CA - INTERMEDIATE
CORPORATE & OTHER LAWS
GROUP I - PAPER 2
MINOR TEST – 1
May 2024
VOL – 22
Date : 05.11.2023
Vidya Sagar Institute
K-50, Bhawna Tower, Income Tax Colony, Tonk Road,
Near Durga Pura, Bus Stand, Jaipur - 302018
Mobile :- 93514-68666 Ph. :- 7821821250, 7821821251, 7821821252,
7821821253, 7821821254. web : [Link]
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CA - INTERMEDIATE
GROUP I – PAPER 2
CORPORATE & OTHER LAWS
Minor Test – 1 (May 2024)
Volume : 22 Date : 05.11.2023
Maximum Marks: 100 Time - 3 Hours
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Part “A” is compulsory
Part “B” Question No. 1 is compulsory.
Attempt any three questions from the rest.
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Part A
Total 30 Marks
Integrated Case Scenario/Multiple Choice Questions
Satguru Investments Ltd was incorporated on 25th April, 2021. The first
Board meeting of company was held on 30th April, 2021, to discuss the
business issues along with the appointment of first auditor of the company.
The Company Secretary put a panel of 5 auditorsbefore the Board, however no
consensus was arrived at, for the appointment of any of the auditor. The time
prescribed under the Companies Act, 2013, for appointment of the first auditor
lapsed and accordingly the company informed its members that first
auditor for the company could not be appointed and called an Extraordinary
General Meeting of the members for making appointment of the first auditor. The
name of Bharat, a practicing CA, was proposed and the same was appointed by
the members.
The first Annual General Meeting of the company was held on 15th December,
2021 in which, Bharat was appointed as an auditor of the company till the
conclusion of the 6th Annual General Meeting.
In the month of January 2022, a news was published in the local newspaper that
Bharat was sentenced for imprisonment of 2 years by a court of law for the
offence of fraud for which he was going to appeal before the higher court against
the decision of the lower court.
The company treated it as a casual vacancy of the auditor and the Board
appointed another auditor named Gaurav, till the conclusion of the next AGM.
The next AGM held on 20th August 2022, however in this AGM no appointment of
auditor was made.
(Q 1 – Q4)
1. The first auditor should be appointed by the Board of Directors within 2
_______ days from the date of registration of the company, failing which the
members of the company shall within ___________ days at __________
appoint such auditor and such auditor shall hold office till the
conclusion ofthe _.
(a) 30 days / 30 days / an EGM / 6th AGM
(b) 30 days / 60 days / an EGM / 6th AGM
(c) 30 days / 90 days / an EGM / First AGM.
(d) 30 days / 90 days / an EGM / 6th AGM
2. In the given case the Board treating it as casual vacancy, appointed Gaurav. 1
Such casual vacancy of auditor should be filled up by the Board of
Directors……..days and Gaurav shall continue as an auditor of the
company till the conclusionof the next AGM.
Page 1 of 12
(a) Within 30 days
(b) Within 45 days
(c) Within 60 days
(d) Within 90 days
3 Gaurav was appointed by the Board as an auditor till the conclusion of the 1
next AGM. However, in the next AGM, no appointment of auditor was made.
Now what shall be the status:
(a) The present auditor Gaurav, shall continue to be the auditor of the
company.
(b) The present auditor Gaurav’s term was only upto the conclusion of the next
AGM so he should vacate the office as an auditor.
(c) The Board can appoint another person as auditor in place of Gaurav,
treating it as casual vacancy.
(d) When no appointment is made by the members in the AGM, an EGM shall
be called upon to make the appointment of auditor within 90 days.
4 If the Board intends to remove Gaurav as an auditor before the expiry of his 1
term, what procedure needs to be followed?
(a) The auditor can be removed before expiry of his term by moving an
ordinary resolution in the shareholder’smeeting.
(b) The auditor can be removed before expiry of his term by moving an
ordinary resolution in the shareholder’s meeting, after obtaining the
previous approval of the Central Govt.
