Corporate and Other Laws - January 2021

A Ltd. issued 1,00,000 equity shares of ` 100 each at par to the public by issuing a prospectus. The prospectus discloses the minimum subscription amount of ` 15,00,000 required to be received on application of shares and share application money shall be payable at ` 20 per share. The prospectus further reveals that A Ltd. has applied for listing of shares in 3 recognized stock exchanges of which 1 application has been rejected. The issue was fully subscribed and…

(a) RS Ltd. received share application money of ` 50.00 Lakh on 01.06.2019 but failed to allot shares within the prescribed time limit. The share application money of ` 5.00 Lakh received from Mr. Khanna, a customer of the Company, was refunded by way of book adjustment towards the dues payable by him to the company on 30.07.2019. The Company Secretary of RS Ltd. reported to the Board that the entire amount of ` 50.00 Lakh shall be deemed to…

(a) State the reasons for the issue of shares at premium or discount. Also write in brief the purposes for which the securities premium account can be utilized? (5 Marks) (b) Mr. R, holder of 1000 equity shares of ` 10 each of AB Ltd. approached the Company in the last week of September, 2019 with a claim for the payment of dividend of ` 2000 8 INTERMEDIATE (NEW) EXAMINATION: JANUARY, 2021 declared @ 20% by the Company at its…

(a) CDS Ltd. is planning to make a private placement of securities. The Managing Director arranged to obtain a brief note from some source explaining the salient features of the issue of private placement that the Board of Directors shall keep in mind while approving the proposal on this subject. The brief note includes, inter alia, the information / suggestions on the following points: (i) A private placement shall be made only to a select group of identified persons not…

London Limited, at a general meeting of members of the company, passed an ordinary resolution to buy-back 30 percent of its equity share capital. The articles of the company empower the company for buy-back of shares. Explaining the provisions of the Companies Act, 2013, examine: (A) Whether company's proposal is in order? (B) Would your answer be still the same in case the company instead of 30 percent, decides to buy-back only 20 per cent of its equity share capital?…