-assisted research summary: A trustee must send account statements to the official receiver at least twice a year, in the prescribed form, and help with the audit.
93.–(1) A trustee shall, at the time as may be prescribed, but not less than twice in each year during his tenure of office, send to the official receiver an account of his receipts and payments as trustee. (2) The account shall be in a prescribed form, made in duplicate, and verified by a statutory declaration in the prescribed form. (3) The official receiver shall cause the accounts sent to be audited, and, for the purposes of the audit, the trustee shall furnish the auditor with vouchers and information as the auditor may require, and the auditor may at any time require the production of and inspect any books or accounts kept by the trustee. (4) When any account has been audited, one copy thereof shall be filed and kept by the official receiver, and the other copy filed with the court, and each copy shall be open to the inspection of any creditor, or of the bankrupt, or of any person interested. (f) Vacation of Office by Trustee - 94 Verify source ↗
Release of trustee
AI-assisted research summary: A trustee may apply to the court for release after the estate is realised or the trustee has otherwise stopped acting, and the court may grant or refuse that release.
94.–(1) When the trustee has realised the property of the bankrupt, or so much thereof as can, in his opinion, be realised without needlessly protracting the trusteeship, and distributed a final dividend, if any, or has ceased to act by reason of a composition having been approved, or has resigned, or has been removed from his office, the court shall, on his application, cause a report on his accounts to be prepared, and, on his complying with the requirements of the court, take into 467 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] consideration the report, and any objection which may be urged by any creditor or person interested against the release of the trustee, and either grant or withhold the release accordingly. (2) Where the release of a trustee is withheld, the court may, on the application of any creditor or person interested, make order as it thinks just, charging the trustee with the consequences of any act or default he may have done or made contrary to his duty. (3) An order of the court releasing the trustee shall discharge him from liability in respect of any act done or default made by him in the administration of the affairs of the bankrupt, or otherwise in relation to his conduct as trustee, but any order may be revoked on proof that, it was obtained by fraud, suppression or concealment of any material fact. (4) The foregoing provisions of this section shall apply to the official receiver when he is, or is acting as trustee, and when the official receiver has been released under this section, he shall continue to act as trustee for any subsequent purposes of the administration of the debtor’s estate, but liability shall not attach to him personally by reason of his continuing in respect of any act done, default made, or liability incurred before his release. (5) Where the trustee has not previously resigned or been removed, his release shall operate as a removal of him from his office and thereupon the official receiver shall be the trustee. (6) Where, on the release of a trustee, the official receiver is, or is acting as trustee, liability shall not attach to him personally in respect of any act done or default made, or liability incurred by any prior trustee. Office of trustee vacated by insolvency Removal of trustee - 95 Verify source ↗
Office of trustee vacated by insolvency
AI-assisted research summary: If a receiving order is made against a trustee, the trustee vacates the office of trustee.
95. Where a receiving order is made against a trustee, he shall thereby vacate his office of trustee. - 96 Verify source ↗
Removal of trustee
AI-assisted research summary: Creditors may remove a trustee at a specially called meeting with seven days’ notice, and the court may remove a trustee for misconduct or other listed inability or conflict reasons.
96.–(1) The creditors may, by ordinary resolution, at a meeting specially called for that purpose of which seven days’ notice has been given, remove a trustee appointed by them, and may, at the same or any subsequent meeting, appoint another person 468 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] to fill the vacancy as hereinafter provided in case of a vacancy in the office of trustee. (2) Where the court is of opinion that- (a) a trustee appointed by the creditors is guilty of misconduct or fails to perform his duties under this Act; (b) his trusteeship is being needlessly protracted without any probable advantage to the creditors; (c) he is by reason of lunacy, or continued sickness or absence, incapable of performing his duties; or (d) his connection with or relation to the bankrupt or his estate, or any particular creditor, might make it difficult for him to act with impartiality in the interest of the creditors generally, or where, in any other matter he has been removed from office on the ground of misconduct, the court may remove him from his office. PART VI CONSTITUTION, PROCEDURE AND POWERS OF COURT (a) Jurisdiction Jurisdiction in bankruptcy
Part
PART VI
- 97
AI-assisted research summary: The High Court is the bankruptcy court, and the Chief Justice may delegate that jurisdiction to a subordinate court by order.
97. The court having jurisdiction in bankruptcy shall be the High Court and the Chief Justice may by order delegate all or any part of the jurisdiction of the High Court in bankruptcy to any subordinate court, either generally or for the purpose of any particular case or class of cases. Judge may exercise his powers in chambers - 98 Verify source ↗
99. Official receiver to make payments in accordance with directions of court
AI-assisted research summary: A judge of the court may exercise any or all of their powers in chambers, subject to the Act and general rules.
98. Subject to the provisions of this Act, and general rules, a judge of the court may exercise in chambers the whole or any part of his powers. Official receiver to make payments in accordance with directions of court
Part
part of his powers.
- 99 Verify source ↗
Official receiver to make payments in accordance with directions of court
AI-assisted research summary: If the court orders that someone is entitled to money or funds held by the official receiver, the official receiver must pay that person.
99. Where any moneys or funds have been received by the official receiver under this Act and the court makes an order declaring that any person is entitled to the moneys or funds, the official receiver shall make payment accordingly to that person. 469 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] General powers of court - 100 Verify source ↗
General powers of court
AI-assisted research summary: The court has broad power in bankruptcy cases to decide questions of law or fact, and it may order a defaulting trustee, debtor, or other person to comply with an official receiver’s order or direction.
100.–(1) Subject to the provisions of this Act, the court shall have full power to decide questions of priorities, and other questions whatsoever, whether of law or fact, which may arise in any case of bankruptcy coming within its cognisance, or which the court may deem it expedient or unnecessary to decide for the purpose of doing complete justice or making a complete distribution of property in any case. (2) Where default is made by a trustee, debtor, or other person, in obeying any order or direction given by the official receiver, the court may on the application of the official receiver order defaulting trustee, debtor, or person to comply with the order or directions given; and the court may also, if it thinks fit upon any application, make an immediate order for the committal of defaulting trustee, debtor or person: Provided that, the power given by this subsection shall be deemed to be in addition to and not in substitution for any other right or remedy in respect of the default. Disqualification of bankrupt - 101 Verify source ↗
Disqualification of bankrupt
AI-assisted research summary: A bankrupt person is disqualified from holding certain public offices, and any such office held at the time of bankruptcy becomes vacant.
101.–(1) Where a debtor is adjudged bankrupt, he shall be disqualified for being- (a) appointed or acting as a justice of the peace; or (b) elected to, or holding or exercising the office of mayor or member of a local government authority, school committee or road board. (2) Where a person is adjudged bankrupt whilst holding the office of justice of the peace, mayor, or member of a local government authority, school committee or road board his office shall thereupon become vacant. (3) The disqualifications to which a bankrupt is subject under this section shall be removed and cease where- (a) the adjudication of bankruptcy against him is annulled; (b) a period of five years has elapsed from the date of his discharge; or (c) he obtains from the court his discharge with a certificate to the effect that, his bankruptcy was caused by misfortune without any misconduct on his part. 470 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Power to make receiving order in lieu of committal order Ord. No. 45 of 1947 s. 18 Appeals in bankruptcy Ord. No. 20 of 1958 s. 17 (4) The court may grant or withhold the certificate referred to subsection (3)(c) as it thinks fit, but any refusal of the certificate shall be subject to appeal. (b) Judgment Debtors - 102 Verify source ↗
Power to make receiving order in lieu of committal order
AI-assisted research summary: If a judgment creditor asks the court to commit a judgment debtor, the court may instead make a receiving order if it thinks fit, the creditor consents, and the prescribed fee is paid.
102. Where application is made by a judgment creditor to the court for the committal of a judgment debtor, the court may, where it thinks fit, decline to commit, and in lieu thereof, with the consent of the judgment creditor and on payment by him of the prescribed fee, make a receiving order against the debtor, and in that case the judgment debtor shall be deemed to have committed an act of bankruptcy at the time the order is made, and the provisions of this Act shall apply as if for references to the presentation of a petition by or against a person, there were substituted references to the making of the a receiving order. (c) Appeals - 103 Verify source ↗
Appeals in bankruptcy
AI-assisted research summary: The court may review, rescind, or vary its own orders at any time, and bankruptcy orders may be appealed by an aggrieved person if the appeal follows the applicable general rules. Appeals against decisions of the official receiver must be brought within 21 days.
103.–(1) The court may at any time review, rescind or vary any order made by it. (2) Orders of the court in bankruptcy matters shall, at the instance of the person aggrieved, be subject to appeal but an appeal shall not be entertained except in conformity with general rules as may for the time being be in force in relation to the appeal. (3) Where, by this Act, an appeal to the court is given against any decision of the official receiver, the appeal shall be brought within twenty- one days from the time when the decision appealed against is pronounced or made. (d) Procedure Discretionary power of court - 104 Verify source ↗
Discretionary power of court
AI-assisted research summary: The court may control costs, adjourn or amend proceedings, extend time limits, and decide how evidence is taken, subject to this Act and general rules.
104.–(1) Subject to the provisions of this Act and to general rules, the costs of and incidental to any proceeding in court under this Act shall be in the discretion of the court. (2) The court may at any time adjourn any proceedings before it upon the terms, if any, as it may think fit to impose. 471 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (3) The court may at any time amend any written process or proceeding under this Act, upon the terms, if any, as it may think fit to impose. (4) Where by this Act, or by general rules, the time for doing any act is limited, the court may extend the time either before or after the expiration thereof upon the terms, if any, as it may think fit to impose. (5) Subject to general rules, the court may in any matter, take the whole or any part of the evidence either viva voce, or by interrogatories; or upon affidavit, or, outside Tanzania, by commission. Consolidation of petitions - 105 Verify source ↗
Consolidation of petitions
AI-assisted research summary: If multiple bankruptcy petitions are filed against the same debtor or joint debtors, the court may consolidate the proceedings.
105. Where two or more bankruptcy petitions are presented against the same debtor or against joint debtors, the court may consolidate the proceedings, or any of them, on the terms as the court thinks fit. Power to change carriage of proceedings - 106 Verify source ↗
Power to change carriage of proceedings
AI-assisted research summary: If a petitioner does not pursue a petition diligently, the court may replace the petitioner with another creditor who meets the Act’s amount requirements.