(c) The auditor can be removed before expiry of his term by moving a special
resolution in the shareholder’s meeting.
(d) The auditor can be removed before expiry of his term by moving a special
resolution in the shareholder’s meeting, after obtaining the previous
approval of the Central Government.
5 In Roopali Marketing Company Private Limited (Authorised capital 50,000 1
shares of Rs. 10 each and paid- up share capital of Rs. 4,50,000), 1000 shares
are jointly held by Abeer and Abheek; another 800 shares are jointly held by
Seema and Srividya; and another 1200 are jointly held by Ramesh, Raksha
and Rajneesh. Further, 42,000 shares are held by 193 individual persons in
their individual capacity. Is it possible for the company to induct more
persons?
(a) The company is unable to induct more persons since it already has two
hundred individual members.
(b) The company can induct four more persons as members.
(c) The company can induct another 20 persons (i.e. 10% of two hundred
individual members) after seeking permission from the concerned ROC.
(d) If the company does not want to seek permission of the concerned ROC, it can
induct only 10 more persons (i.e. 5% of two hundred individual members).
6 Prithvi Cements Limited is desirous of issuing debentures carrying voting 1
rights. Which of the following options is best suited in such a situation:
(a) Prithvi Cements Limited can issue debentures carrying voting rights if an
ordinary resolution is passed permitting such issue.
(b) Prithvi Cements Limited can issue debentures carrying voting rights if a
special resolution is passed permitting such issue.
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(c) Prithvi Cements Limited can issue debentures carrying voting rights if it
mortgages land and buildings worth two times the amount of such
debentures.
(d) Prithvi Cements Limited cannot issue debentures carrying voting rights.
Integrated Case Scenario/Multiple Choice Questions (Q7 – Q9)
Madhu Oils and Fats Ltd. is a listed entity. It finalised its annual accounts for the
year ended on 31st March, 2021. The Audit Committee of Board (ACB)
recommended and subsequently the Board approved the same.
Annual General meeting of the shareholders was convened on 25th August, 2021,
in which the annual accounts of the company were presented before the
shareholders. The shareholders have approved dividend @ 10%.
A report of the Board of Directors was attached with the annual accounts of the
company.
During the said meeting, a shareholder pointed out that during the year of 2020-
21 there was a big news in the media and newspaper that a fraud has happened in
the company of an amount of ` 75 lakhs, with the involvement of a senior
management official of the company, who is absconding since the news came into
media. However, there was no mention about the fraud in the Auditor’s Report as
well as no comment in the Board’s Report. The auditor, who was also present in
the General Meeting of the shareholders informed that fraud was detected during
the course of audit but no further action was taken by him (auditor).
7 Going by the facts of the case, by what date should the amount be deposited 1
in a separate account maintained with the scheduled bank for dividend
purposes?
(a) By 30th August 2021
(b) By 1st September 2021
(c) By 7th September 2021
(d) By 24th September 2021
8 With regard to preservation of the books of Madhu Oils and Fats Ltd, the 1
books of accounts for the Financial Year (FY) 2020-21 needs to be kept in
good order until at least which of the following years?
(a) FY 2025-26
(b) FY 2026-27
(c) FY 2027-28
(d) FY 2028-29
9 The auditor had noticed the fraud that was committed by the senior 1
management. Which is the correct statement in this respect:
(a) The auditor shall report the matter to the Central Government immediately.
(b) It is not necessary to disclose the details of fraud in the Board’s Report
(c) The auditor shall report the matter to the audit committee constituted
under section 177 or to the Board.
(d) Since the Senior Management Personnel is absconding, the auditor is not
required to take any action.
10 Which of the following given Statement/s is/are correct: 2
[Link] all Central Acts and Regulations, any words which denote the masculine
gender shall also be taken to include females, and vice versa.
[Link] all Central Acts and Regulations, words in the singular shall include the
plural, but not vice versa.
