Law Ethics And Communication

The Share Premium account is a reserve created when a company issues shares at a premium, which is the amount received above the face value of the shares. This reserve cannot be utilized for writing off depreciation because depreciation is a non-cash expense that represents the decrease in value of an asset over time. It is not directly related to the issuance of shares or the premium received. Therefore, the Share Premium account cannot be used to cover depreciation expenses.

In order to issue Sweat Equity Shares, a company has to pass a Special Resolution. A Special Resolution is a resolution passed by the members of a company which requires a higher majority of votes (usually 75% or more) in favor of the resolution. This is a requirement under the Companies Act, and it ensures that the issuance of Sweat Equity Shares is approved by a significant majority of the shareholders, providing a higher level of protection for the interests of the company and its existing shareholders. A Board Resolution, on the other hand, is a resolution passed by the board of directors and is not sufficient for issuing Sweat Equity Shares.

Merchantable Quality of goods means that the goods are free from latent defects, meaning there are no hidden or undisclosed flaws or faults. Additionally, the goods are marketable at their full value, indicating that they are in a condition suitable for sale and can be sold at their intended price. Lastly, the goods can be used for the purpose for which they are purchased, ensuring that they meet the buyer's expectations and serve their intended function. Therefore, the correct answer is "All of the above."

The central government can give directions to a company to rectify its name because it has the authority to regulate and govern businesses in the country. If a company's name is found to be misleading or in violation of any laws or regulations, the central government can intervene and instruct the company to make the necessary changes to comply with the rules.

A company shall pass a Special Resolution to issue Global Depository Receipts. This is because issuing Global Depository Receipts involves significant changes or decisions that affect the company's structure or operations. A Special Resolution requires a higher majority of votes from the shareholders, typically at least 75% or more, indicating that a significant majority of shareholders are in favor of the decision. This ensures that major decisions like issuing Global Depository Receipts are made with the consent and agreement of a significant majority of the shareholders.

The statement "All of the above" is the correct answer because it encompasses all the given options. It states that a proxy shall not have the right to speak at the meeting, a proxy cannot vote on show of hands, and a proxy is not counted for a quorum. Therefore, all the statements mentioned are true in relation to a proxy.

The correct answer is Single Strand Chain. In this type of Grapevine transmission, communication is passed on a one-on-one basis. It starts with one person (A) sharing something with another person (B), who then passes it on to another person (C), and so on. This creates a linear chain of communication, where information is transmitted from one person to the next in a sequential manner.

The given options are all types of clauses that can be included in a memorandum. A Liability Clause specifies the extent of liability of the parties involved, a Name Clause states the name of the company, and a Situation Clause describes the registered address of the company. However, a Remuneration Clause is not typically found in a memorandum as it pertains to the payment or compensation of employees or directors, which is usually addressed in other documents such as employment contracts or board resolutions.

The buy-back of equity shares in any financial year is restricted to a certain percentage of the aggregate paid-up capital and free reserves of the company. In this case, the correct answer is 25%. This means that a company can only buy back up to 25% of its total paid-up capital and free reserves in a financial year. This restriction is in place to ensure that companies maintain a certain level of capital and reserves for financial stability and to protect the interests of shareholders.

Under normal circumstances, an AGM (Annual General Meeting) cannot be held on a national holiday. National holidays are typically non-working days and are meant for public observance and celebration. Holding an AGM on a national holiday would likely result in low attendance and inconvenience for the participants. Therefore, it is not feasible to hold an AGM on a national holiday.

Shifting the registered office of a company is treated as a special business at a general meeting. This is because it involves a significant change in the company's operations and requires the approval of the shareholders. The decision to shift the registered office may have implications on the company's legal jurisdiction, tax obligations, and accessibility for stakeholders. Therefore, it is considered a special business that requires careful consideration and approval from the shareholders.

In this question, the correct answer is "All of the above." This means that all the mentioned cases, including being an apprentice, being dismissed for misconduct, and working for less than 30 days in a year, result in an employee not being entitled to a bonus.