106. Where the petitioner does not proceed with due diligence on his petition, the court may substitute as petitioner any other creditor to whom the debtor may be indebted in the amounts required by this Act in the case of the petitioning creditor. Continuance of proceedings on death of debtor Power to stay proceedings - 107 Verify source ↗
Continuance of proceedings on death of debtor
AI-assisted research summary: If a debtor dies after a bankruptcy petition has been presented, the proceedings continue as if the debtor were still alive, unless the court orders otherwise.
107. Where a debtor by or against whom a bankruptcy petition has been presented dies, the proceedings in the matter shall, unless the court orders otherwise, be continued as if he were alive. - 108 Verify source ↗
Power to stay proceedings
AI-assisted research summary: The court may, for sufficient reason, stay proceedings under a bankruptcy petition, either completely or for a limited time, on terms and conditions it considers just.
108. The court may at any time, for sufficient reason make an order staying the proceedings under a bankruptcy petition, either altogether or for a limited time, on the terms and subject to the conditions as the court may think just. Power to present petition against one partner - 109 Verify source ↗
Power to present petition against one partner
AI-assisted research summary: A creditor with sufficient debt may present a bankruptcy petition against one or more partners of a firm without joining the others.
109. A creditor whose debt is sufficient to entitle him to present a bankruptcy petition against the partners of a firm may present a petition against anyone or more partners of the firm without including the others. 472 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Power to dismiss petition against some respondents only - 110 Verify source ↗
Power to dismiss petition against some respondents only
AI-assisted research summary: If a petition has more than one respondent, the court may dismiss it against one or more respondents while leaving it effective against the others.
110. Where there are more respondents than one to a petition, the court may dismiss the petition as to one or more of them, without prejudice to the effect of the petition as against the other or others of them. Property of partners to be vested in same trustee Actions by trustee and bankrupt’s partners - 111 Verify source ↗
Property of partners to be vested in same trustee
AI-assisted research summary: If a bankruptcy receiving order has already been made for one partner, later bankruptcy petitions involving another partner in the same partnership must be filed together, the same trustee or receiver should usually be appointed, and the court may order the proceedings to be consolidated.
111. Where a receiving order has been made on a bankruptcy petition by or against one member of a partnership, any other bankruptcy petition by or against a member of the same partnership shall be filed with the first mentioned petition, and, unless the court directs otherwise, the same trustee or receiver shall be appointed as may have been appointed in respect of the property of the first mentioned member of the partnership, and the court may give directions for consolidating the proceedings as it thinks just. - 112 Verify source ↗
Actions by trustee and bankrupt’s partners
AI-assisted research summary: If a partnership member is bankrupt, the court may let the trustee sue in the names of the trustee and the bankrupt’s partner; the partner can object, and any release by the partner of the related debt is void.
112. Where a member of a partnership is adjudged bankrupt, the court may authorise the trustee to commence and prosecute any action in the names of the trustee and of the bankrupt’s partner; and any release by partner of the debt or demand to which the action relates shall be void; but notice of the application for authority to commence the action shall be given to him, and he may show cause against it, and on his application the court may, if it thinks fit, direct that, he shall receive his proper share of the proceeds of the action, and where he does not claim any benefit therefrom, he shall be indemnified against costs in respect thereof as the court directs. Actions on joint contracts - 113 Verify source ↗
Actions on joint contracts
AI-assisted research summary: If a bankrupt is jointly involved in a contract, the other person or persons may sue or be sued on the contract without joining the bankrupt.
113. Where a bankrupt is a contractor in respect of any contract jointly with any person or persons, the person or persons may sue or be sued in respect of the contract without the joinder of the bankrupt. Proceedings in partnership name - 114 Verify source ↗
Proceedings in partnership name
AI-assisted research summary: Partners, or anyone doing business under a partnership name, may sue or be sued in the firm name. The court may require the partners’ names, or the person’s name, to be disclosed on application by an interested person.
114. Two or more persons, being partners, or any person carrying on business under a partnership name, may take proceedings or be proceeded against under this Act in the name of the firm, but in the case the court may, on application by any person interested, order the names of the persons 473 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Court to be auxiliary to other reciprocating courts Commitment to prison who are partners in the firm or the name of the person to be disclosed in a manner, and verified on oath or otherwise, as the court may direct. - 115 Verify source ↗
Court to be auxiliary to other reciprocating courts
AI-assisted research summary: The Tanzania court and its officers must assist reciprocating bankruptcy or insolvency courts elsewhere.
115. The court of Tanzania and the officers thereof shall in matters of bankruptcy, act in aid of every reciprocating court elsewhere having jurisdiction in bankruptcy or insolvency, and an order of the court seeking aid, with a request to this court shall be deemed sufficient to enable this court to exercise, in regard to the matters directed by the order, jurisdiction as either the court which made the request, or this court could exercise in regard to similar matters within their respective jurisdiction, save that to enable the official receiver of the United Republic to act as the agent of an officer of a reciprocating court or to enable an officer of this court to seek the aid of an official receiver of a reciprocating court in the manner provided in Part IX of this Act, it shall not be necessary for this court or any reciprocating court to make any order or send any request under this section. - 116 Verify source ↗
Commitment to prison
AI-assisted research summary: If a court commits a person to prison, it may send them to a convenient prison. A gaoler who refuses to receive a committed prisoner can be fined up to two thousand shillings for each refusal.
116. Where the court commits any person to prison, the commitment may be to convenient prison as the court thinks expedient, and, where the gaoler of any prison refuses to receive any prisoner committed, on conviction shall be liable for every refusal to a fine not exceeding two thousand shillings. PART VII SUPPLEMENTARY PROVISIONS (a) Application of the Act Married women Ord. No. 45 of 1947 s. 19
Part
PART VII
- 117 Verify source ↗
Married women
AI-assisted research summary: A married woman is subject to the bankruptcy laws as if she were unmarried.
117.–(1) A married woman shall be subject to the bankruptcy laws as if she were femme sole. (2) Where a final judgment or order for any amount has been obtained against a married woman, whether or not expressed to be payable out of her separate property, that judgment or order shall be available for bankruptcy proceedings against her by a bankruptcy notice as though she were personally bound to pay the judgment debt or sum ordered to be paid. 474 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Exclusion of companies Cap. 212 - 118 Verify source ↗
Exclusion of companies
AI-assisted research summary: A receiving order cannot be made against a corporation or against an association or company registered under the Companies Act.
118. A receiving order shall not be made against any corporation or against any association or company registered under the Companies Act. Application of Act in case of small estates Ords. Nos. 45 of 1947 s. 20 20 of 1958 s. 18 - 119 Verify source ↗
Application of Act in case of small estates
AI-assisted research summary: If a debtor’s estate is likely to be worth no more than 12,000 shillings, the court may order summary administration and apply the listed modifications.
119. Where a petition is presented by or against a debtor, and the court is satisfied by affidavit or otherwise, or the official receiver reports to the court that, the property of the debtor is not likely to exceed in value twelve thousand shillings, the court may make an order that, the debtor’s estate be administered in a summary of manner, and thereupon the provisions of this Act shall be subject to the following modifications- (a) where the debtor is adjudged bankrupt the official receiver shall be the trustee in the bankruptcy; (b) there shall be no committee of inspection, but the official receiver may do things which may be done by the trustee with the permission of the committee of inspection; and (c) other modifications may be made in the provisions of this Act as may be prescribed by general rules with the view of saving expense and simplifying procedure, but this section shall not permit the modification of the provisions of this Act relating to the examination or discharge of the debtor: Provided that, the creditors may at any time, by special resolution, resolve that, some person other than the official receiver be appointed trustee in the bankruptcy, and thereupon the bankruptcy shall proceed as if an order for summary administration had not been made. Administration in bankruptcy of estate of person dying insolvent Ords. Nos. 45 of 1947 s. 21 20 of 1958 ss. 10 and 19 - 120 Verify source ↗
Administration in bankruptcy of estate of person dying insolvent
AI-assisted research summary: A creditor may ask the court to administer a deceased debtor’s estate in bankruptcy, and the court may make or dismiss the order. After an administration order, the official receiver must realise and distribute the property, while the legal personal representative is restricted from payments or transfers after notice.
120.–(1) A creditor of a deceased debtor whose debt would have been sufficient to support a bankruptcy petition against the debtor, had he been alive, may present to the court a petition in the prescribed form praying for an order for the administration of the estate of the deceased debtor, according to the law of bankruptcy. 475 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (2) Upon the prescribed notice being given to the legal personal representative of the deceased debtor, the court may, in the prescribed manner, upon proof of the petitioner’s debt, unless the court is satisfied that, there is a reasonable probability that the estate will be sufficient for the payment of the debts owing by the deceased, make an order for the administration in bankruptcy of the deceased debtor’s estate, or may, upon cause shown, dismiss the petition with or without costs. (3) Upon an order being made for the administration of a deceased debtor’s estate, the property of the debtor shall vest in the official receiver, as trustee thereof, and he shall forthwith proceed to realise and distribute it in accordance with the provisions of this Act: Provided that, creditors shall have- (a) the same powers as to appointment of trustees and committees of inspection as they have in other cases, where the estate of a debtor is being administered or dealt with in bankruptcy, and the provisions of this Act relating to trustees and committees of inspection shall apply to trustees and committees of inspection appointed under the power conferred; and (b) where a trustee other than the official receiver is appointed and a committee of inspection is not appointed, any act or thing or any direction or permission which might have been done or given by a committee of inspection may be done or given by the court. (4) The provisions of Part III and IX of this Act and of sections 28,85, 94(4) and 119 shall, so far as the same are applicable, apply to the administration under the provisions of this section of the estate of a deceased debtor in like manner as they apply in the case of a bankruptcy and in their application to the administration of the estate of a deceased debtor those provisions shall be read as if- (a) for references to the presentation of the bankruptcy petition, there were substituted references to the presentation of the petition for an order of administration; 476 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (b) for references to the date of the making of the receiving order, there were substituted references to the date of death; (c) for references to becoming bankrupt and to the bankrupt, there were substituted references to dying insolvent and the deceased debtor; (d) for references to a person being adjudged bankrupt and the making of an order of adjudication, there were substituted references to the making of an order of administration; (e) for references to the bankruptcy, there were substituted references to the administration; (f) references to committing an act of bankruptcy included references to dying insolvent; and (g) there were added to the list of debts which under the provisions of section 38 are to be paid in priority to other debts, death- bed charges including fees for medical attendance on the deceased debtor, and charges for the board and lodging of the deceased debtor for one month prior to his death. (5) In the administration of the property of the deceased debtor under an order of administration, the official receiver or trustee shall have regard to any claim by the legal personal representative of the deceased debtor to payment of the proper funeral and testamentary expenses incurred by him in and about the debtor’s estate, and the claims shall be deemed a preferential debt under the order, and notwithstanding anything to the contrary in the provisions of this Act relating to the priority of other debts, shall be payable in full, out of the debtor’s estate, in priority to other debts. (6) Where, on the administration of a deceased debtor’s estate, any surplus remains in the hands of the official receiver or trustee after payment in full of the debts due from the debtor together with the costs of the administration and interest as provided by this Act in case of bankruptcy, the surplus shall be paid over to the legal personal representative of the deceased debtor’s estate, or dealt with in other manner as may be prescribed. 477 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (7) Notice to the legal personal representative of a deceased debtor of the presentation by a creditor of a petition under this section shall, in the event of an order for administration being made thereon, be deemed to be equivalent to notice of an act of bankruptcy, and after that notice, a payment or transfer of property made by the legal personal representative shall not operate as a discharge to him as between himself and the official receiver or trustee; save as aforesaid this section shall not invalidate any payment made or any act or thing done in good faith by the legal personal representative before the date of the order for administration. (8) A petition for the administration of the estate of a deceased debtor under this section may be presented by the legal personal representative of the debtor, and, where a petition is presented by a representative, this section shall apply subject to modifications as may be prescribed by general rules made under subsection (10) of this section. (9) Unless the context requires otherwise, “creditor” means one or more creditors qualified to present a bankruptcy petition as in this Act provided, and of the expressions “property of the deceased debtor” and “estate of the deceased debtor” shall be deemed to include any property which would have been divisible amongst the creditors had a bankruptcy petition been presented against the deceased debtor immediately before his death and the proceedings had been continued as if he were alive. (10) General rules for carrying into effect the provisions of this section may be made in the same manner and to the like effect and extent as in bankruptcy. (b) General Rules Power to make general rules GNs Nos. 478 of 1962 64 of 1966 - 121 Verify source ↗
Power to make general rules
AI-assisted research summary: The Chief Justice may make general rules to carry out the Act’s objects, but only with the Minister responsible for Legal Affairs’ concurrence.
