Tag: companies act, 2013 - introduction and characteristics

Questions Related to companies act, 2013 - introduction and characteristics

"Body Corporate" or "Corporation" includes a company incorporated outside India but does not include __________

  1. Companies registered under earlier company law before Companies Act, 2013 came into force

  2. A co-operative society registered under any law relating to co-operative societies; and

  3. Any other body corporate which the Central Government may notify

  4. (B) or (C)


Correct Option: D

Section 2(45) of the Companies Act, 2013 defines a "Government company" as any company in which not less than ____ of the paid-up share capital is held by the Central Government, or by any State Government or Governments, or partly by the Central Government or partly by one or more State Governments.

  1. 31%

  2. 41%

  3. 51%

  4. 61%


Correct Option: C

The auditor of Government Company is appointed or reappointed by the -

  1. Controller and Auditor General of India

  2. Comptroller and Auditor General of India

  3. Comptroller and General Auditor General of India

  4. Central and Auditor General of India


Correct Option: B

Statement X: As a corporate person, the company is not entitled to own and hold property in its own name.
Statement Y: Member can claim ownership of any time of the company's assets.
Select the correct the answer from the options given below:

  1. Statement X is correct and Statement Y is correct explanation of Statement X

  2. Statement X is correct but Statement Y is not correct explanation of Statement X

  3. Statement X and Statement Y both are correct

  4. Statement X and Statement Y both are incorrect


Correct Option: D

Which of the following as section permits the registration, under a licence granted by the Central Government, of associations not for profit with limited liability without being required to use the word "Limited" or the words "Private Limited" after their names?

  1. Section 8

  2. Section 25

  3. Section 18

  4. Section 20


Correct Option: A

As per section 2(51) of the Companies Act, 2013, "Key Managerial Personnel", in relation to a company, means -
(i) Chief Executive Officer or the managing director or the manager
(ii) Company Secretary
(iii) General Manager
(iv) Whole Time Director
(v) Chief Legal Officer
(vi) Chief Financial Officer
Select the correct the answer from the options given below:-

  1. (i), (ii), (iv) and (vi)

  2. (i), (iii), (iv), (v) and (vi)

  3. (i), (ii), (v) and (vi)

  4. (i), (iv), (v) and (vi)


Correct Option: A
Explanation:
  • Key managerial personnel are the employees of a company who hold key positions in the company and greater responsibility of overall functioning of the company including the duty to protect the interest of all stakeholders.
  • Under Section 2 (51) of the Companies Act, 2013 inclusively defines key managerial personnel as:
(i) the Chief Executive Officer or the managing director or the manager;
(ii) the company secretary;
(iii) the whole-time director;
(iv) the Chief Financial Officer; and
(v) such other officer as may be prescribed.

Which of the following is advantage incorporation of company?
(A) Capacity to sue
(B) Greater social responsibility
(C) Corporate personality
(D) Detailed winding-up procedure
Select the correct answer from the options given below:

  1. B and D only

  2. A, B and C

  3. C and B only

  4. C and A only


Correct Option: C

On incorporation, a company acquires legal entity with perpetual succession and a __________.

  1. Seal which is optional

  2. Common seal which is compulsory

  3. Rubber stamp which is compulsory

  4. common seal which is optional


Correct Option: D

A whole time KMP which includes Company Secretary shall not hold office in______________.

  1. More than one company except in its subsidiary company at the same time.

  2. More than two companies and its subsidiary company at the same time.

  3. More than one company except in its associate company at the same time.

  4. More than one company except in related company at the same time.


Correct Option: A
Explanation:

Key Managerial Personnel (KMP) are the employees of a company who hold key positions in the company and greater responsibility of overall functioning of the company including the responsibility to protect the interest of the stakeholders. 

According to Section 203(3), a whole time KMP shall not hold office in more than one company except in its subsidiary company at the same time. 

The expression "Secretarial Standards" means -

  1. Secretarial standards issued by the ICSI

  2. Secretarial standards approved by the Central Government.

  3. Both (A) and (B)

  4. Secretarial standards issued by the ICSI whether approved by the Central Government or not.


Correct Option: C
Explanation:

Secretarial Standards are the standards issued by the Institute of Company Secretaries of India constituted under the section 3 of the Company Secretaries Act 1980. Secretarial Standards provide clear view of the laws when the laws are not clear. These are approved by the Central Government. Secretarial Standards provide clarity to the laws which does not imply that these are alternatives to the original law.