Company Law - Icsi

: 3 :264(viii) 'Small shareholder' under company law means a shareholder holding shares of —(a)(b)(c)(d)Nominal value of `20,000 or lessPaid-up value of `20,000 or lessNominal value of `50,000 or lessPaid-up value of `50,000 or less.(1 mark each)(b)Re-write the following sentences after filling-in the blank spaces with appropriateword(s)/figure(s) :(i)(ii)(iii)(iv)(v)(vi)(vii)(viii)Under section 4, if a company holds more than half in ____________ value ofanother company's equity share capital, the relationship of holding company andsubsidiary subsists between the two.____________ is represented by the excess of current assets over currentliabilities.A company desirous of commencing business of banking in India should havean initial minimum paid-up capital of ____________ .As regards companies registered in India, the filing fees payable to the Registrarof Companies varies with ____________ of the company.The relationship of sole selling agent and the appointing company is governed bythe provisions of ____________ .National co-operative societies are multi-State co-operative societies whichhave been listed in the ____________ of the Multi-State Co-operative SocietiesAct, 2002.Criminal liability of an auditor may extend to imprisonment for a period of____________ and/or fine at the discretion of the court.Every ____________ shall be liable to all penalties imposed on the limitedliability partnership for any contravention of the provisions of the LimitedLiability Partnership Act, 2008.(1 mark each)2/2012/CLP.T.O.264/2

264: 4 :3. (a) A person other than retiring director is also eligible for appointment as director. Examine.(b)(c)(d)(4 marks)As Frasile Ltd. was not functioning since 2004, its Board of directors decided not toprepare annual accounts from 2008 and also did not call the annual general meetings.Discuss the validity of the action of the Board of directors.(4 marks)An auditor of a company signed the balance sheet, profit and loss account andschedules/notes and furnished the auditors report on the same date on which the reportswere signed by the directors on behalf of the Board. One of the directors raised objectionstating that the audit can not be completed and certified in a day. Do you agree withthe director and if not, why ?State the matters which cannot be decided through resolution by circulation.4. (a) Explain the manner in which calls on shares should be made by a company.(b)(4 marks)(4 marks)(4 marks)Can the Registrar of Companies seize the books and documents of a company ? Explain.(c) What are the benefits of the depository system of stock holding ?(d)(4 marks)(4 marks)Whether equity shares already issued can be converted into redeemable preferenceshares ? Discuss.5. Distinguish between any four of the following :(i) 'Postponement of meeting' and 'adjournment of meeting'.(ii)(iii)(4 marks)'Beneficial owners under depository mode' and 'registered owners under depository mode'.'Letter of allotment' and 'letter of renunciation'.(iv) 'Brokerage' and 'underwriting commission'.(v)'Reserve capital' and 'capital reserve'.(4 marks each)2/2012/CL Contd ........

: 5 :2646. (a) State, with reasons in brief, whether the following statements are true or false :(i)Outsiders are bound to know the constitution of the company and not the indoormanagement.(ii) As per the guidelines of SEBI, under the Employee Stock Option Scheme, 1999,an 'employee' means any employee whether permanent, temporary, regular orcasual.(iii)(iv)(v)(vi)(vii)(viii)Date of prospectus, unless the contrary is proved, shall be taken as the date ofpublication of the prospectus.Shares issued to the employees under Employee Stock Purchase Scheme (ESPS)at the same price as in public issue shall be locked-in for a minimum period ofone year from the date of allotment.Company Secretary of a section 25 company should have membership of theInstitute of Company Secretaries of India.Dividend has to be distributed within 21 days of its declaration undersection 207.Any member of a company has the right to inspect the minutes book of thedirectors' meetings.Winding-up of a company means dissolution of the company.(b) (i) Section 81 ensures pre-emptive rights of shareholders. Discuss.(1 mark each)(4 marks)(ii)Articles of association of a company provide that a director appointed mustobtain qualification shares within a period of 2 months from the date ofappointment failing which it will be regarded as if he has vacated his office.Anurag, not a shareholder, was appointed as director on 1 st April, 2011. Sincehe failed to acquire qualification shares within the period of 2 months' time, theBoard of directors decided to extend the condition by one more month. Comment.(4 marks)2/2012/CLP.T.O.

264: 6 :7. Write notes on any four of the following :(i)(ii)(iii)(iv)(v)Minimum subscription in case of rights issueVoting by show of handsClass meetingsDuty of statutory auditor to report on disqualification of directorsDoctrine of Cypres.(4 marks each)8. (a) Star Gen Ltd. held a meeting of its Board of directors on 31 st October, 2010 at its registeredoffice. Though the company has 12 directors on its Board, only 5 directors were presentat the commencement of the meeting. Thereafter, even while the meeting was in progress,2 more directors left the meeting and the remaining directors carried on the proceedingsof the meeting. Discuss the validity of decisions, if any, taken by the remaining 3 directors.(4 marks)(b)(c)1,000 Shares of Astro Ltd. are registered in the names of three persons P, Q and Rjointly. Interestingly, the articles of the company provide that the survivors shall be theonly person to be recognised by the company as having any title to the shares of thecompany. Unfortunately, P and Q died in an air crash. In these circumstances,R, being the survivor claims to be the full owner of the said 1,000 shares. However,the legal heirs of P and Q are also making counter claims. Who will succeed ? Explain.(4 marks)A, B and C are joint holders of shares in Clearhead Ltd. The joint holders now askthe company for altering or rearranging the serial order of their names in the registerof members of the company. In reply, the company intends to ask the joint holdersto execute a transfer deed for transposition of names in the register of members. Advisethe company on the course of action.(4 marks)2/2012/CL Contd ........

: 7 :264(d)Mohan applied for 4,000 shares in a company but no allotment was made to him.Subsequently, 4,000 shares were transferred to him without his request and his namewas entered in the register of members. Mohan stood by and allowed his name to remainin the register of members. Subsequently, the company went into liquidation and hewas held liable as a contributory. Now, Mohan wants to apply to the court for rectificationof the register of members. Can he do so ? Explain.(4 marks)––––––0––––––2/2012/CLP.T.O.