121. The Chief Justice, may with the concurrence of the Minister responsible for Legal Affairs, make general rules for carrying into effect the objects of this Act. 478 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Fees GN. No. 478 of 1962 Salaries and remuneration GN. No. 478 of 1962 Gazette to be evidence Evidence of proceedings at meetings of creditors (c) Fees and Salaries - 122 Verify source ↗
Fees
AI-assisted research summary: The Chief Justice may set a scale of fees and percentages for proceedings under this Act, but only with the Minister responsible for Legal Affairs’ concurrence.
122. The Chief Justice may, with the concurrence of the Minister responsible for Legal Affairs, prescribe a scale of fees and percentages to be charged for in respect of proceedings under this Act. - 123 Verify source ↗
Salaries and remuneration
AI-assisted research summary: The Chief Justice may decide and change the remuneration payable for people doing duties under this Act, with the Minister responsible for Legal Affairs concurring.
123. The Chief Justice shall, with the concurrence of the Minister responsible for Legal Affairs, direct whether any and what remuneration is to be allowed to any person (other than the official receiver or his staff) performing any duties under this Act, and may vary, increase, or diminish remuneration, as he may think fit. (d) Evidence - 124 Verify source ↗
Gazette to be evidence
AI-assisted research summary: A copy of the Gazette with a notice inserted under the Act is evidence of the facts in that notice; for certain bankruptcy-related orders, it is conclusive evidence that the order was made and of its date.
124.–(1) A copy of the Gazette containing any notice inserted therein in pursuance of this Act shall be evidence of the facts stated in the notice. (2) The production of a copy of the Gazette containing any notice of a receiving order, or of an order adjudging a debtor bankrupt shall be conclusive evidence in legal proceedings of the order having been duly made, and of its date. - 125 Verify source ↗
Evidence of proceedings at meetings of creditors
AI-assisted research summary: A signed minute of a creditors’ meeting must be accepted as evidence without further proof.
125.–(1) A minute of proceedings at a meeting of creditors under this Act, signed at the same or the next ensuing meeting, by a person describing himself as, or appearing to be the chairman of the meeting at which the minute is signed shall be received in evidence without further proof. (2) Until the contrary is proved, a meeting of creditors in respect of the proceedings whereof a minute has been signed shall be deemed to have been duly convened and held, and resolutions passed or proceedings had thereat to have been duly passed or had. Evidence of proceedings in bankruptcy - 126 Verify source ↗
Evidence of proceedings in bankruptcy
AI-assisted research summary: Certain bankruptcy documents may be used as evidence in legal proceedings if they are sealed, signed by a judge, or certified as true copies by a registrar.
126. A petition or copy of a petition in bankruptcy, any order or certificate or copy of an order or certificate made by the court, any instrument or copy of an instrument, affidavit or 479 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] document made or used in the course of any bankruptcy proceedings or other proceedings had under this Act, shall where it appears to be sealed with the seal of the court, or purports to be signed by any judge thereof, or is certified as a true copy by any registrar thereof, be receivable in evidence in legal proceedings whatever. - 127 Verify source ↗
Swearing of affidavits
AI-assisted research summary: An affidavit to be used in court may be sworn before certain authorised officers, including a magistrate or justice of the peace, and special provision is made for a person living outside the United Republic.
127. Subject to general rules, any affidavit to be used in the court may be sworn before any person authorised to administer oaths in the court, or before a magistrate or a justice of the peace for the district where it is sworn, or in the case of a person residing outside the United Republic, before any person qualified to administer oaths in the country where he resides. - 128 Verify source ↗
Death of debtor or witness
AI-assisted research summary: A deposition or sealed copy may be admitted as evidence if the debtor, the debtor’s wife, or a witness who already testified dies.
128. In the case of the death of the debtor or his wife, or of a witness whose evidence has been received by the court in any proceeding under this Act, the deposition of the person deceased, purporting to be sealed with the seal of the court, or a copy thereof purporting to be sealed, shall be admitted as evidence of the matters therein deposed to. Swearing of affidavits Death of debtor or witness Certificate of appointment of trustee - 129 Verify source ↗
Certificate of appointment of trustee
AI-assisted research summary: A court certificate confirming that a person has been appointed trustee under this Act is conclusive evidence of that appointment.
129. A certificate of the court that a person has been appointed trustee under this Act shall be conclusive evidence of his appointment. Computation of time (e) Miscellaneous Provisions - 130 Verify source ↗
Computation of time
AI-assisted research summary: This section explains how to count time limits under the Act, excluding the starting day and, in some cases, Sundays, public holidays, and days when court offices are closed.
130.–(1) Where by this Act, any limited time from or after any date or event is appointed or allowed for the doing of any act or the taking of any proceeding, then in the computation of that limited time, the same shall be taken as exclusive of the day of that date or of the happening of that event, and as commencing at the beginning of the next following day; and the act or proceeding shall be done or taken at latest on the last day of that limited time as computed, unless the last day is a Sunday or a public holiday or a day on which the offices of the court are wholly closed, in which case any act or proceeding 480 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] shall be considered as done or taken in due time where it is done or taken on the next day afterwards which is not one of the days specified in this section. (2) Where by this Act, the time limited for doing any act or thing is less than six days, a Sunday, public holiday and any other day on which the offices of the court are wholly closed shall be excluded in computing the time. (3) Where by this Act any act or proceeding is directed to be done or taken on a certain day, then, where that day happens to be one of the days specified in this section, the act or proceeding shall be considered as done or taken in due time where it is done or taken on the next day afterwards which is not one of the days specified in this section. Service of notices - 131 Verify source ↗
Service of notices
AI-assisted research summary: Notices and other documents may be sent by post to the person’s last known address if no special mode of service is directed.
131. The notices and other documents for the service of which a special mode is not directed may be sent by post to the last known address of the person to be served therewith. Formal defect not to invalidate proceedings Exemption of deeds, etc., from stamp duty - 132 Verify source ↗
Formal defect not to invalidate proceedings
AI-assisted research summary: Bankruptcy proceedings are not invalid just because of a formal defect or irregularity, unless the court thinks the defect caused substantial injustice that cannot be fixed by a court order.
132.–(1) A proceeding in bankruptcy shall not be invalidated by any formal defect or by any irregularity, unless the court before which an objection is made to the proceeding is of the opinion that, substantial injustice has been caused by the defect or irregularity and the injustice cannot be remedied by any order of the court. (2) A defect or irregularity in the appointment or election of a receiver, trustee or member of a committee of inspection shall not vitiate any act done by him in good faith. - 133 Verify source ↗
Exemption of deeds, etc., from stamp duty
AI-assisted research summary: Certain bankruptcy-related instruments are exempt from stamp duty, except for fees under the Act.
133.–(1) A deed, conveyance, assignment or other assurance relating solely to freehold or leasehold property, or to any mortgage, charge or other incumbrance on, or any estate, right or interest in any movable or immovable property which is part of the estate of any bankrupt, and which, after the execution of the deed, conveyance, assignment or other assurance, either at law or in equity, is or remains the estate of the bankrupt or of the trustee under the bankruptcy, and a power of attorney, proxy paper, writ, order, certificate, affidavit, bond or other instrument 481 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] or writing relating solely to the property of any bankrupt, or to any proceeding under any bankruptcy, shall be exempt from stamp duty, except in respect of fees under this Act. (2) For the purposes of this section “bankruptcy” shall include any proceeding under this Act whether before or after adjudication and “bankrupt” shall include any debtor proceeded against under this Act. Acts of corporations, partners, etc. - 134 Verify source ↗
Acts of corporations, partners, etc
AI-assisted research summary: Corporations, firms, and lunatics may act through specified representatives for the purposes of this Act.
134. For all or any of the purposes of this Act, a corporation may act by any of its officers authorised in that behalf under the seal of the corporation, a firm may act by any of its members, and a lunatic may act by his guardian or the appointed manager of his estate. Certain provisions to bind United Republic - 135 Verify source ↗
Certain provisions to bind United Republic
AI-assisted research summary: This section says that, unless the Act provides otherwise, certain parts of the Act bind the United Republic.
135. Save as provided in this Act, the provisions of this Act relating to the remedies against the property of a debtor, the priorities of debts, the effect of a composition or scheme of arrangement, and the effect of a discharge, shall bind the United Republic. Unclaimed and undistributed dividends or funds under this Act Cap. 26 (f) Unclaimed Funds or Dividends - 136 Verify source ↗
Unclaimed and undistributed dividends or funds under this Act
AI-assisted research summary: Trustees must pay certain unclaimed dividends or undistributed money into the Bankruptcy Estates Account, and the official receiver must issue a receipt.
