s 706 Treatment of shares purchased
Where a limited company makes a purchase of its own shares in accordance with this Chapter, then— (a) if section 724 (treasury shares) applies, the shares may be held and dealt with in accordance with Chapter 6; (b) if that section does not apply— (i) the shares are treated as cancelled, and (ii) the amount of the company's issued share capital is diminished accordingly by the nominal value of the shares cancelled.