We have one Proprietary Say 'X', We have another pvt ltd in Dubai say 'Y'. X (Proprietary) wants to buy 100% shares of 'Y' and want to manager business of 'Y' from X (Proprietary). can this possible?
or is there any provision that only pvt ltd company can purchase another company & not proprietor.
22 November 2012
Proprietor y firm is eligible to purchase the 100% share of Pvt. Ltd. Company, there is no such restriction under the companies act. But only condition is that pvt. ltd. co. should have minimum no. of members (2) & directors (2).First u have to check out for whether articles of company specifically provides for holding of minimum No. of share then each director is required to hold the minimum no. of shares, otherwise company will be director less which will attract some others provisions. Company should have atleast 2 directors so it is not possible for them to manage individually it should be managed by atleast 2 persons. while transfering shares to proprietory firm u have to check out for provision of Sec. 56(2)viia), & (vii) is applicable
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