Page 3 of 12
(a) Only statement (1) is correct.
(b) Only statement (2) is correct.
(c) Both the statements are correct.
(d) None of the statement is correct.
11 “Associate company”, in relation to another company, means a company in 1
which that other company has a significant influence, but which is not a
subsidiary company of the company having such influence and includes a
joint venture company. Here, the words ‘significant influence’ means:
(a) Control of at least 10% of total voting power
(b) Control of at least 15% of total voting power
(c) Control of at least 20% of total voting power
(d) Control of at least 25% of total voting power
12. Which of the following is a prohibited service to be rendered by the auditor 1
of the Company?
(a) Design and implementation of any financial information system
(b) Making report to the members of the company on the accounts examined by
him
(c) Compliance with the auditing standards
(d) Reporting of fraud against the company by officers or employees to the
Central Government
13. Delight Sports Garments Limited is contemplating to raise funds through 1
issue of prospectus in which, according to the directors, a sum of ` 50
crores should be stated as the minimum amount that needs to be
subscribed by the prospective subscribers. The funds shall be raised in
four instalments consisting of application, allotment, first call and second &
final call. Advise the company by which instalment it should receive the
minimum subscription stated in the prospectus.
(a) Along with amount subscribed as application money.
(b) Along with amount subscribed as final call money.
(c) Along with amount subscribed as first call money.
(d) Along with amount subscribed as second and final call money.
14. Today, it’s May 2023. Mr. Nilanjan Chattopadhyay a 24 years old Indian 1
youngster, who returned back to India in January month of 2023 after
completing his education in bio-nutrient and willing to form an OPC; but not
sure about the requirements or pre-conditions regarding eligibility. He read
some articles on provisions related to OPC and concluded;
(i) OPC can be formed by Indian Citizen only
(ii) He can’t form OPC because in immediate previous year he was not
resident in India
Choose the correct option:
(a) Both the conclusions are valid
(b) None of the conclusion is valid
(c) First conclusion is invalid
(d) Second conclusion is invalid
15. ABS Chemicals Limited issue ordinary share of different classes. ABS 2
planned to vary rights of one the class wherein there were only 105 holders.
100 out of 105 holders own 0.5% shares of that class, whereas each of
remaining 5 holders hold 10% shares of that class. Presuming 100 holder
who own 0.5% shares already signed/authorised the consent letter
sanctioning the variation, how many holders out of such 5 need to authorise
the said letter to approve the variation.
Page 4 of 12
(a) 0
(b) 1
(c) 3
(d) 5
16. In case of an application for reservation of name or for change of its name by 1
an existing company, the Registrar may reserve the name for a period
of……….from the date of approval
(a) 90 days
(b) 60 days
(c) 30 days
(d) 20 days
17. The word ‘firm’ for the purpose of Section 139 shall include- 1
(a) An individual auditor
(b) LLP
(c) An individual auditor and LLP both
(d) A company
18. State the time period for appointment of Cost Auditor by a Company: 1
(a) Within 30 days from the commencement of financial year
(b) Within 60 days from the commencement of financial year
(c) Within 120 days from the commencement of financial year
(d) Within 180 days from the commencement of financial year
19. Angel Infrastructures Pvt. Ltd. with a paid up capital of Rs.45 Lacs and 1
annual turnover of Rs.175 Lacs, is a wholly owned subsidiary of Almighty
Infrastructure Development Ltd. a listed company. Can Angel
Infrastructures be called a small company?
(a) Yes. The paid up capital and annual turnover of Angel Infrastructure Pvt.
Ltd. is not exceeding the limit as specified under the definition of Small
company.
(b) No. Because Angel Infrastructure Pvt. Ltd. is a wholly owned subsidiary
company of a listed pubic company.
(c) No. Because Angel Infrastracture Pvt. Ltd. is not a subsidiary of a listed
company.
