Buyback of shares

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Querist : Anonymous

Querist : Anonymous (Querist)

26 April 2010 A Pvt Ltd Company has issued equity shares to two shareholders- A & B, at a premium. Now, it wants to buy-back some shares from A at book value. can it be done and is valid in the eyes of law?

Aditya Maheshwari

Aditya Maheshwari (Expert)
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26 April 2010 Preferable if done at fair market value than book value though even done at book value is valid.

CS Jithesh (ACS,)

CS Jithesh (ACS,) (Expert)
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26 April 2010 According to me it is valid as long as no forceable majurea is there on A to sell the shares back to the company

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Querist : Anonymous

Querist : Anonymous (Querist)

26 April 2010 What about the Securites Premium Amount received at the Time of original issue of shares. Will they be considered as a part of Capital of the Company.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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26 April 2010 read section 77A for that.