136.–(1) Where the trustee under any bankruptcy composition or scheme pursuant to this Act, has under his control any unclaimed dividend which has remained unclaimed for more than six months, or where, after making a final dividend, he has in his hands or under his control any unclaimed or undistributed money arising from the property of the debtor, he shall forthwith pay it to the Bankruptcy Estates Account at the prescribed bank, and the official receiver shall furnish him with a certificate of receipt of the money paid, which shall be an effectual discharge to him in respect thereof. (2) Where any unclaimed or undistributed funds or dividends in the hands or under the control of any trustee or other person empowered to collect, receive, or distribute any funds or dividends under the Deeds of Arrangement Act have remained or remain unclaimed or undistributed for six months after they 482 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] become claimable or distributable, or in any other case for two years after the receipt thereof by the trustee or other person, it shall be the duty of the trustee or other person forthwith to pay them to the Bankruptcy Estates Account at the prescribed bank, and the official receiver shall furnish the trustee or other person with a certificate or receipt of the money paid, which shall be an effectual discharge to him in respect thereof: Provided that, the official receiver may- (a) at any time order any trustee or other person to submit to him an account verified by affidavit of the sums received and paid by him as aforesaid, and may direct and enforce an audit of the account; or (b) appoint a person to collect and get in unclaimed or undistributed funds or dividends, and for purposes of this section, the court shall have and, at the instance of the official receiver, may exercise, the powers conferred by this Act with respect to the discovery and realisation of the property of a debtor, and the provisions of Part II of this Act with respect thereto shall, with any necessary modifications, apply to proceedings under this section. (3) The provisions of this section shall not, except as expressly declared herein, deprive any person of any large or other right or remedy to which he may be entitled against the trustee or other person. (4) Where any unclaimed dividends or undistributed money paid into the Bankruptcy Estates Account in pursuance of this section shall have remained in that account for a period of two years, the official receiver shall transfer the money to the credit of the Bankruptcy Contingency Fund. (5) A person claiming to be entitled to any moneys paid into the Bankruptcy Estates Account or the Bankruptcy Contingency Fund pursuant to this section, may apply to the official receiver for payment to him of the same, and the official receiver, where satisfied that, the person claiming is entitled, shall make an order for the payment to the person of the sum due, and where the money claimed has been paid to 483 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Fraudulent debtors Ords. Nos. 45 of 1947 s. 22 20 of 1958 s. 20 the credit of the Bankruptcy Contingency Fund and the said fund is insufficient to meet the sum required to be paid, the deficiency shall be met by the Accountant General out of the public revenue. (6) A person dissatisfied with the decision of the official receiver in respect of his claim may appeal to the court. PART VIII BANKRUPTCY OFFENCES
Part
PART VIII
- 137 Verify source ↗
Fraudulent debtors
AI-assisted research summary: A bankrupt person commits an offence if they hide, fail to disclose, dispose of, falsify, or otherwise misuse property, books, debts, or financial information in the ways listed here.
137.–(1) A person who has been adjudged bankrupt or in respect of whose estate a receiving order has been made shall in each of the following cases commit an offence where- (a) he does not to the best of his knowledge and belief fully and truly discover in the trustee his property, movable and immovable, and how and to whom and for what consideration and when he disposed of any part thereof, except the part as has been disposed of in the ordinary way of his trade (if any) or laid out in the ordinary expense of his family, unless he proves that he had no intent to defraud; (b) he does not deliver up to the trustee, or as he directs, the part of his movable and immovable property as is in his custody or under his control, and which he is required by law to deliver up, unless he proves that he had no intent to defraud; (c) he does not deliver up to the trustee, or as he directs, books, documents, papers and writings relating to his property or affairs, unless he proves that he had no intent to defraud; (d) after the presentation of a bankruptcy petition by or against him, or within two years next before the presentation, he conceals any part of his property to the value of two hundred shillings or upwards, or conceals any debt due to or from him, unless he proves that he had no intent to defraud; 484 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (e) after the presentation of a bankruptcy petition by or against him, or within two years next before the presentation, he fraudulently removes any part of his property to the value of two hundred shillings or upwards; (f) he makes any material omission in any statement relating to his affairs, unless he proves that he had no intent to defraud; (g) knowing or believing that a false debt has been proved by any person under the bankruptcy, he fails for the period of a month to inform the trustee thereof; (h) after the presentation of a bankruptcy petition by or against him, he prevents the production of any book, document, paper, or writing affecting or relating to his property or affairs, and unless he proves that he had no intent to conceal the state of his affairs or to defeat the law; (i) after the presentation of a bankruptcy petition by or against him, or within two years next before the presentation, he conceals, destroys, mutilates, or falsifies, or is privy to the concealment, destruction, mutilation or falsification of any book or document affecting or relating to his property or affairs, unless he proves that he had no intent to conceal the state of his affairs or to defeat the law; (j) after the presentation of a bankruptcy petition by or against him, or within two years next before the presentation, he makes or is privy to the making of any false entry in any book or document affecting or relating to his property or affairs, unless he proves that he had no intent to conceal the state of his affairs or to defeat the law; (k) after the presentation of a bankruptcy petition by or against him, or within two years next before the presentation, he fraudulently parts with, alters, or makes any omission in, or is privy to the fraudulently parting with, altering, or making any omission in any document affecting or relating to his property or affairs; 485 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (l) after the presentation of a bankruptcy petition by or against him, or at any meeting of his creditors within two years next before the presentation, he attempts to account for any part of his property by fictitious losses or expenses; (m) within two years next before the presentation of a bankruptcy petition by or against him, or after the presentation of a bankruptcy petition and before the making of a receiving order, he, by any false representation or other fraud, has obtained any property on credit and has not paid for the same; (n) within two years next before the presentation of a bankruptcy petition by or against him, or after the presentation of a bankruptcy petition and before the making of a receiving order, he obtains under the false pretence of carrying on business, and, where a trader of dealing in the ordinary way of his trade, any property on credit and has not paid for the same, unless he proves that he had no intent to defraud; (o) within two years next before the presentation of a bankruptcy petition by or against him, or after the presentation of a bankruptcy petition and before the making of a receiving order, he pawns, pledges, or disposes of any property which he has obtained on credit and has not paid for, unless, in the case of a trader, pawning, pledging, disposing in the ordinary way of his trade, and unless in any case he proves that he had no intent to defraud; (p) he is guilty of any false representation or other fraud for the purpose of obtaining the consent of his creditors or any of them to an agreement with reference to his affairs or to his bankruptcy; (q) he makes default in payment for the benefit of creditors of any portion of a salary or other income in respect of the payment of which the court is authorised to make an order; 486 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (r) within one year preceding the date of the receiving order, he has continued to trade or carry on business after knowing himself to be insolvent; (s) within six months next before the making of a receiving order, he sells goods at a price lower than cost, unless he proves that he had no intention to defraud his creditors; and (t) he has contracted any debt provable in the bankruptcy without having at the time of contracting it any reasonable or probable ground of expectation (proof whereof shall lie on him) of being able to pay it. (2) For the purpose of subsection (1), the expression “trustee” means the official receiver of the debtor’s estate or trustee administering his estate for the benefit of his creditors. (3) A person who commits an offence in the cases mentioned in subsection (1) on conviction shall be liable to imprisonment for a term not exceeding three years except in the cases mentioned respectively in paragraphs (m), (n) and (o) where on conviction shall be liable to imprisonment for a term not exceeding five years. (4) Where a person pawns, pledges or disposes of any property in circumstances which amount to an offence under paragraph (o) of subsection (1), a person who takes in pawn or pledge or otherwise receives the property knowing it to be pawned, pledged or disposed of in the circumstances aforesaid commit an offence and on conviction shall be liable to imprisonment for term not exceeding five years. Undischarged bankrupt obtaining credit Ord. No. 39 of 1960 s. 3
Part
part thereof, except the part as has been disposed of in
- 138 Verify source ↗
Undischarged bankrupt obtaining credit
AI-assisted research summary: An undischarged bankrupt or insolvent person must not get credit of 100 shillings or more without saying so, and must not trade or do business under another name without disclosing the bankruptcy name.
138. Where a person who has been adjudged bankrupt or insolvent in the United Republic or any reciprocating territory and has not obtained his discharge- (a) either alone or jointly with any other person obtains credit to the extent of one hundred shillings or upwards from any person without informing that person that he is an undischarged bankrupt; or 487 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Frauds by bankrupts, etc. Ord. No. 39 of 1960 s. 4 Bankrupt guilty of gambling, etc. (b) engages in any trade or business under a name other than that under which he was adjudged bankrupt without disclosing to persons with whom he enters into any business transaction, the name under which he was adjudged bankrupt, commits an offence, and on conviction shall be liable to imprisonment for a term not exceeding five years. - 139 Verify source ↗
Frauds by bankrupts, etc
AI-assisted research summary: A bankrupt person, or a person whose estate is under a receiving order, commits an offence if they obtain credit by fraud, move or charge property to defraud creditors, or hide/remove property to defraud creditors.
139.–(1) Where a person who has been adjudged bankrupt or in respect of whose estate a receiving order has been made- (a) in incurring any debt of liability has obtained credit under false pretences or by means of any other fraud; (b) with intent to defraud his creditors or any of them, has made or caused to be made any gift or transfer of, or charge on his property; or (c) with intent to defraud his creditors, has concealed or removed any part of his property since, or within two months before the date of any unsatisfied judgment or order for payment of money obtained against him, commits an offence, and on conviction shall be liable to imprisonment for a term not exceeding five years. (2) For the purposes of paragraph (b) of subsection (1) of this section, it is hereby declared that where a person who has been adjudged bankrupt, or in respect of whose estate a receiving order has been made, has with intent to defraud his creditors or any of them caused or connived at the levying of any execution against his property, he shall be deemed to have made a transfer of or charge on his property. - 140 Verify source ↗
Bankrupt guilty of gambling, etc
AI-assisted research summary: A bankrupt person can commit an offence if, in the stated bankruptcy and debt circumstances, they gamble, make rash speculation losses, or fail to explain a substantial estate loss; prosecution needs a court order.