According to the given information, an employee is eligible for gratuity if they have worked in an establishment for a continuous period of 5 years. This means that an employee must have completed a minimum of 5 years of continuous service in the same establishment to be eligible for gratuity.

All of the options mentioned in the question are considered as deposits accepted by a company. Amounts received from other companies and any amount received from the director of the company are both considered as deposits. Therefore, the correct answer is "All of the above."

After a buy-back, a company's aggregate debts should not exceed twice the amount of its Capital and Free Reserves. This means that the company should not have a debt that is more than double the combined value of its Capital and Free Reserves. This limit ensures that the company maintains a reasonable level of debt in relation to its financial resources, reducing the risk of insolvency and financial instability.

Preference shareholders typically do not have the right to vote at a general meeting. However, they do have the right to vote on resolutions that directly impact the rights attached to their preference shares. This means that if there is a resolution that could potentially affect their preferential rights, they have the ability to vote on it. Additionally, preference shareholders also have the right to vote on any resolution for the winding up of the company. Therefore, the correct answer is "Yes, only on resolutions which directly affect the rights attached to his preference shares and, any resolution for the winding up."

Ignorance of law is no excuse means that not knowing the law does not exempt someone from legal consequences. In legal systems, it is generally assumed that individuals are aware of the laws and are expected to abide by them, regardless of their knowledge or understanding. This principle ensures that people cannot claim innocence or escape liability simply because they were unaware of a particular law or regulation. It places the responsibility on individuals to educate themselves about the laws that govern their actions and behavior.

A minor is a person who is under the legal age of adulthood. Generally, minors are not considered to have the legal capacity to enter into contracts or engage in certain financial transactions. However, there is an exception when it comes to negotiable instruments. A minor can draw, endorse, and deliver a negotiable instrument such as a check or promissory note, and it will be binding on all parties except the minor themselves. This means that the minor can hold others accountable for their obligations under the instrument, but they cannot be held personally liable for any obligations they undertake. Therefore, the answer is true.

The Board of Directors is empowered to make a call on shares. This means that they have the authority to determine when and how much money shareholders must pay for their shares. The Board of Directors is responsible for making important decisions regarding the company, including financial matters such as issuing calls on shares. They have the power to set the terms and conditions for shareholders to contribute additional funds to the company by making a call on shares.

All of the above are empowered to make entries in the Register of Charges. The Register of Charges is a document that records the details of any charges or mortgages created by a company on its assets. Directors, the Secretary, and persons authorized by the Board of Directors have the authority to create and register these charges. Therefore, all of these individuals can make entries in the Register of Charges.

The correct answer is "Its Registered Office or any other place within the same city." According to the Companies Act, an Annual General Meeting (AGM) of a company can be held at the company's registered office or any other place within the same city where the registered office is located. This allows for flexibility in choosing a suitable venue for the AGM while ensuring that it is still within the jurisdiction of the registered office.

If in a contract both legal and illegal parts exist, and the legal part is separable from the illegal part, then the legal part is considered valid. This means that even though there may be illegal elements within the contract, the legal portion can still be enforced and upheld by the court. The illegal part of the contract, however, would be unenforceable.

A private company can have a subsidiary company, which means it can own and control another company. This is not a restriction associated with a private company. The other options mentioned, such as transfer of shares, invitation to the public, and limiting the number of members to 200, are all restrictions that are typically associated with private companies.

The term "Wages" under the Gratuity Act includes Dearness Allowance but excludes Bonus, Food allowance, and House Rent Allowance. This means that while Dearness Allowance is considered as part of the employee's wages for the calculation of gratuity, the other allowances mentioned are not included. Therefore, the correct answer is "All of the above" because none of the mentioned allowances are included in the definition of wages under the Gratuity Act.

Sweat equity shares are issued by a company to its directors or employees at a discount or for consideration in exchange for their know-how or expertise. This means that the recipients of these shares are contributing their skills, effort, or "sweat" to the company, rather than providing financial capital. Sweat equity shares are a way for companies to reward and incentivize their employees or directors by giving them a stake in the company's ownership and future success.