(d) No. Because the paid up capital is Rs. 45 lacs less than prescribed limit of
Rs. 4Cr. but its turnover is exceeding Rs.100 Lacs.
20. In case of ‘offer of sale of shares by certain members of the company’, which 1
of the following options is applicable:
(a) The provisions relating to minimum subscription are not applicable
(b) Entire minimum subscription amount is required to be received within
three days of the opening date
(c) 25% of the minimum subscription amount is required to be received on the
opening date and the remaining 75% within three days thereafter
(d) 50% of the minimum subscription is required to be received by the second
day of the opening date and the remaining 50% within next three days after
the second day
21. Imprisonment shall mean imprisonment of either description as defined 1
in…………….?
(a) Indian penal code
(b) Companies Act
(c) Both of them
(d) None of the above
Page 5 of 12
22 The Authorised share capital clause of LMN & Co. ltd. consisted of 1
Preference share capital and Equity share capital both. With regard to
equity share capital, the article of association of the company has given
authorisation to issue differential equity shares. Apart from authorisation
by the Articles, from the following strike out the condition, which is not
mandatory to comply with—
(a) Such issue of shares must be authorised by an ordinary resolution passed at
a general meeting of the shareholders or by postal ballot, as the case may be
(b) The company must have consistent track record of distributable profit for
the last five years.
(c) The company has no subsisting default in the payment of the declared
dividend to its shareholders.
(d) The company has not defaulted in filing financial statements and annual
returns for three financial years immediately preceding the financial year in
which it is decided to issue such shares
23 Modern Books Publishers plc., a company incorporated in United Kingdom 2
(UK) has a wholly owned subsidiary by the name Beta Periodicals Limited
whose Registered Office is situated at Mumbai and which is engaged in
publishing scientific, technical and specialty magazines, periodicals and
journals. Beta Periodicals Limited considers itself to be a foreign company
since it is a wholly owned subsidiary of Modern Books Publishers plc. which
is a foreign company. From the four options given below, you are required
choose the one which appropriately indicates whether Beta Periodicals
Limited can be considered as a foreign company:
(a) Beta Periodicals Limited cannot be considered as a foreign company even if
it is a wholly owned subsidiary of Modern Books Publishers plc. which is a
foreign company.
(b) Beta Periodicals Limited shall be considered as a foreign company since it is
a wholly owned subsidiary of Modern Books Publishers plc. which is a
foreign company.
(c) Beta Periodicals Limited can be granted the status as a foreign company, if
its holding company Modern Books Publishers plc. makes an application to
the Regional Director having jurisdiction over New Delhi for considering its
wholly owned subsidiary Beta Periodicals Limited a foreign company.
(d) Beta Periodicals Limited can be granted the status as a foreign company, if
its holding company Modern Books Publishers plc. makes an application to
the New Delhi Bench of National Company Law Tribunal for considering its
wholly owned subsidiary Beta Periodicals Limited a foreign company.
24. A resolution shall be a special resolution when the votes cast in favour of the 1
resolution by members are not less than the number of votes, if any, cast
against the resolution :
(a) Twice
(b) Three times
(c) Three fourth of
(d) Two third of
25. Mr. A died at the age of 72 leaving behind some movable and immovable 2
properties to be distributed between his two sons C & D, as per his
registered will. His will clearly mentioned that all the immovable property
should go to C and all the movable property should go to D. Both the
brothers divided the property as per will except below mentioned
properties, because they could not establish which property should go to
whom. Kindly help them by ticking the property/ies which should go to D
(as per the provisions of the general Clause Act, 1897):
Page 6 of 12
(a) Standing crop in the fields.
(b) Cut crop, ready to sell.
(c) Tube well in the agriculture land.
(d) Sandal wood tree.
Page 7 of 12
Part-B
Question No. 1 is compulsory.
Attempt any three questions from the rest.
