30 June 2010
A company has to convert its one project into Section 25 company as per agreement executed between company & governmen.
My query is whay & what is the best option available to the company:
1) whether the company demerge its said project and convert the same into section 25 company 2) whether form new section 25 company and transer/sale the said project to such new section 25 company.
Also inform about the procedure, advantages & disadvantage for above both options.
30 June 2010
Demerger will take a long time (approx 6 months), expensive (legal expenses), and then getting the resulting company registered as Sec 25 Company would also be difficult. Moreover, demerger will also not have any rationale.
A better and easier course of action would be to have a new sec 25 company and get the project / assignment transferred to it.
This will help. As regards, obligations, there are no such obligatons under the act. The RD will however, specify the same. There are many benefits as many provisions of the act are not required to be complied with. I will try to compile and provide a list.
before proceeding further please confirm that the agreement executed between company and the govt. gives the permission to incorporate a new company or not for the said project.
CAclubindia