140.–(1) A person who has been adjudged bankrupt, or in respect of whose estate a receiving order has been made, commits an offence, where, having engaged in any trade or business, and having outstanding at the date of the receiving order any debts contracted in the course and for the purposes of trade or business- (a) he has, within two years prior to the presentation of the bankruptcy petition, materially contributed to or 488 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] increased the extent of his insolvency by gambling or by rash and hazardous speculations, and the gambling or speculations are unconnected with his trade or business; (b) he has, between the date of the presentation of the petition and the date of the receiving order, lost any part of his estate by gambling or rash and hazardous speculation as aforesaid; or (c) on being required by the official receiver at any time, or in the course of his public examination by the court, to account for the loss of any substantial part of his estate incurred within a period of a year next preceding the date of the presentation of the bankruptcy petition, or between that date and the date of the receiving order, he fails to give a satisfactory explanation of a manner in which the loss was incurred: Provided that, in determining for the purposes of this section whether any speculations were rash and hazardous, the financial position of the accused person at the time when he entered into the speculations shall be taken into consideration. (2) A prosecution shall not be instituted against any person under this section except by order of the court.
Part
part of his estate by gambling or rash and hazardous
- 141 Verify source ↗
Bankrupt failing to keep proper accounts
AI-assisted research summary: A bankrupt person may commit an offence if they fail to keep or preserve proper business accounts.
141.–(1) A person who has been adjudged bankrupt or in respect of whose estate a receiving order has been made commits an offence, where, having been engaged in any trade or business during any period in the three years immediately preceding the date of the presentation of the bankruptcy petition, he has not kept proper books of account throughout that period and throughout any further period in which he was engaged between the date of the presentation of the petition and the date of the receiving order, or has not preserved books of account kept: Provided that, a person who has not kept or has not preserved books of account shall not be convicted of an offence under this section where- (a) his unsecured liabilities at the date of the receiving order did not exceed, in the case of a person who has 489 Bankrupt failing to keep proper accounts Ord. No. 45 of 1947 s. 24 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] not on any previous occasion been adjudged bankrupt or insolvent or made a composition or arrangement with his creditors in Tanzania or any reciprocating territory, five thousand shillings, or in any other case one thousand shillings; or (b) he proves that, in the circumstances in which he traded or carried on business the omission was honest and excusable. (2) A prosecution shall not be instituted against any person under this section except by order of the court. (3) For the purposes of this section, a person shall be deemed not to have kept proper books of account where he has not kept books or accounts as are necessary to exhibit or explain his transactions and financial position in his trade or business, including a book or books containing entries from day to day in sufficient detail of cash received and cash paid, and, where the trade or business has involved dealings in goods, statements of annual stock takings, and (except in the case of goods sold by way of retail trade to the actual consumer) accounts of goods sold and purchased showing the buyers and sellers thereof in sufficient detail to enable the goods and the buyers and sellers thereof to be identified. - 142 Verify source ↗
Bankrupt absconding
AI-assisted research summary: A bankrupt person, or a person with a receiving order over their estate, must not leave Tanzania or prepare to leave after a bankruptcy petition is presented, unless they can prove they had no intent to defraud.
142. Where a person who is adjudged bankrupt, or in respect of whose estate a receiving order has been made, after the presentation of a bankruptcy petition by or against him, or within six months before the presentation, quits Tanzania, or attempts to make preparation to quit Tanzania, (unless he proves that he had no intent to defraud) commits an offence. - 143 Verify source ↗
False claim, etc
AI-assisted research summary: A creditor, or someone claiming to be a creditor in bankruptcy proceedings, commits an offence if they make a false claim or submit a proof, declaration, or statement of account that is untrue in any material respect, unless they prove there was no intent to defraud.
143. Where a creditor, or a person claiming to be a creditor in any bankruptcy proceedings, makes any false claim, or any proof, declaration or statement of account, which is untrue in any material particular commits an offence, unless he proves that he had no intent to defraud. 490 Bankrupt absconding Ord. No. 20 of 1958 s. 21 False claim, etc. Ord. No. 45 of 1947 s. 26 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Order by court for prosecution on report of trustee - 144 Verify source ↗
Order by court for prosecution on report of trustee
AI-assisted research summary: If specified bankruptcy-related reports or presentations persuade the court that an offence may have been committed and prosecution looks likely and desirable, the court must order prosecution of the debtor.
144. Where an official receiver or trustee in a bankruptcy reports to the court that, in his opinion a debtor who has been adjudged bankrupt or in respect of whose estate a receiving order has been made has committed an offence under this Act, or where the court is satisfied upon the presentation of any creditor or member of the committee of inspection that, there is ground to believe that the debtor has committed any such offence, the court shall, where it appears to it that, there is a reasonable probability that the debtor will be convicted, and the circumstances render a prosecution desirable, order that the debtor be prosecuted for the offence. Criminal liability after discharge or composition - 145 Verify source ↗
Criminal liability after discharge or composition
AI-assisted research summary: A debtor who has committed a criminal offence cannot avoid being proceeded against just because they have been discharged or a composition or scheme of arrangement has been accepted or approved.
145. Where a debtor has committed any criminal offence, he shall not be exempted from being proceeded against therefor by reason that, he has obtained his discharge or a composition or scheme of arrangement has been accepted or approved. General penalty Ords. Nos. 45 of 1947 s. 26 39 of 1960 - 146 Verify source ↗
General penalty
AI-assisted research summary: A person who commits an offence under the Act may face imprisonment of up to three years if no specific penalty is provided on conviction.
146. A person who commits an offence under this Act, where a specific penalty is not provided on conviction shall be liable to imprisonment for a term not exceeding three years. Form of charge - 147 Verify source ↗
Form of charge
AI-assisted research summary: A charge for an offence under this Act is enough if it states the substance of the offence in the Act’s words, or words close enough to them.
147. In a charge for an offence under this Act, it shall be sufficient to set forth the substance of the offence charged in the words of this Act specifying the offence, or as near thereto as circumstances admit, without alleging or setting forth any debt, act of bankruptcy, trading adjudication, or any proceedings in or order, warrant or document of the court acting under this Act. Director of Public Prosecutions to act in certain cases Act No. 1 of 2008 s. 32 - 148 Verify source ↗
Director of Public Prosecutions to act in certain cases
AI-assisted research summary: When a court orders a prosecution for certain offences, the Director of Public Prosecutions must conduct it, but in some bankruptcy cases the official receiver may do so before a subordinate court.
148. Where the court orders the prosecution of any person for any offence under this Act or for any offence arising out of or connected with any bankruptcy proceedings, it shall be the duty of the Director of Public Prosecutions to institute and carry on the prosecution: Provided that, where the order of the court is made on the application of the official receiver and based on his report, the official receiver may institute the prosecution and carry 491 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] on the proceedings, if or so long as those proceedings are conducted before a subordinate court, unless in the court thereof circumstances arise which render it desirable that the remainder of the proceedings should be carried on by the Director of Public Prosecutions. Evidence as to frauds by agents - 149 Verify source ↗
Evidence as to frauds by agents
AI-assisted research summary: A statement or admission made in a compulsory bankruptcy examination or deposition before the court cannot be used as evidence against that person in a proceeding about frauds by agents, bankers, or factors.
149. A statement or admission made by a person in any compulsory examination or deposition before the court on the hearing of any matter in bankruptcy shall not be admissible as evidence against that person in any proceeding in respect of any offence relating to frauds by agents, bankers or factors. PART IX PROVISION FOR RECIPROCITY WITH OTHER COUNTRIES Declaration of reciprocating countries and courts GN. No. 478 of 1962
Part
PART IX
- 150 Verify source ↗
Declaration of reciprocating countries and courts
AI-assisted research summary: The Minister responsible for legal affairs may declare a country and its bankruptcy court to be reciprocating for this Act if that country has matching reciprocity rules.
150. Where the Minister responsible for legal affairs is satisfied that, the legislature of any country has enacted provisions for reciprocity in bankruptcy which in that country have the like effect as the provisions contained in this Part of this Act, the Minister may by order declare that country to be a reciprocating country and the court thereof having jurisdiction in bankruptcy, a reciprocating court for the purposes of this Act, and as from the date of publication of the order in the Gazette, the provisions of this Part of this Act shall apply to bankruptcy proceedings subsequently instituted in the declared country against a debtor having property in Tanzania. Local effect of receiving order, etc., made by reciprocating court against debtor having property in Tanzania - 151 Verify source ↗
Local effect of receiving order, etc., made by reciprocating court
AI-assisted research summary: If certain bankruptcy orders or appointments are made in a reciprocating country, they have the same effect in Tanzania as if made under this Act.
151. Where a receiving order or order of adjudication or any appointment of a special manager or interim receiver has been made in any reciprocating country in bankruptcy proceedings against a bankruptcy having property in Tanzania, the order or appointment shall, subject to the other provisions of this Part of this Act, have the like effect as if it had been made in bankruptcy proceedings against the debtor in Tanzania, and the debtor and his creditors shall be deemed to be in the 492 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Vesting of bankrupt’s local property in trustee appointed in reciprocating country Local powers of official receiver, etc., appointed in reciprocating country same position and have the same rights and privileges, and be subject to the same disqualifications, restrictions, obligations and liabilities in respect as if the order or appointment had been made under this Act.
Part
Part of this Act, have the like effect as if it had been made in
- 152 Verify source ↗
Vesting of bankrupt’s local property in trustee appointed in
AI-assisted research summary: If a reciprocating court makes an order of adjudication, the bankrupt’s property in Tanzania vests in the trustee in the reciprocating country.
152. Where an order of adjudication is made by a reciprocating court, the property of the bankrupt situated in Tanzania shall, by virtue of the order, vest in the person discharging the office of trustee of the property of the bankrupt in the reciprocating country, in the same manner as if the order of adjudication and the appointment of trustee had been made in Tanzania, and the superintendence of the trustee shall continue to be exercised by the committee of inspection appointed in the reciprocating country or where there be no committee, by the reciprocating court. - 153 Verify source ↗
Local powers of official receiver, etc., appointed in
AI-assisted research summary: A reciprocating-country receiver, interim receiver, special manager, or trustee handling a bankruptcy matter involving property in Tanzania is responsible for the proceedings and the debtor’s affairs in Tanzania, subject to court control.