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1A. Virjesh Limited is a company in which Hrishkesh Limited is holding 60% of its paid 4
up share capital. One of the shareholders of Hrishkesh Limited made a charitable
trust and donated his 10% shares in Hrishkesh Limited and ` 50 crores to the trust.
He appoints Virjesh Limited as the trustee. All the assets of the trust are held in the
name of Virjesh Limited. Can a subsidiary company hold shares in its holding
company in this way?
B. FLP Ltd, engaged in the business of real estate and energy, defaulted on its 3
borrowings which amounted to thousands of crore. During the year ended 31st
March 2023, a fraud was uncovered in respect of various transactions of the
company and it was observed by the Central Government that the auditors of the
company were involved in such fraud. Please suggest what can be the course of
action in this case.
C. A company incorporated in France, with limited liability, established an office in 4
Baroda, and started conducting business activity from its place of business. In
compliance of Section 382 of the Companies Act, 2013, it conspicuously exhibited a
name board outside its office, with the name of the company in English in big block
letters.
In three days, the company received a notice from the Registrar stating that it had
not properly complied with the requirements of Section 382 of the Companies Act,
2013.
Mention the areas of lapses of the foreign company, which would be mentioned in
the notice.
D. Yellow and Pink had a long dispute regarding the ownership of a land for which a 3
legal suit was pending in the court. The court fixed the date of hearing on
29.04.2022, which was announced to be a holiday subsequently by the Government.
What will be the computation of time of the hearing in this case under the General
Clauses Act, 1897?
E. Bhuj Cement Limited is engaged in the manufacture of different types of cements 5
and has got a good brand value. Over the years, it has built a good reputation and its
Balance Sheet as at March 31, 2023 showed the following position:
1. Authorized Share Capital (25,00,000 equity shares of ` 10/- each) ` 2,50,00,00
Issued, subscribed and paid-up Share Capital (10,00,000 equity shares of ` 10/-
each, fully paid-up) ` 1,00,00,000
2. Free Reserves ` 3,00,00,000
The Board of Directors are proposing to declare a bonus issue of 1 share for
every 2 shares held by the existing shareholders. The Board wants to know the
conditions and the manner of issuing bonus shares under the provisions of the
Companies Act, 2013.
Page 8 of 12
2A. M/s. Unicorn Rubber Sheets Limited was incorporated and registered in the United 3
Kingdom. M/s Artha Rubber Sheets Manufacturing and Trading Limited is an Indian
Company incorporated and registered under the provisions of the Companies Act,
2013. A scheme of compromise between the above two companies provided for an
amalgamation of the English Company with the Indian company. The CFO of the
Indian Company is of the opinion that the companies being amalgamated must be
companies registered in India and therefore an amalgamation with a company
registered outside India is not possible. Explaining the relevant provisions of the
Companies Act, 2013, examine the correctness or otherwise of the following with
reference to a scheme of amalgamation of Companies whether the contention of the
CFO is correct that the companies being amalgamated must be Companies registered
in India?
B. Examine the validity of the following different decisions/proposals regarding 3
change of office by A Limited under the provisions of the Companies Act, 2013:
(i) The Registered office is shifted from Thane (Local Limit of Thane District) to
Dadar (Local limit of Mumbai District), both places falling within the
jurisdiction of the Registrar of Mumbai, by passing a special resolution but
without obtaining the approval of the Regional Director.
(ii) The registered office situated in certain place of a city is proposed to be shifted
to another place within the local limits of the same city under the authority of
Board Resolution.
C. Mr. Nirmal has transferred 1000 equity shares of Perfect Private Limited to his 4
sister Ms. Mana. The company did not register the transfer of shares and also did not
send a notice of refusal to Mr. Nirmal or Ms. Mana within the prescribed period.
Discuss as per the provisions of the Companies Act, 2013, whether aggrieved party
has any right(s) against the company?
D. Mr. R, an advocate, fraudulently deceived his client Mr. Chandan who was taking his 3
expert advise on taxation matters. Now, Mr. R is liable to a fine for his fraudulent act
both under the Advocates Act and the Income Tax Act, 1961. State the provision as
to whether his offence is punishable under both Acts. Give your answer as per the
provisions of the General Clauses Act, 1897.
E. Phil Heath Systems Incorporated (PHSI), is a foreign Company registered in 4
Australia and has established a place of business in India. The financial statements
pertaining to the Indian business operations for the year ended 31st March, 2020
were prepared by the Company. Referring to the provisions of the Companies Act,
2013, advise the Company on the following matters:
(i) Whether the accounts of the Company pertaining to Indian business
operations shall be audited ? If yes, by whom ?
(ii) What is the due date for filing the audited financial statements with the
Registrar of Companies (RoC) ?
(iii) What is the effect of the contracts entered by an Indian Company with PHSI
in case PHSI has not filed financial statements with the RoC?
(iv) In which e-forrn and within what period, the annual return of the Indian
operations of the foreign company shall be filed with the Registrar of
Companies?
(v)
3A. Prakhar Ltd. intends to raise share capital by issuing Equity Shares in different 4
stages over a certain period of time. However, the company does not wish to issue
prospectus each and every time of issue of shares. Considering the provisions of the
Companies Act, 2013, discuss what formalities Prakhar Ltd. should follow to avoid
repeated issuance of prospectus?
Page 9 of 12
B. K Limited, an unlisted company decided to issue sweat equity shares to its 3
employees for which it has passed the special resolution and completed the other
formalities. Discuss the validity of the following with respect to issue of shares at a
discount as per provisions of the Companies Act, 2013.
(a) Decision to issue the shares to an employee of a subsidiary outside India who joined
six months ago;
(b) Decision to issue shares at a discount to a non-independent part-time director of the
company.
(c)
C. The Articles of Association of Regular Ltd. provides that documents may be served 3
upon the company only through registered post. Ram dispatches a document to the
company by courier service. The company does not accept it on the ground that it is
in violation of the Articles of Association. Examine with reference to the provisions
of the Companies Act, 2013 whether refusal of receipt of document by the company
is valid ?
D. Mr. A (landlord) staying in Delhi, rented his flat of Bengaluru to Mr. B (tenant) for 3
Rs.20,000 per month to be paid annually. An agreement was made between them
that during the tenancy period, if A requires his flat to be vacated, one-month prior
notice is to be given to Mr. B. After eight months a notice was sent by Mr. A to Mr. B
to vacate his flat by registered post which was refused to be accepted by Mrs. C (wife
of Mr. B) and Mr. B denied to vacate the flat on ground of non-receipt of notice.
Examine, as per the General Clauses Act, 1897, whether the notice is tenable?
E. Examine whether the following persons are eligible for being appointed as auditor 4
under the provisions of the Companies Act, 2013:
(i) "Mr. Prakash" is a practicing Chartered Accountant and "Mr. Aakash", who is a
relative of "Mr. Prakash" is holding securities of "ABC Ltd." having face value
of ` 70,000/- (market value ` 1, 10,000/-). Directors of ABC Ltd. want to
appoint Mr. Prakash as an auditor of the company.
(ii) Mr. Ramesh is a practicing Chartered Accountant indebted to MNP Ltd. for
rupees 6 lakh. Directors of MNP Ltd. want to appoint Mr. Ramesh as an auditor
of the company.
(iii) Mrs. KVJ spouse of Mr. Kumar, a Chartered Accountant, is the store keeper of
PRC Ltd. Directors of PRC Ltd. want to appoint Mr. Kumar as an auditor of the
company
4A. Aman an engineer has started a new company with the name of Nuts and Bolts 4
Private Limited. He got registered a company with the same name. However, Nuts
and Bolts is a registered trademark. After 5 years when the owner of trademark
came to know about the same, it filed an application with relevant authority. Can the
company be compelled to change its name by the owner of trademark? Can the
owner of registered trademark request the company and then company change its
name at its discretion?