A valid notice of a general meeting must be given at least 21 clear days in advance. This means that the notice should be sent 21 full days before the meeting, excluding the day of the notice and the day of the meeting itself. This allows sufficient time for all participants to be notified and make necessary arrangements to attend the meeting.

When a person receives money or goods under coercion, they are not entitled to keep them. They are obligated to either repay the money or return the goods to the rightful owner. This is because the transaction was not voluntary and therefore not legally binding. The person who received the money or goods cannot benefit from the coercion and must rectify the situation by returning what was taken from them.

According to SEBI guidelines, every public company in India should be a listed company. This means that the company's shares should be listed on a recognized stock exchange, allowing the public to buy and sell them. Being listed provides transparency and accountability to shareholders and investors, as the company is required to disclose information and comply with various regulations. Therefore, the statement "True" is the correct answer as per SEBI guidelines.

The details of company bankers need not be stated in a prospectus. While the names and addresses of directors, the dates of opening and closing of the subscription list, and the address of the company's registered office are important information that should be included in a prospectus, the details of company bankers are not typically necessary for potential investors to make an informed decision about investing in the company.

A special resolution is required to buy back 18% of capital and free reserves. A buy-back of shares is a significant decision for a company, as it involves reducing the company's share capital. Special resolutions require a higher majority of votes (usually 75% or more) from shareholders to pass, indicating that this decision requires a higher level of approval and consensus among shareholders. Therefore, a special resolution is necessary for this buy-back transaction.

A company cannot utilize its securities premium towards writing off unabsorbed loss. This is because the securities premium is a reserve created from the issue of shares at a premium, and it cannot be used for any purpose other than those specified by law. Writing off unabsorbed loss is a separate accounting treatment that requires the use of other reserves or accumulated profits. Therefore, the securities premium cannot be used for this purpose.

Voting through postal ballot is made mandatory for all of the above options, which include alteration of objects clause, change in place of registered office, and buy-back of shares. This means that for any of these actions to be approved, shareholders must cast their votes through postal ballot.

When necessaries are supplied to a minor, the person or entity that provided the necessaries can recover the amount owed from the minor's estate. This means that if the minor has any assets or property, the person or entity can seek payment from those assets to cover the cost of the necessaries. The minor personally may not be held liable for the debt, as they are considered legally incapable of entering into binding contracts. The minor's guardian may also not be held liable, as their role is to protect the minor's interests rather than assume financial responsibility.

Pre-Incorporation Contracts refer to the contracts that are made on behalf of a prospective company before it is officially formed or incorporated. These contracts are entered into by agents or trustees who act as representatives of the future company. These agreements are binding on the company once it comes into existence. They are essential for carrying out necessary activities such as securing financing, acquiring assets, or establishing business relationships before the company is formally established.

A company can accept calls in advance from its shareholders, but only if it is authorized by its Articles of Association (AOA). The AOA is a legal document that outlines the rules and regulations governing the company, including its financial operations. If the AOA allows for the acceptance of calls in advance, then the company can do so. However, if the AOA does not authorize this, then the company cannot accept calls in advance from its shareholders.

A company can forfeit shares of its member if it is authorized by the Articles of Association. The Articles of Association outline the rules and regulations of the company, including the procedures for forfeiting shares. Without the authorization from the Articles of Association, a company cannot forfeit shares of its members. Therefore, the correct answer is "Yes, only if authorized by Articles of Association."

Shareholders holding at least 1/10th of the capital have the right to call for an Extra Ordinary General Meeting. This means that if shareholders collectively own at least 1/10th of the company's capital, they can request a meeting to discuss important matters that require immediate attention. This provision ensures that shareholders have a voice in the decision-making process and can address any urgent issues that may arise.

Shifting the registered office within the same city does not require alteration of the Memorandum of Association (MOA) because it does not involve any fundamental changes to the company's structure, objectives, or capital. It is simply a change in the physical location of the registered office within the same jurisdiction. Altering the MOA is typically required when there are changes to the company's objects, name, or capital, as these modifications impact the core aspects of the company's operations and legal identity.

