Category: Companies Act
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Transmission and Nomination of Shares
One of the most important characteristics of a company is that its shares are transferable. Section 44 of the Companies Act, 2013 states that the shares or debentures or other interest of any member in a company shall be movable property, transferable in the manner provided by the articles of the company. Transfer of shares…
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Forfeiture and Surrender of Shares
Once the minimum subscription has been reached, the shares can be allotted. Letters of Allotment are sent to those who have been allotted their shares. This results in a valid contract between the company and the applicant, who will now be a part owner of the company. If any applications were rejected, letters of regret are sent…
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FAQs Companies Act, 2013 (Shares)
a) What is a stock? Stock is an aggregate of fully paid-up shares. Thus, stock is simply a set of shares put together in a bundle. When shares are fully paid-up, they may be converted into stock. b) What is a share? Section 2(84) of the Companies Act 2013, defines “Shares” as, “Share” means a…
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Transfer of Shares Under Companies Act
A company issues shares to each of its members which represent that that they hold such part of company and a person/entity holding such shares are known as shareholders. A share is not a negotiable instrument, but it is a movable property. Section 44 of the Companies Act, 2013 provides that a share or other…
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Share Certificate and its Implications
A share certificate is a certificate issued by the company under its common seal specifying the shares held by any member and the amount paid on each Share. A share certificate is evidence of title of the allottee or transferee to the shares. It is a declaration that the person in whose name the certificate…
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Allotment of Shares
The main reason being raising capital by company to meet its financial requirements may be for starting a venture, repaying debts, expansion and diversification. When an investor buys securities he is enabling the company to carry on its business using those funds. Primarily, issues can be classified as a Public, Rights or preferential issues (also…
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Share of a Company
When a company issue a prospectus inviting the public to subscribe for the shares of a company, it is merely an invitation rather than an offer. An application for shares is an offer by the prospective shareholders to take the shares of the company. Such offers are made on application forms supplied by the company.…
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Kinds of Companies
Law and You > Corporate Laws > Companies Act, 2013 > Kinds of Companies Different types of companies are private company, Public company, Joint company, holding company, subsidiary company, one person company, foreign company, government company, etc. a) Private Company: According to Section 2(20) of the Companies Act, 2013, a “Company means a company incorporated under this…
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Section 8 Companies or Non-Profit Organizations
The concept of Section 8 companies was introduced in Companies Act 2013 that permitted companies with charitable objects etc. to be registered without the words ‘Limited’ or ‘Private Limited’. The restriction was that the Companies were permitted to use the profits only for the purpose for which the company was promoted and there was a…
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Government Companies
According to Section 2(45) of the Indian Companies Act, 2013, Government company means any company in which not less than fifty-one per cent. of the paid-up share capital is held by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments…