Tag: introduction to companies

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Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

"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)
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Under the Companies Act, 2013, the definition of 'Body Corporate' excludes co-operative societies registered under any law relating to co-operative societies and any other body corporate which the Central Government may notify.

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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%
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

As established in Section 2(45), a Government company requires at least 51% of the paid-up share capital to be held by the government.

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The auditor of a Government company is appointed or reappointed by the Comptroller and Auditor General of India (CAG).

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A company is a legal person capable of owning property in its own name, and members have no proprietary interest in the company's assets. Therefore, both statements are incorrect.

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Section 8 of the Companies Act, 2013 allows associations not for profit to be registered without using the words 'Limited' or 'Private Limited' in their names.

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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)
Reveal answer Fill a bubble to check yourself
A Correct answer
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.
Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The advantages of incorporation include corporate personality and the capacity to sue in its own name. 'Greater social responsibility' is not a standard legal advantage of incorporation, and a 'detailed winding-up procedure' is generally considered a disadvantage.

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Under the Companies Act, 2013, the use of a common seal is now optional for a company.

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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.
Reveal answer Fill a bubble to check yourself
A Correct answer
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. 

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

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.
Reveal answer Fill a bubble to check yourself
C Correct answer
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.