153. The official receiver, interim receiver, special manager or trustee of a reciprocating country officiating in bankruptcy proceedings against a debtor having property in Tanzania shall, subject to the control of the court by which he is appointed, be solely responsible for conducting those proceedings, and managing the affairs of the debtor or bankrupt within Tanzania, and for that purposes shall, in his respective capacity, have the same powers, rights, duties, obligations and liabilities as if he had derived his authority under this Act and in any proceedings where by this Act, a debtor, creditor or other person interested is required to do any act at the direction of an official receiver, interim receiver, special manager or trustee, or is permitted by this Act to move in any matter in connection with the proceedings, every debtor, creditor or person interested shall do the act at the direction of, and in the matter treat and negotiate with or proceed against the official receiver, interim receiver, special manager or trustee as the case may be of the reciprocating country, except in so far as any official may have delegated his authority to the official receiver of the United Republic as his agent in the manner hereinafter provided. 493 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Local official receiver to act as agent of official receiver etc., of reciprocating country Mode of requesting official receiver to act as agent Ord. No. 20 of 1958 s. 22 - 154 Verify source ↗
Local official receiver to act as agent of official receiver etc., of
AI-assisted research summary: Certain bankruptcy officers from a reciprocating country may ask the United Republic’s official receiver to act as their agent, and that official receiver must comply.
154. An official receiver, interim receiver, special manager or trustee of a reciprocating country officiating in bankruptcy proceedings against a debtor having property in the United Republic may require the official receiver of the United Republic to act as his agent either in regard to any specific matter, or generally to take steps as may be lawful under this Act for the discovery, seizure, protection, disclaimer or realisation of any property of the bankrupt situated within the United Republic, and in that event it shall be the duty of the official receiver of the United Republic to act accordingly. - 155 Verify source ↗
Mode of requesting official receiver to act as agent
AI-assisted research summary: A request to act as agent must be made and published in the Gazette, and the official receiver then gets the specified powers and duties once the request is received and filed.
155.–(1) The request to act as agent as aforesaid shall be made in the manner prescribed under this Act, and be published as a notice in the Gazette, and as from the date of the request and without further formality or authority, the official receiver shall, as regards the debtor or bankrupt and his property and creditors situated in the United Republic and for the purposes for which he is authorised, have the same rights, powers and duties as are conferred under the provisions of this Act upon an official receiver, interim receiver, special manager or trustee as the case may be: Provided that, nothing herein contained shall be taken to confer on the official receiver any interest or title in any property otherwise than as an agent as aforesaid. (2) On the receipt of the prescribed request, the official receiver shall file with the registrar of the High Court, the original or a properly authenticated copy of the request, and upon filing, the court shall take judicial notice of the appointment as agent under the provisions of this Part. (3) Notwithstanding the provisions of subsection (1), the official receiver may in any case, in which it is made to appear to him that, immediate action is desirable, commence discharging his duties as agent as aforesaid in any manner applicable to the circumstances, where upon receipt of telegraphic or other information he is satisfied that- (a) bankruptcy proceedings have been instituted in a reciprocating country against a debtor having property in the United Republic; 494 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (b) the prescribed request for him to act has been signed and dispatched; and (c) he has been indemnified against costs, charges and expenses to be incurred by him. (4) Unless the contrary intention appears, the request to act as agent sent to the official receiver of the United Republic shall be deemed to permit him to delegate at his discretion, the powers and duties vested in him as agent to any deputy official receiver appointed in pursuance of this Act. - 156 Verify source ↗
Duties of official receiver acting as agent
AI-assisted research summary: The official receiver must pass on the estate money he receives, after deducting properly incurred expenses.
156. It shall be the duty of the official receiver of the United Republic to remit the proceeds of the realisation of the property of the bankrupt and other money of the estate coming into his hands as the agent as aforesaid, to the person for whom he is acting, after deducting the expenses as may have been properly incurred by him; and the distribution among the creditors of the money shall be carried out in accordance with the law of the reciprocating territory in which the adjudication order was made. - 157 Verify source ↗
Transmission of proofs of local debts
AI-assisted research summary: If a reciprocal-country insolvency order exists and the United Republic’s official receiver is acting as agent, local proofs of debts may be filed with the local official receiver, who must receive, process, and forward them as prescribed.
157. Where a receiving order or an order of adjudication has been made in a reciprocating country and the official receiver of the United Republic is acting as agent in the manner hereinbefore provided, proofs of debts contracted by the debtor in the United Republic may be filed with the local official receiver in the form prescribed by the law of the reciprocating country, and in that case it shall be his duty to receive, deal with and forward in the manner prescribed by the rules made under this Part of this Act the proofs to the official receiver or trustee, as the case may be, of the reciprocating country. - 158 Verify source ↗
Power of local court to make orders
AI-assisted research summary: The court may, on application, use certain powers over a debtor’s person, property, and affairs when bankruptcy proceedings have been started in a reciprocating court and the debtor has property in the United Republic.
158. Where on the application of the official receiver or any creditor or other person interested, it appears to the court that, bankruptcy proceedings have been instituted in a reciprocating court against a debtor having property situated in the United Republic, the court may, notwithstanding that, proceedings have not been instituted in the United Republic exercise as regards the person, property and affairs of the debtor, the 495 Duties of official receiver acting as agent Transmission of proofs of local debts Power of local court to make orders ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] powers conferred by sections 11 and 26 of this Act as may in the circumstances be applicable. Limitation on powers of local court to entertain proceedings - 159 Verify source ↗
Limitation on powers of local court to entertain proceedings
AI-assisted research summary: A court in Tanzania must enforce an order, warrant, or search warrant from a reciprocating court as if it had been made or issued by that court itself.
159. An order, warrant or search made or issued by a reciprocating court shall be enforced by the court in Tanzania in the same manner in respects as if the order, warrant or search warrant had been made or issued by itself. Local enforcements of warrants of reciprocating court - 160 Verify source ↗
Local enforcements of warrants of reciprocating court
AI-assisted research summary: A Tanzanian court generally must not deal with proceedings covered by this section, except in the listed situations. A reciprocating court has sole jurisdiction over the relevant bankruptcy matters.
160. Subject to the other provisions of this section, a reciprocating court shall have sole jurisdiction in matters in or of arising out of any bankruptcy proceedings taken before the court against a debtor having property in the United Republic, and a court in Tanzania shall not entertain any suit, application or other matter arising in or out of proceedings except- (a) upon the institution of any proceedings by or against the local official receiver in respect of any matters within the scope of his authority in the capacity of agent as aforesaid; (b) in the case of any civil suit or proceedings within the ordinary civil jurisdiction of the court by or against the official receiver, interim receiver, trustee of special manager of or appointed in a reciprocating country; (c) upon the institution of any proceedings affecting the property of the debtor or bankrupt situated in the United Republic; (d) upon the receipt of a request to act in aid of or be auxiliary to the reciprocating court; (e) for the public examination of the debtor in regard only to his property situated within the United Republic or his dealings with any person ordinarily resident or carrying on business in Tanzania: Provided that, the public examination shall not be held until the public examination before the reciprocating court have been concluded or adjourned sine die; (f) for the exercise of powers under Part VIII of this Act in relation to bankruptcy offences alleged to have been committed within Tanzania; 496 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Concurrent bankruptcies Ord. No. 20 of 1958 s. 23 (g) upon the institution of any proceedings for or arising out of the enforcement or execution of any order, warrant or search warrant made or issued by a reciprocating court; or (h) upon an application for the exercise of the powers conferred on the court by sections 11, 26, 27 and 55. - 161 Verify source ↗
Concurrent bankruptcies
AI-assisted research summary: This section defines concurrent bankruptcy proceedings and sets rules for which trustee or receiver controls the debtor’s property, plus when the court must rescind or may vary its orders.
161.–(1) For the purposes of this section “concurrent bankruptcy proceedings” means bankruptcy or insolvency proceedings instituted concurrently against the same debtor in any two or more reciprocating countries, one of which may or may not be Tanzania. (2) Where concurrent bankruptcy proceedings have been instituted affecting property in the United Republic, the property shall vest in the trustee appointed in the country where the order of adjudication first is made; but where two or more of the orders bear the same date or where for any reason no adjudication order is made, then the property shall vest in or be administered by the trustee or receiver of the territory where the receiving order is first made. (3) In any case where concurrent bankruptcy proceedings have been instituted in Tanzania and in pursuance of subsection (2) and (4) hereof, the property of the debtor or bankrupt situated in the United Republic vests in or is administered by a trustee or receiver in a reciprocating country, the court shall rescind its receiving order and annul its order of adjudication, if made, or dismiss the petition upon the terms, if any, as the court may think fit, and the rescission of a receiving order or an annulment of adjudication under this subsection shall not invalidate any acts lawfully done by the receiver or trustee of the United Republic or any other person lawfully acting under the authority of either of them. (4) Notwithstanding the other provisions of this section, in any case where concurrent bankruptcy proceedings have been instituted in Tanzania, the court may, after the inquiry and reference to the reciprocating courts as it deems fit, order 497 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Power of official receiver, etc., of Tanzania to require official receiver in reciprocating country to act as his agent Ord. No. 20 of 1958 s. 24 that the property of the debtor situated in the United Republic shall vest in or be administered by a trustee or receiver in the United Republic in some reciprocating country other than that determined under the provisions of subsection (2) hereof where, upon an application by the official receiver or any creditor or other person interested, it appears that, a majority of the creditors in number and value are resident in the United Republic or other reciprocating country, and that from the situation of the property of the debtor or bankrupt or other causes, his estate and effects may be more conveniently administered, managed and distributed in Tanzania or other reciprocating country. - 162 Verify source ↗
Power of official receiver, etc., of Tanzania to require official receiver
AI-assisted research summary: The official receiver, trustee, interim receiver, or special manager must take lawful steps in a reciprocating country to administer the debtor’s or bankrupt’s property, and may request a bankruptcy official there to act as agent.
162.–(1) Where a receiving order or an order of adjudication is made in Tanzania against a debtor or bankrupt having property situated in a reciprocating country and where under the provisions of this Act, the property of the debtor or bankrupt is administered by or vested in the official receiver or a trustee of or appointed in Tanzania, it shall be the duty of the official receiver or trustee and any interim receiver or special manager appointed in pursuance of this Act to take steps as may be lawful in any reciprocating territory for the proper administration of any property of the debtor or bankrupt situated in the territory and at his discretion and without further authority to request in the prescribed manner any bankruptcy official in the country empowered in that behalf, to act as his agent either generally or for any specific purpose, and to give directions and publish notices and do things in the reciprocating country as may be lawful for the administration of the estate, and unless for any reason to the contrary intention is expressed, a request sent to a bankruptcy official in a reciprocating country requiring him to act as an agent as aforesaid shall contain a consent that, he may assign the powers and duties vested in him as agent to his deputy or any officer ordinarily authorised to act for him in the reciprocating country. 498 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Power to make special rules under this Part GN. No. 478 of 1962 (2) Where in any proceedings mentioned in subsection (1), the official receiver, interim receiver, special manager or trustee shall have completed and dispatched to a reciprocating country, a request to a bankruptcy official therein to act as his agent as aforesaid and where the circumstances of the case require, he may request bankruptcy official by telegram or otherwise to act as his agent until the time as the prescribed request shall arrive in the ordinary course of post, and when making any request undertake to indemnify bankruptcy official against any costs, charges and expenses which the latter may incur in acting as agent as aforesaid. - 163 Verify source ↗
Power to make special rules under this Part
AI-assisted research summary: The Chief Justice may make rules for this Part, with the Minister’s approval, and may also make rules to extend or vary time limits in certain reciprocal bankruptcy cases. Those special rules do not take effect until the Chief Justice publishes a Gazette notice confirming similar rules exist in reciprocal countries.