According to the Companies Act, 2013, a person can only incorporate one One Person Company (OPC). The concept of OPC is designed for individuals who want to start a company on their own without the need for any partners. Therefore, the correct answer is "No" as a person cannot incorporate more than one OPC.

The default mode of voting in an annual general meeting is a show of hands. This means that participants physically raise their hands to indicate their vote. It is a simple and straightforward method that allows for quick and visible vote counting. However, in certain situations where a more accurate and confidential voting process is required, alternative methods such as a poll, postal ballot, or electronic voting may be used.

Every employee is entitled to a bonus as long as their salary does not exceed Rs.10,000 per month. This means that if an employee's salary is equal to or less than Rs.10,000 per month, they are eligible to receive a bonus. However, if their salary exceeds Rs.10,000 per month, they are not entitled to a bonus.

Yes, a shareholder can mortgage their shares and take a loan from the company, but only if it is approved by the Articles of Association (AOA). The AOA is a document that outlines the rules and regulations governing the company, including any provisions related to shareholders' rights and borrowing against shares. Therefore, without the approval of the AOA, it would not be possible for a shareholder to mortgage their shares and take a loan from the company.

A minor can become a shareholder in a company by acquiring fully paid up shares and having a beneficial interest in the company. This means that the minor must have purchased the shares with their own funds and must have a stake in the company's profits and assets. However, it is important to note that the minor's rights and responsibilities as a shareholder may be limited and subject to legal restrictions.

A shelf prospectus is a type of prospectus that allows a company to offer and sell securities over a period of time, usually up to one year. During this validity period, the company can issue securities multiple times without having to file a new prospectus each time. This flexibility allows the company to respond quickly to market conditions and raise capital more efficiently. Therefore, the correct answer is 1 Year.

There is no specific limit on the maximum rate at which a company can issue shares at a premium. The company has the flexibility to determine the premium based on various factors such as market conditions, demand for the shares, and the company's financial performance. The absence of a specific limit allows companies to have more flexibility in setting the premium rate based on their specific circumstances and objectives.

According to the regulations and guidelines set by regulatory authorities, companies are generally not allowed to issue shares at a discount. This is to ensure fair treatment of all shareholders and prevent any potential manipulation or unfair advantage for certain investors. Therefore, the correct answer is "Not allowed to issue shares at discount."

Minutes book shall be prepared within 30 days from the date of conclusion of general meeting. This means that the minutes of the meeting should be recorded and documented within a month after the meeting has taken place. This is important for maintaining accurate records and ensuring that decisions and discussions are properly documented for future reference. Failing to prepare the minutes within this timeframe may result in the loss or inaccuracy of important information discussed during the meeting.

An Associate Company is a company in which another company holds a significant ownership stake, but does not have full control over its operations. In this case, the correct answer is 20%, indicating that a company needs to hold at least 20% of the share capital of another company to be considered an associate. This threshold is important as it signifies a level of influence and control over the associate company's decision-making processes, without having complete control.

Global Depository Receipts (GDRs) are a financial instrument that allows companies to raise investment directly from foreign companies without the need for a public issue of shares. GDRs are issued by a company in one country but traded in another country's stock exchange. They represent ownership in the company's shares and are typically denominated in a foreign currency. GDRs provide an opportunity for companies to access international capital markets and attract foreign investment without going through the time-consuming and costly process of a public share offering.

A debenture is a type of debt instrument that a company issues to raise funds. It is essentially a loan taken by the company from the debenture holders. Debentures do not carry voting rights as they represent a creditor relationship rather than ownership in the company. Shareholders, on the other hand, are the owners of the company and have voting rights. Therefore, a company cannot issue debentures carrying voting rights.

In this case, Mr. Thomos is the payee. The payee is the person or entity to whom the payment is to be made. In the given scenario, Mr. Girish draws the Bill of Exchange and makes it payable after two months to Mr. Thomos. Therefore, Mr. Thomos is the one who will receive the payment mentioned in the Bill of Exchange.

