Allotment of shares

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 May 2010 In case of Private Limited Company,

1) whether the company can allot the shares in the name of Proprietary concern name instead of individual name.

2) whether the company can allot the shares in the name of partnership firm name.

Rasesh

Rasesh (Expert)
Follow

14 May 2010 No. In both cases.

Ankur Garg

Ankur Garg (Expert)
Follow

14 May 2010 Agree with expert as both the proposed allottee above can not become members of the company through allotment of equity shares.

Thanks

Upgrade to CAclubindia Pro. Subscribe Now!

Querist : Anonymous

Querist : Anonymous (Querist)

14 May 2010 If the firm wants invest in a private limited company, how it will be done?

Rasesh

Rasesh (Expert)
Follow

14 May 2010 The shares are to be issued by the private limited company in the names of the proprietor. The balance sheet of the firm may show it as its investments. But ultimately the firm and the proprietor are the same person.

Ankur Garg

Ankur Garg (Expert)
Follow

14 May 2010 A company can take loan from firm. I do not think there is any problem. Wait for other opinions.

Querist : Anonymous

Querist : Anonymous (Querist)

14 May 2010 Sir, my question is if the partnership firm wants invest in the shares of a private limited co, how it will be done?

Jagruti (CS)

Jagruti (CS) (Expert)
Follow

14 May 2010 If partnership firm wants to invest in shares of pvt. co. it can be done in the name of partner on behalf of firm but not in the name of firm.

Upgrade to CAclubindia Pro. Subscribe Now!

Querist : Anonymous

Querist : Anonymous (Querist)

14 May 2010 Thanks to all for the reply.

Sir/madam,

why the company cannot allot the share in the name of the partnership firm. When it can allot in the name of the company and individual, why it cannot allot in the name of the partnership firm. What is the logic behind this.

Rasesh

Rasesh (Expert)
Follow

14 May 2010 Partnership does not have a seperate legal entity.