CS Professional June 2018
ACLP
Suggested Answers
Paper - 1 : Advanced Company Law and Practice
Chapter - 1 : Company Formation and Conversion
2018 - June [2A] (iii)
KMP Systems Pvt Ltd. will have to abide by the following restrictions as a
private company under the Companies Act 2013.
(a) Financial year of every company including private company has to end
on 31% March every year compulsorily
(b) Private companies whose turnover is 200 crores are now during
preceding financial year or Private company having outstanding loans
are borrowing from banks or public financial institutions exceeding = 100
crores at any time during preceding financial year shall compulsorily
require to appoint an internal auditor
(c) Private company cannot invite public to subscribe to its securities
(d) The transferability of shares of a private company is restricted.
Chapter - 2 : Procedure for Alterations of the Memorandum and Articles
2018 - June [6] (d)
Mr. Sumana
Deputy General Managers (Finance)
Glamour Rise Ltd.
Dear Sir,
Please take note of the items to be mentioned in the annexure attached
to the notice of EGM to be called for the purpose of passing the special
resolution for the shifting of Registered office of the company from one state
to anotherari
Whatsapp Study Group vo a
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Only for Dedicated CS Students iii) Vv '
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1744859960 —(i) Details of the new registered office
(ii) Reasons for bringing about the change
(iii) Effect of such change on secured as well as unsecured creditors
(iv) Effect of such change on employees of the company
(v) Any other information with respect to suchychangewhich=shouldybe
provided to the members.
Chapter - 3 : Issue and Allotment of Securities
2018 - June [2] (b)
As per Section 62 (1) (b) of the Companies Act, 2013 the company can offer
shares through employee stock option to their employees. However issuing
of employee stock to promoters or employees belonging to promoter group
is prohibtied. Further the Companies Act, 2013 as well as SEBI (Listing
Obligations and Disclosure requirements) Regulations 2015 prohibit the
insurance of employee stock options to independent directors.
In the given situation Abhiman is a permanent employee of Y2Z
commodities Ltd. and is also a promoter of the company. Hence Abhiman is
ineligible to obtain employee stock option.
If Abhiman was not a promoter and is a non independent additional
director who holds 10% equity shares of the company, he would be entitled
to participate in employee stock option as his shareholding is net more than
10% of outstanding equity share capital.
2018 - June [2A] (i)
As per Section 2 (88) of the Companies Act, 2013 sweat equity shares”
means such equity shares as are issued by a company to its directors or
employees at a discount for consideration other than cash for providing their
know how an making available rights in the nature intellectual property rights
or value additions.
A company cannot issue sweat equity shares for more than 15% of its paid
up equity share capital in a year on shares of the value of rupees % 5 crores,
Whichever is higher. Further the total amount of sweat equity shares issued
by the company shall not exceed 25% of its paid up equity share capital.
In the case of Jupiter Pvt. Ltd. the paid up equity share capital is = 25
crores.