—(1) Where the applicant for a bankruptcy order is a secured creditor of the debtor, he shall in his application —
state that he is willing, in the event of a bankruptcy order being made, to give up his security for the benefit of the other creditors of the bankrupt; or
give an estimate of the value of his security, in which case he may to the extent of the balance of the debt due to him, after deducting the value so estimated, be admitted as a creditor in the same manner as if he were an unsecured creditor.
(2) Where an applicant for a bankruptcy order who is a secured creditor of the debtor fails to disclose his security in the application, he shall be deemed to have given up his security for the benefit of the other creditors of the debtor and upon the making of a bankruptcy order —
he shall not be entitled to enforce his security against the estate of the bankrupt or to retain any proceeds from the realisation of such security; and
he shall execute such document of release as is required by the Official Assignee or account and pay over to the Official Assignee all proceeds from any realisation of his security.
(3) Where any secured creditor fails to execute any document of release as is required by the Official Assignee under subsection (2)(b), the Official Assignee may execute the document on his behalf and the execution of the document by the Official Assignee shall have the same effect as the execution thereof by the secured creditor.
(4) Any secured creditor who fails to account or pay over to the Official Assignee the proceeds from any realisation of his security under subsection (2)(b) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $15,000 or to imprisonment for a term not exceeding 3 years or to both.
(5) Any fine imposed under subsection (4) shall be deemed part of the property of the bankrupt and shall vest in the Official Assignee for the purposes of this Act.