An employee is entitled to a bonus if they have worked in the establishment for a minimum of 30 days in a year. This means that as long as the employee has worked for at least 30 days within the given year, they are eligible to receive a bonus.

The contract is void because the government banned the transaction of the goods that X and Y agreed to supply. This means that the contract is no longer legally enforceable and both parties are released from their obligations under the contract.

A blank transfer is an instrument of transfer signed by the transferor without filling in the name of the transferee and the date of the transfer. This allows the transferor to leave these details blank and fill them in at a later time when they decide to transfer the instrument to a specific transferee. This type of transfer provides flexibility and convenience for the transferor, as they can easily transfer ownership without having to immediately specify the details of the transferee and transfer date.

The required quorum for a meeting refers to the minimum number of members that must be present in order for the meeting to be valid and decisions to be made. In this case, the correct answer is 5 members personally present. This means that out of the more than four hundred members in the company, at least 5 members must be physically present for the meeting to proceed.

According to the given answer, members holding at least 1/10th voting power can demand for a Poll. This means that a relatively smaller proportion of members, compared to the other options, have the authority to request a Poll.

Gratuity is a sum of money that an employer pays to an employee as a token of appreciation for their long-term service. According to the given answer, the employer is required to pay gratuity within 30 days from the date it becomes payable. This means that once an employee becomes eligible for gratuity, the employer has a maximum of 30 days to make the payment. This ensures that employees receive their gratuity in a timely manner and can use it for their financial needs.

In order to be defined as a Small Company, its paid-up share capital shall not exceed Fifty Lakh rupees. This means that if a company's paid-up share capital is greater than Fifty Lakh rupees, it cannot be classified as a Small Company.

A subsidiary company is a company that is owned or controlled by another company, known as the holding company. The purpose of a subsidiary is to operate under the control and direction of the holding company. Therefore, it would not make sense for a subsidiary company to hold shares in its own holding company, as it would create a conflict of interest and disrupt the hierarchical structure. Hence, the statement "A Subsidiary company cannot hold shares in its Holding Company" is true.

If a company fails to hold its Annual General Meeting (AGM) within the stipulated time, the Registrar of Companies (ROC) has the power to grant an extension for a period which cannot exceed 3 months. This means that if the company is unable to hold its AGM within the prescribed timeframe, it can request an extension of up to 3 months from the ROC. This allows the company additional time to organize and conduct the AGM, ensuring compliance with legal requirements.

If the Board of Directors fails to call for an Extraordinary General Meeting (EGM), the members have the right to call for an EGM themselves. According to the given options, they can do so within 3 months. This means that if the Board of Directors does not take the initiative to call for an EGM within this time frame, the members can exercise their right and arrange for the meeting themselves.

The correct answer is "Cooling period". When a company completes a buy-back of shares, it is not allowed to make any further issue of the same class of shares for the next six months. This period is commonly referred to as the cooling period. During this time, the company is expected to pause and allow the market to stabilize after the buy-back activity. This restriction helps prevent any potential manipulation or unfair practices in the market.

The first AGM (Annual General Meeting) of a company should be held within 9 months from the close of the financial year. This is a legal requirement for companies to ensure that shareholders have the opportunity to review and discuss the company's financial statements and other important matters. Holding the AGM within this timeframe allows for timely reporting and transparency in the company's operations.

In this case, Suresh is the payer. The bill of exchange drawn by Rahul is payable after three months to Micheal, which means Suresh is the one who is obligated to make the payment to Micheal after the specified time period. Therefore, Suresh is the payer in this scenario.

Food Allowance forms part of the salary for computing bonus payable to an employee. Bonus is typically calculated based on the salary of an employee, which includes various components such as basic salary, allowances, and other benefits. Food Allowance is one such component that is included in the salary for bonus calculation purposes.

The State Bank of India is not considered a Public Financial Institution under the Companies Act, 2013. This is because the State Bank of India is a statutory corporation established under the State Bank of India Act, 1955, and not under the Companies Act. Public Financial Institutions under the Companies Act include entities like Life Insurance Corporation of India, Infrastructure Development Finance Company, and companies referred to in the UTI Act.