163.–(1) The Chief Justice may, with the approval of the Minister responsible for legal affairs, make rules for the purpose of carrying into effect all or any of the objects of this part of this Act, and in addition and for the purpose, shall have power to make rules extending or varying the time limited under this Act or any rules made under section 121 thereof for the doing of any act or taking any proceeding, in so far as the limitation of time affects persons ordinarily resident or carrying on business in a reciprocating country, who are or may be interested in any bankruptcy proceedings in Tanzania against a debtor having property in the reciprocating country: Provided that, the rules made under the powers conferred by this subsection shall not come into force until the Chief Justice shall, by notice in the Gazette, declare his satisfaction that, the rule making authorities in reciprocating countries have made rules having the like effect within their respective countries. (2) Notwithstanding the provisions of subsection (1), the court may in respect of any particular matter exercise its general powers of extension of time under section 104 (4) of this Act, in favour of a person ordinarily residing or carrying on business in a reciprocating country, who is interested in bankruptcy proceedings instituted in Tanzania against a debtor having property in the reciprocating country. 499 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] First meeting of creditors Ord. No. 20 of 1958 s. 25 Subsequent meetings Chairman Voting FIRST SCHEDULE (Made under section 15) MEETINGS OF CREDITORS
Part
part of this Act, and in addition and for the purpose, shall have
- 1 Verify source ↗
Short title
AI-assisted research summary: The official receiver must summon the first meeting of creditors within 60 days after the receiving order, unless the court allows a later day, and must give notice in the Gazette and to each creditor.
1.–(1) The first meeting of creditors shall be summoned for a day not later than sixty days after the date of the receiving order, unless the court for any special reason deems it expedient that, the meeting be summoned for a later day. (2) The official receiver shall summon the meeting by giving not less than six clear days’ notice of the time and place thereof in the Gazette. (3) The official receiver shall also, as soon as practicable, send to each creditor mentioned in the debtor’s statement of affairs, a notice of the time and place of the first meeting of creditors, accompanied by a summary of the debtor’s statement of affairs, including the cause of his failure, and any observation thereon, which the official receiver may think fit to make; but the proceedings at the first meeting shall not be invalidated by reason of any notice or summary not having been sent or received before the meeting. (4) The meeting shall be held at the place as is in the opinion of the official receiver most convenient for the majority of the creditors. (5) The official receiver or the trustee may at any time summon a meeting of creditors, and shall do so whenever directed by the court, or requested by a creditor in accordance with the provisions of this Act. - 2 Verify source ↗
Interpretation
AI-assisted research summary: For meetings after the first one, the person calling the meeting must send notice of the time and place to each creditor.
2. Meetings subsequent to the first meeting shall be summoned by sending notice of the time and place thereof to each creditor at the address given in his proof or where he has not proved, at the address given in the debtor’s statement of affairs, or at other address as may be known to the person summoning the meeting. - 3 Verify source ↗
Acts of bankruptcy
AI-assisted research summary: The official receiver, or someone he nominates, must chair the first meeting. Later meetings use a chairman appointed by resolution of the meeting.
3. The official receiver, or some person nominated by him, shall be the chairman at the first meeting and the chairman at subsequent meetings shall be a person as the meeting may by resolution appoint. - 4 Verify source ↗
Bankruptcy notice
AI-assisted research summary: Creditors may vote only if they have proved and lodged a provable bankruptcy debt; secured creditors must disclose security details and can vote only on the unsecured balance.
4.–(1) A person shall not be entitled to vote as a creditor at the first or any other meeting of creditors unless he has duly proved a debt provable in bankruptcy to be due to him from the debtor, and the proof has been duly lodged before the time appointed for the meeting. (2) A creditor shall not vote at any meeting in respect of any unliquidated or contingent debt, or any debt the value of which is not ascertained. 500 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] (3) For the purpose of voting, a secured creditor shall, unless he sur- renders his security, state in his proof the particulars of his security, the date when it was given, and the value at which he assesses it, and be entitled to vote only in respect of the balance (if any) due to him, after deducting the value of his security, and where he votes in respect of his whole debt, he shall be deemed to have surrendered his security unless the court on application is satisfied that, the omission to value his secu- rity has arisen from inadvertence. (4) A creditor shall not vote in respect of any debt on or secured by a current bill of exchange or promissory note held by him, unless he is willing to treat the liability to him thereon of every person who is liable thereon antecedently to the debtor, and against whom a receiving order has not been made, as a security in his hands, and to estimate the value thereof, and for the purposes of voting, but not for the purposes of div- idend, to deduct it from his proof. - 5 Verify source ↗
Jurisdiction to make receiving order
AI-assisted research summary: The trustee or official receiver may require a creditor to surrender security within 28 days after its value has been used in voting, on payment of the estimated value plus 20% unless the creditor first corrects the valuation by new proof.
5. It shall be competent to the trustee or to the official receiver, within twenty- eight days after a proof estimating the value of a security as aforesaid has been made use of in voting at any meeting, to require the creditor to give up the security for the benefit of the creditors generally on payment of the value estimated with an addition thereto of twenty per centum: Provided that, where a creditor has put a value on a security, he may, at any time before he has been required to give up the security as afore- said, correct the valuation by a new proof and deduct a new value from his debt, but in that case the addition of twenty per centum shall not be made where the trustee requires the security to be given up. - 6 Verify source ↗
Conditions on which creditor may petition
AI-assisted research summary: If a receiving order is made against one partner of a firm, a qualifying creditor may prove the debt and vote at creditors’ meetings.
6. Where a receiving order is made against one partner of a firm, any creditor to whom that partner is indebted jointly with the other partners of the firm, or any of them, may prove his debt for the purpose of voting at any meeting of creditors, and be entitled to vote thereat. - 7 Verify source ↗
Proceedings and order on creditor’s petition
AI-assisted research summary: The chairman of a meeting may admit or reject a proof for voting, and that decision can be appealed to court.
7. The chairman of a meeting shall have power to admit or reject a proof for the purpose of voting, but his decision shall be subject to appeal to the court, and where he is in doubt, the proof of a creditor should be admitted or rejected, he shall mark the proof as objected to, and allow the creditor to vote, subject to the vote being declared invalid in the event of the objection being sustained. Trustees may redeem security Firms Power of chairman Proxies - 8 Verify source ↗
Debtor’s petition and order thereon
AI-assisted research summary: A creditor may vote in person or by proxy, but proxy instruments must follow the stated form and timing rules.
8.–(1) A creditor may vote either in person or by proxy. (2) An instrument of proxy shall be in the prescribed form, and is- sued by the official receiver of the debtor’s estate or by any deputy offi- cial receiver, or, after the appointment of a trustee, by the trustee, and every insertion therein shall be in the handwriting of the person giving 501 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] the proxy, or of any manager or clerk, or other person in his regular em- ployment or of any person authorised to administer oaths in the court. (3) General and special forms of proxy shall be sent to the creditors, together with a notice summoning a meeting of creditors, and neither the name nor the description of the official receiver, or of any other per- son, shall be printed or inserted in the body of any instrument of proxy before it is so sent. (4) A creditor may give a general proxy to his manager or clerk, or any other person in his regular employment, and in that case, the instrument of proxy shall state the relation in which the person to act thereunder stands to the creditor. (5) A creditor may give a special proxy to any person to vote at any specified meeting or adjournment thereof on any of the following matters: (a) for or against any specific proposal for a composition or scheme of arrangement; (b) for or against the appointment of any specified person as trustee at a specified rate of remuneration, or as member of the committee of inspection, or for or against the continuance in office of any specified person as trustee or member of a committee of inspection; or (c) on questions relating to any matter other than those above referred to, arising at any specified meeting or adjournment thereof. (6) A proxy shall not be used unless it is deposited with the official receiver or trustee before the meeting at which it is to be used. (7) Where it appears to the satisfaction of the court that, any solici- tation has been used by or on behalf of a trustee or receiver in obtaining proxies, or in procuring the trusteeship or receivership, except by the direction of a meeting of creditors, the court shall have power, where it thinks fit, to order that a remuneration shall not be allowed to the person by whom or on whose behalf the solicitation may have been ex- ercised, notwithstanding any resolution of the committee of inspection or of the creditors to the contrary. (8) A creditor may appoint the official receiver to act in manner pre- scribed as his general or special proxy. Adjournment - 9 Verify source ↗
Effect of receiving order
AI-assisted research summary: The chairman of a meeting may adjourn the meeting, but only with the meeting’s consent.
9. The chairman of a meeting may, with the consent of the meeting, adjourn the meeting from time to time and from place to place. Quorum Ord. No. 20 of 1958 s. 25 - 10 Verify source ↗
Power to appoint interim receiver
AI-assisted research summary: A creditors’ meeting cannot act unless enough creditors are present, but it may still elect a chairman, prove debts, or adjourn.
10.–(1) Except as provided in subrule (2), a meeting shall not be competent to act for any purpose, except the election of a chairman, the proving of debts, and the adjournment of the meeting, unless there are present, or represented thereat, at least three creditors, or the creditors of their number does not exceed three. 502 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Minutes Proxy holders not to vote on certain resolutions (2) Where within half- an- hour from the time appointed for the meeting, a quorum of creditors is not present or represented, the meeting may be adjourned to the other day as the chairman may ap- point, being not less than three nor more than twenty one days later, or where the creditors present resolve, or if no resolution other than that electing a chairman is passed, the meeting shall be concluded. - 11 Verify source ↗
Power to stay pending proceedings
AI-assisted research summary: The chairman of the meeting must have minutes prepared and fairly entered in the meeting book, and the minutes must be signed by the chairman or by the next meeting’s chairman.
11. The chairman of the meeting shall cause minutes of the proceedings at the meeting to be drawn up and fairly entered in a book kept for that purpose, and the minutes shall be signed by him or by the chairman of the next ensuing meeting. - 12 Verify source ↗
Power to appoint special manager
AI-assisted research summary: A proxy holder generally must not vote for resolutions that would let themselves, their partner, or employer receive remuneration from the debtor’s estate, except that special proxies may be used to vote for appointing oneself as trustee.
