20 July 2012
As per provision of sec.77 A Buy back of shares limit is 25 %of paid capital + Reserve . whether this limit apply to once in life time of the comapny ? or 25 % per year ?whether company can buy back shares @ 25 % only in once in life time ? or as many time as company wish ?
24 July 2012
A COMPANY MAY PURCHASE ITS OWN SHARES OR OTHER SPECIFIED SECURITIES (HEREINAFTER REFERRED TO AS “BUY-BACK”) OUT OF—
(I) ITS FREE RESERVES; OR
(II) THE SECURITIES PREMIUM ACCOUNT; OR
(III) THE PROCEEDS OF ANY SHARES OR OTHER SPECIFIED SECURITIES:
THE BUY-BACK IS OR LESS THAN 10% OF THE TOTAL PAID-UP EQUITY CAPITAL AND FREE RESERVES OF THE COMPANY; AND SUCH BUY-BACK HAS BEEN AUTHORISED BY THE BOARD BY MEANS OF A RESOLUTION PASSED AT ITS MEETING: AND IF EXCEEDS THE LIMITS OF 10% APPROVAL OF THE SHAREHOLDERS IS NECESSARY
PROVIDED THAT THE BUY-BACK OF EQUITY SHARES IN ANY FINANCIAL YEAR SHALL NOT EXCEED 25% IN THAT FINANCIAL YEAR;
thanku for your answer.but one more confusion ? My clint is pvt ltd company having free reserve of Rs.18.00 lacs + share cpital Rs.2.00 lac total =20 lacs represented by Bank Balance of rs,20.00. ther is no other assets. then hou to calculate Buy Back price ? Is theie any provision in company Act? Ca i have Buy Back price Rs.18 lacs/100 shares =Rs.18000/- per sahres If Buy back is 50 % of share capital?
CAclubindia