When the consent of a party is not free, it means that the party did not willingly and voluntarily agree to the terms of the contract. This could happen due to coercion, fraud, undue influence, or misrepresentation. In such cases, the contract is considered voidable, which means that the aggrieved party has the option to either affirm the contract or rescind it. The party whose consent was not free can choose to void the contract and be relieved of any obligations under it.

An offer does not need to contain a term, the non-compliance of which would amount to acceptance. This means that the offeror does not need to include a specific condition or requirement that the offeree must meet in order to accept the offer. As long as the other three conditions are met - intending to create legal relations, having certain and unambiguous terms, and being communicated to the person to whom it is made - the offer is considered valid.

If a company fails to allot shares within the prescribed time, they are required to refund the amounts paid by the shareholders. In this case, the refund must include an interest rate. The correct answer is 12% because it is the only option provided that represents an interest rate.

The correct answer is 15 months because according to corporate governance guidelines and regulations, companies are required to hold their Annual General Meetings within a certain time frame. While the exact time frame may vary depending on the jurisdiction, it is generally recommended that the interval between two AGMs should not exceed 15 months. This ensures that shareholders have regular opportunities to review the company's performance, ask questions, and exercise their voting rights. It also promotes transparency and accountability in corporate governance.

A proxy is a person who is authorized to vote on behalf of another person at a meeting. They have the right to speak at the meeting and can vote on a show of hands. They are also counted for a quorum, which is the minimum number of members required to be present at a meeting in order for decisions to be valid. However, a proxy cannot vote on a poll, which is a formal voting process that allows each member to cast their vote individually.

The minimum amount payable by a shareholder on shares subscribed is 5%. This means that when a shareholder subscribes to shares, they are required to pay at least 5% of the total value of the shares they are subscribing to. This minimum payment ensures that shareholders have a financial stake in the company and helps to protect the interests of other shareholders.

SEBI, the Securities and Exchange Board of India, has specified that companies inviting money from a public issue must have a minimum subscription amount of 90%. This means that at least 90% of the total shares offered in the public issue must be subscribed to by the public. This requirement ensures that companies receive a significant amount of funding before they can proceed with their plans and helps protect investors from potential risks associated with under-subscribed issues.

A company can give its general meeting notice through electronic mail. This is because electronic mail is a commonly used and efficient method of communication in today's digital age. It allows for quick dissemination of information to shareholders and ensures that they are notified in a timely manner. Additionally, using electronic mail for general meeting notices can help reduce costs and paper waste associated with traditional mailings. However, it is important to note that certain legal requirements and regulations may need to be met, such as obtaining shareholders' approval or approval from the Registrar of Companies (ROC).

The rate of maximum bonus payable to an employee as per the Bonus Act is 20%. This means that an employee can receive a bonus of up to 20% of their salary, subject to certain conditions and eligibility criteria mentioned in the Bonus Act.

An Ultra Vires transaction refers to a transaction that is beyond the scope of a company's legal powers or authority. In this context, if such a transaction is ratified by the shareholders, it means that they approve and validate the transaction, even though it was initially outside the company's legal authority. Therefore, the statement "An Ultra Vires transaction can be ratified by shareholders" is true.

Section 138 of the Negotiable Instruments Act, 1881, is the correct answer. This section deals with the charging section for the dishonor of a cheque due to insufficiency of funds. It states that if a cheque is presented for payment and it is returned unpaid due to the lack of sufficient funds in the account, the person who issued the cheque can be held liable and may face penalties such as imprisonment or a fine. This section provides a legal recourse for the payee to take action against the issuer of the dishonored cheque.

The rate of Debenture Redemption Reserve to be created by every company issuing debentures is 25%. This means that for every debenture issued, the company must set aside 25% of its value as a reserve to ensure that there are sufficient funds available for the redemption of the debentures at maturity. This reserve acts as a safeguard for debenture holders and helps to protect their investment.