B. A company has accumulated Free Reserves of Rs.150 lakhs during last five years. It 5
has not declared any dividend during these years. Now, the company proposes to
appropriate a part of this amount for making payment of dividend for current year
in which it has earned a profit of Rs. 12 lakhs. The Board proposes a payment of
dividend of Rs.30 lakhs i.e. 20% on the paid up capital. Examine, as per the
provisions of the Companies Act, 2013, whether, the proposal of the company is
valid?
Page 10 of 12
C. Z Limited, a Foreign Company, incorporated in Japan has a branch office in 5
Hyderabad in India. Mr. Bhartiya, the Indian Citizen holds preference shares of Z
Limited which comprises 10% of the paid-up share capital of the company. Deshi
Limited, a company incorporated in India holds equity shares of Z Limited which
comprises 45% of the paid-up share capital of the company. During the financial
year 2019-20, there has been alteration in the particulars of the documents
mentioned under section 380 of the Act and the company has failed to submit the
alterations to the Registrar within 30 days. Analyse in the light of the applicable laws
the consequences of failure on the validity of any contracts entered into by the
foreign company?
D. Under the provisions of companies Act, 2013 if a person committed fraud in respect 3
of Company then he shall be punishable under section 447 for fraud. Miss Katrina
committed fraud with respect to company. On a prosecution against her in the court,
she challenges that liability of only male person under section 447 because use of
word “He shall be punishable _____________”, represents to a male person. Advice as
per the provision of General clauses Act, 1897, whether contention of Miss Katrina is
tenable?
5A. PQ Ltd. declared and paid 10% dividend to all its shareholders except Mr. Kumar, 3
holding 500 equity shares, who instructed the company to deposit the dividend
amount directly in his bank account. The company accordingly remitted the
dividend, but the bank returned the payment on the ground that the account
number as given by Mr. Kumar doesn't tally with the records of the bank. The
company, however, did not inform Mr. Kumar about this discrepancy. Comment on
this issue with reference to the provisions of the Companies Act, 2013 regarding
failure to distribute dividend.
B. (i) A prospectus issued by a company contained certain mis-statements. On 5
becoming aware of the fact regarding mis-statements in the prospectus, one of
the experts Anilesh who had earlier given his consent, forthwith gave a
reasonable public notice stating that the prospectus was issued without his
knowledge and consent. Is it possible for Anilesh to escape liability for mis-
statement in the prospectus?
(ii) XYZ Limited has not filed annual return and financial statements for the year
ended 31st March, 2019. The company has defaulted in payment of redemption
amount of debentures due in December, 2019 and repayment of matured
deposits and interest due thereon and the defaults are still continuing. XYZ
Limited is proposing to change its name to ABC Limited. Advise the company.
C. Examine the validity of the following statements with reference to the General 3
Clauses Act, 1897:
Board of Directors of Sabarwal Construction Private Limited authorised by passing
resolution in board meeting Mr. Munim to appoint five employees for accounts
department of company. Mr. Munim appointed five employees including Mr. Rupal
who was relative of one of the director of company. After one month, Mr. Munim
observed that Mr. Rupal was not performing his duties honestly. Mr. Munim issued
the order of dismissal of Mr. Rupal with proper reasons. Mr. Rupal filed a petition in
the court that his dismissal order is not valid as Board of Directors had authorised
Mr. Munim only for appointment of employees not for dismissal. Whether is Mr.
Rupal correct with his words?
Page 11 of 12
D. “Moonstar Ltd” is authorised by its articles to accept the whole or any part of the 6
amount of remaining unpaid calls from any member although no part of that amount
has been called up. ‘A’, a shareholder of the Moonstar Ltd., deposits in advance the
remaining amount due on his shares without any calls made by “Moonstar Ltd.”.
Referring to the provisions of the Companies Act, 2013, state the rights and
liabilities of Mr. A, which will arise on the payment of calls made in advance.
Page 12 of 12