12.–(l) A person acting either under a general or special proxy shall not vote in favour of any resolution which would directly or indirectly place himself, his partner or employer in a position to receive any remuneration out of the estate of the debtor otherwise than as a creditor rateably with the other creditors of the debtor: Provided that, where a person holds special proxies to vote for the appointment of himself as trustee, he may use the said proxies and vote accordingly. (2) The vote of the trustee, or his partner, clerk, advocate, or advocate’s clerk, either as creditor, or as proxy for a creditor shall not be reckoned in the majority required for passing any resolution affecting the remuneration or conduct of the trustee. 503 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Proof of debts in ordinary cases SECOND SCHEDULE (Made under section 37) PROOF OF DEBTS (a) Proof in Ordinary Cases - 1 Verify source ↗
Short title
AI-assisted research summary: A creditor must prove a debt after a receiving order is made, using an affidavit and supporting account details, and usually pays the proving costs.
1.–(1) A creditor shall prove his debt as soon as may be after the making of a receiving order. (2) A debt may be proved by delivering or sending through the post in a prepaid letter to the official receiver, or, where a trustee has been appointed, to the trustee, an affidavit verifying the debt. (3) The affidavit may be made by the creditor himself, or by some person authorised by or on behalf of the creditor, and if made by a per- son authorized, it shall state his authority and means of knowledge. (4) The affidavit shall contain or refer to a statement of account showing the particulars of the debt, and specify the vouchers, where any, by which the same can be substantiated, and the official receiver or trustee may at any time call for the production of the vouchers. (5) The affidavit shall state whether the creditor is or is not a secured creditor, and where it is found at any time that the affidavit made by or on behalf of a secured creditor has omitted to state that, he is a se- cured creditor, the secured creditor shall surrender his security to the official receiver or trustee for the general benefit of the creditors unless the court on application is satisfied that, the omission has arisen from inadvertence, and in that case the court may allow the affidavit to be amended upon the terms as to the repayment of any dividends or oth- erwise as the court may consider to be just. (6) A creditor shall bear the cost of proving his debt, unless, the court otherwise specially orders. Inspection of proof by creditors - 2 Verify source ↗
Interpretation
AI-assisted research summary: A creditor who has lodged a proof may inspect other creditors’ proofs before the first meeting and at reasonable times.
2. A creditor who has lodged a proof shall be entitled to see and examine the proofs of other creditors before the first meeting and at reasonable times. Deduction of trade discounts - 3 Verify source ↗
Acts of bankruptcy
AI-assisted research summary: A creditor proving a debt must deduct trade discounts, but does not have to deduct a cash-payment discount of up to five per cent on the net claim amount if that discount was agreed.
3. A creditor proving his debt shall deduct therefrom trade discounts, but he shall not be compelled to deduct any discount, not exceeding five per centum on the net amount of his claim, which he may have agreed to allow for payment in cash. (b) Proof by Secured Creditors Proof by secured creditors - 4 Verify source ↗
Bankruptcy notice
AI-assisted research summary: A secured creditor may prove only for the balance due after selling security, or for the whole debt if the security is surrendered for the benefit of creditors.
4.–(1) Where a secured creditor realises his security, he may prove for the balance due to him, after deducing the net amount realised. 504 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Assessment of security Redemption of security Amendment of assessment (2) Where a secured creditor surrenders his security to the official receiver or trustee for the general benefit of the creditors, he may prove for his whole debt. - 5 Verify source ↗
Jurisdiction to make receiving order
AI-assisted research summary: A secured creditor who has not realised or surrendered security must state the details, date, and assessed value of the security in the proof before ranking for dividend.
5. Where a secured creditor does not either realise or surrender his security, he shall, before ranking for dividend, state in his proof the particulars of his security, the date when it was given, and the value at which he assesses it, and shall be entitled to receive a dividend only in respect of the balance due to him after deducting the value so assessed. - 6 Verify source ↗
Conditions on which creditor may petition
AI-assisted research summary: The trustee may redeem a valued security by paying the creditor its assessed value, and may require the property to be sold if dissatisfied with the assessed value.
6.–(1) Where a security is valued, the trustee may at any time redeem it on payment to the creditor of the assessed value. (2) Where the trustee is dissatisfied with the value at which a se- curity is assessed, he may require that, the property comprised in any security valued be offered for sale at the times and on the terms and conditions as may be agreed on between the creditor and the trustee, or as, in default of the agreement, the court may direct, and where the sale be by public auction, the creditor, or the trustee on behalf of the estate may bid or purchase: Provided that, the creditor may at any time, by notice in writing, require the trustee to trustee whether he will or will not exercise his power of redeeming the security or requiring it to be realised, and where the trustee does not within six months after receiving the notice, signify in writing to the creditor his election to exercise the power, he shall not be entitled to exercise it; and the equity of redemption, or any other interest in the property comprised in the security which is vested in the trustee, shall vest in the creditor and the amount of his debt shall be reduced by the amount at which the security has been valued. - 7 Verify source ↗
Proceedings and order on creditor’s petition
AI-assisted research summary: A creditor may amend a security valuation, but may have to repay excess dividends and follow any court-ordered terms.
7.–(1) Where a creditor has valued his security, he may at any time amend the valuation and proof on showing to the satisfaction of the trustee, or the court that, the valuation and proof were made bona fide on a mistaken estimate or the security has diminished or increased in value since its previous valuation; but the amendment shall be made at the cost of the creditor, and upon the terms as the court shall order, unless the trustee allow the amendment without application to the court. (2) Where a valuation has been amended in accordance with the foregoing rule, the creditor shall forthwith repay any surplus dividend which he may have received in excess of that to which he would have been entitled on the amended valuation, or, as the case may be, shall be entitled to be paid out of any money, for the time being available for dividend, any dividend or share of dividend, which he may have failed to receive by reason of the inaccuracy of the original valuation, before that money is made applicable to the payment of any future dividend, 505 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] but shall not be entitled to disturb the distribution of any dividend de- clared before the date of the amendment. (3) Where a creditor after having valued his security subsequently realises it, or where it is realised under the provisions of rule 6, the net amount realised shall be substituted for the amount of any valuation previously made by the creditor and treated as an amended valuation made by the creditor. (4) Where a secured creditor does not comply with the foregoing rules he shall be excluded from share in any dividend. (5) Subject to the provisions of rule 6, a creditor shall in no case re- ceive more than twenty shillings in the pound and interest as provided by this Act. (c) Proof in Respect of Distinct Contracts - 8 Verify source ↗
Debtor’s petition and order thereon
AI-assisted research summary: The text refers to how a debtor’s liability under distinct contracts is treated where the debtor is linked to multiple firms, a sole contract, or both, and it mentions periodical payments such as rent.
8. Where a debtor was, at the date of the receiving order, liable in respect of distinct contracts as a member of two or more distinct firms, or as a sole contractor, and also as a member of a firm, the circumstances that, the firms are in whole or in part composed of the same individuals, or that the sole contract or is also one against the properties respectively liable to the contracts. (d) Periodical Payments Proof in respect distinct contracts Rent and other periodical payments - 9 Verify source ↗
Effect of receiving order
AI-assisted research summary: If rent or another payment falls due in stated periods and a receiving order is made between those periods, the entitled persons may prove only for a proportionate part up to the date of the order.
9. When any rent or other payment falls due at stated periods, and the receiving order is made at any time other than one of these periods, the persons entitled to the rent or payment may prove for a proportionate part thereof up to the date of the order as if the rent or payment grew due from day to day. Interest where it is not agreed (e) Interest
Part
part thereof up to the date of the order as if the rent or payment grew
- 10 Verify source ↗
Power to appoint interim receiver
AI-assisted research summary: A creditor may claim interest on certain overdue debts in bankruptcy, up to 6% per year, subject to the listed conditions.
10. On any debt or sum certain payable at a certain time or otherwise, whereon interest is not reserved or agreed for, and which is overdue at the date of the receiving order and provable in bankruptcy, the creditor may prove for interest at a rate not exceeding six per centum per annum to the date of the order from the time when the debt or sum was payable, where the debt or sum is payable by virtue of a written instrument at a certain time, and where payable otherwise, then from the time when a demand in writing has been made giving the debtor notice that interest will be claimed from the date of the demand until the time of payment. (f) Debt Payable at a Future Time Future debts - 11 Verify source ↗
Power to stay pending proceedings
AI-assisted research summary: A creditor may prove a debt that was not payable when the debtor committed an act of bankruptcy, and may share in dividends after deducting a six per cent per annum rebate of interest.
11. A creditor may prove for a debt not payable when the debtor committed an act of bankruptcy as if it were payable presently and may receive dividends equally with the other creditors deducting only 506 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. THE BANKRUPTCY ACT [CAP. 25 R.E. 2023] Admission or rejection of proofs Appeal thereout a rebate of interest at the rate of six per centum per annum computed from the declaration of a dividend to the time when the debt would have become payable, according to the terms on which it was contracted. (g) Admission or Rejection of Proofs - 12 Verify source ↗
Power to appoint special manager
AI-assisted research summary: The trustee must examine a proof of debt, decide in writing whether to admit or reject it (in whole or part), or ask for more evidence.
12.–(1) The trustee shall examine a proof and the grounds of the debt; and in writing admit or reject it, in whole or in part, or require further evidence in support of it, and where he rejects a proof he shall state in writing to the creditor the grounds of the rejection. (2) Where the trustee thinks that, a proof has been improperly admitted, the court may, on the application of the trustee, after no- tice to the creditor who made the proof, expunge the proof or reduce its amount. - 13 Verify source ↗
Advertisement of receiving order
AI-assisted research summary: The court may change or remove a proof on application, and the trustee or official receiver has powers in relation to proofs.
13.–(1) Where a creditor is dissatisfied with the decision of the trustee in respect of a proof, the court may, on the application of the creditor, reverse or vary the decision. (2) The court may also expunge or reduce a proof upon the appli- cation of a creditor where the trustee declines to interfere in the mat- ter, or, in the case of a composition or scheme, upon the application of the debtor. (3) For the purpose of any of his duties in relation to proofs, the trustee may administer oaths and take affidavits. (4) The official receiver before the appointment of a trustee shall have the powers of a trustee with respect to the examination, admis- sion, and rejection of proofs, and any act or decision of his in relation thereto shall be subject to the like appeal. 507 ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG. ©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.
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