When a company wants to give a shorter notice for a general meeting, it must obtain approval from its shareholders. The majority required for this approval is 95%. This means that at least 95% of the shareholders must agree to the shorter notice in order for it to be approved.

When goods are delivered to the carrier for transmission to the buyer, it is considered as delivery made to the buyer. This means that the buyer takes ownership and responsibility for the goods once they are handed over to the carrier. The buyer becomes liable for any damages or loss that may occur during the transportation process. Therefore, the correct answer is "Buyer".

The correct answer is Quasi Contract. A quasi contract is a legal concept where a court may impose certain obligations on parties even in the absence of a formal contract. In this scenario, since Sachin is a minor and unable to enter into a legally binding contract, the coach, Karthik, may still be entitled to receive some form of compensation for his coaching services through a quasi contract. This is because the coach has provided a valuable service and it would be unjust for him to go uncompensated.

A shelf prospectus is a type of prospectus that allows a company to make multiple public issues and raise funds over a period of time. It provides flexibility to the company as it can issue securities whenever it deems appropriate, without having to go through the lengthy process of preparing a new prospectus each time. This enables the company to react quickly to market conditions and investor demand. Therefore, a shelf prospectus is the correct answer as it aligns with the description provided in the question.

Section 447 of the Indian Penal Code deals with punishment for fraudulently inducing persons to invest money by making false statements in a prospectus. This section specifically addresses the act of misleading individuals through false statements in order to persuade them to invest their money. The punishment for such fraudulent activities is outlined in this section.

The maximum commission payable on the issue of shares is 5%. This means that the company can pay a commission of up to 5% of the total value of the shares issued. This commission is typically paid to brokers or underwriters who help facilitate the sale of the shares. The 5% commission is the highest percentage allowed, meaning that the company cannot pay a commission higher than this amount.

In order to determine the required quorum for a meeting, it is necessary to consider the total number of members in the company. Since the question states that the number of members is more than five thousand, a larger quorum would be needed to ensure representation. Out of the given options, 30 members personally present would be the most appropriate quorum requirement as it allows for a reasonable percentage of the total membership to be present at the meeting.

A Red Herring Prospectus is a prospectus that does not include complete details of the quantum of price of the securities. It is used to gauge investor interest and generate buzz before the final pricing of the securities is determined. This type of prospectus includes all relevant information about the issuing company and the securities being offered, except for the final offer price. The purpose of a Red Herring Prospectus is to provide potential investors with enough information to make an informed decision while keeping the final pricing details confidential until the offering is complete.

In order to determine the required quorum for a meeting, it is necessary to understand the definition of quorum. Quorum refers to the minimum number of members that must be present at a meeting in order for the meeting to be valid and decisions to be made. In this case, the correct answer is 15 members personally present. This means that out of the total 3000 members in the company, at least 15 members need to be physically present at the meeting for it to be considered valid.

The Doctrine of Constructive Notice states that it is the outsider's responsibility to look into a company's documents before entering into any agreement. This principle implies that anyone dealing with a company is deemed to have knowledge of its public documents, such as its memorandum of association and articles of association. Therefore, individuals cannot claim ignorance of these documents and are expected to have knowledge of their contents.

According to the given statement, every annual general meeting shall be called during business hours. The options provided are different time intervals during which the meeting can be called. The correct answer is "9 a.m. and 6 p.m" because it falls within the business hours and is the only option that satisfies the condition mentioned in the statement.

The chairman is authorized to sign the Minutes book in ordinary circumstances. The chairman is the head of the board or committee and has the responsibility to preside over meetings and ensure that the decisions and discussions are accurately recorded in the Minutes book. As the highest-ranking official in the organization or committee, the chairman's signature holds the authority and validity of the minutes. The secretary may assist in preparing the minutes, but the final approval and signature are typically done by the chairman. The board of directors and auditor may have different roles and responsibilities, but they are not specifically authorized to sign the Minutes book.

