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प्रश्न
Study the following case/situation and express your opinion:
A company stated in its prospectus that it has been making profits since the last 5 years. However, Mr. X. an investor found out that two years back the company had not made any profit. The prospectus was filed with the ROC on 1 st Jan 2017 and was issued to the public on 10th Feb 2018.
a) Can Mr. X state that there was a misstatement in the prospectus?
b) If found guilty which two types of liability will the company and its officers face?
c) Can the prospectus be valid for issue to the public on 10th Feb 2018?
उत्तर
(a) Mr. X can state that there was a misstatement in the prospectus.
(b) If found guilty the company and its officers will face civil liability and criminal liability for misstatement in the prospectus.
(c) Prospectus cannot be valid for the issue to the public on 10th February 2018.
APPEARS IN
संबंधित प्रश्न
Select the correct answer from the option given below and rewrite the sentence.
_________ contains rules and regulations for internal management of the company
Select the correct answer from the option given below and rewrite the sentence.
Articles establishes relationship between company and ________.
Select the correct answer from the option given below and rewrite the sentence.
For making multiple issues of shares within a year, a company can prepare a ________ Prospectus.
Write a word or a term or a phrase which can substitute the following statement:
Document which contains, Name Clause, Registered Office Clause, Capital Clause, etc.
Write a word or a term or a phrase which can substitute the following statement:
Document which contains rules and regulations for internal management.
Write a word or a term or a phrase which can substitute the following statement:
Term used for acts beyond the scope of Memorandum of Association.
Write a word or a term or a phrase which can substitute the following statement:
Document which establishes relationship between a company and its members.
Write a word or a term or a phrase which can substitute the following statement:
This prospectus does not contain information about the quantum of shares to be issued or the price at which shares will be issued.
State whether the following statement is True or False:
Memorandum need not have a Liability Clause.
State whether the following statement is True or False:
Memorandum contains rules and regulations for the internal management of a company.
State whether the following statement is True or False:
Only public companies can issue Prospectus.
State whether the following statement is True or False:
Every company has to issue shelf prospectus every time it offers shares to the public.
State whether the following statement is True or False:
Red Herring prospectus does not contain details of the price at which shares will be sold by the company.
Complete the sentence.
The document issued by a company to invite investors to buy its securities is called as _________
Select the correct option from the given options:
| Group A | Group B |
| Liability clause | ___________ |
Explain the following term/concept.
Name clause
Explain the following term/concept.
Liability clauses
Study the following case/situation and express your opinion:
A public limited company has issued all the shares mentioned in its Memorandum as Authorized Capital. Now the Company wants to make a public issue of 10,000 shares at face value of Rs 100 per share, to raise more funds for its expansion activities :
(a) Which clause of Memorandum needs to be altered?
(b) In which meeting the alteration can be approved?
(c) Which document should the company issue to invite the public to buy its shares?
Justify the following statement.
The doctrine of Indoor Management protects outsiders who are unaware of the correctness of internal proceedings of a company.