The correct answer is Rs.1,00,000. In India, the minimum paid-up capital required to incorporate an One Person Company (OPC) is Rs.1,00,000. This means that the company must have at least Rs.1,00,000 worth of shares issued and paid for by the owner. This requirement ensures that the OPC has sufficient capital to operate and meet its financial obligations.

The time limit to receive the minimum subscription amount from a public issue is 30 days. This means that investors have a maximum of 30 days to submit the minimum required amount for the subscription of shares or securities being offered in the public issue. This time limit ensures that the company or entity issuing the securities can efficiently collect the necessary funds from investors within a reasonable timeframe.

After completing a buy-back, a company is required to physically extinguish the shares bought back within a period of 7 days. This means that the company must cancel and eliminate these repurchased shares from its records and no longer consider them as outstanding. This short timeframe ensures that the buy-back process is efficiently concluded and prevents any confusion or potential manipulation of the company's share structure.

When a company has raised money from the public through a prospectus and still has unutilized funds, the Objects Clause can only be changed through a Special Resolution passed through a Postal Ballot. This means that the shareholders of the company must agree to the change in the Objects Clause through a voting process conducted via postal ballot. This method ensures that all shareholders have an opportunity to express their opinion on the proposed change.

A company with a net worth of 100 Crore can accept deposits from persons other than its members. This indicates that the company has a strong financial position and is deemed capable of handling deposits from external sources.

A company shall take voting through postal ballot for shifting its registered office. This is because shifting the registered office is a significant decision that can impact various stakeholders, including shareholders, employees, and creditors. Therefore, it is important to ensure that all shareholders have the opportunity to vote on this matter, even if they are unable to attend a physical meeting. Voting through postal ballot allows for a more inclusive and convenient way for shareholders to participate in the decision-making process.

According to the Gratuity Act, an employee working below a mine is considered to have completed one year of continuous service if they have worked for a minimum of 180 days under the same employer. This means that even if the employee has not worked for a full year, as long as they have worked for at least 180 days, they are eligible for gratuity benefits as per the act.

According to the Gratuity Act, an employee working in an establishment that operates only 5 days a week is considered to have completed 1 year of continuous service if they have worked for a minimum of 190 days under the same employer. This means that even though the employee may not have worked for a full 365 days, they are still eligible for gratuity if they have completed at least 190 days of work.

A Cluster Chain is a type of Grapevine communication where a person selectively sends the communication to specific individuals. This means that the information is not spread to everyone but is instead shared within a specific group or cluster of people. This allows for more targeted and controlled communication, ensuring that only those who need to know receive the information.

The minimum capital required to incorporate a public company is 5 lakh rupees. This means that in order to register a public company, the company must have a minimum paid-up capital of 5 lakh rupees. This requirement ensures that the company has sufficient funds to operate and meet its financial obligations. Having this minimum capital also provides a level of credibility and financial stability to the company, which is important for public investors and stakeholders.

The correct answer is 21 because according to the question, the Board of Directors are required to call an Extraordinary General Meeting (EGM) within a certain number of days from the date of receiving a requisition. Out of the given options, 21 is the only number that fits this requirement.

Gratuity is a form of gift or payment given by an employer to an employee for the services rendered to the establishment. It is usually provided as a lump sum amount and is given in recognition of the employee's long and meritorious service. Unlike provident fund or insurance, gratuity is specifically given as a gesture of appreciation from the employer to the employee. Bonus, on the other hand, is a separate form of payment that is usually based on performance or achievement of certain targets.

Financial assistance given by a company to its employees to buy shares of the company cannot exceed 6 months' salary. This means that the maximum amount of financial assistance that an employee can receive from the company to purchase shares is limited to an amount equivalent to 6 months' worth of their salary. This restriction ensures that the financial assistance provided by the company is within reasonable limits and does not create an undue burden on the company's resources.

A Void Contract is a contract that was initially valid and enforceable, but due to certain circumstances or actions, it becomes unenforceable by law. This means that the contract loses its legal validity and cannot be enforced in a court of law. The reasons for a contract to become void can include illegality, impossibility, or a change in law that renders the contract unenforceable. Therefore, a void contract is one that ceases to be enforceable by law.