Complicated transaction

This query is : Open

CA Darshak Shah (Querist)
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14 April 2012 Recently I have come across a strange matter..Let me share it with you.

One person purchased some land/plot of Rs 40,00,000/- in cash in the name of Company on stamped agreement (dastavej) in January-2012(Say 20 January when transaction occured)

Company Incorporation date is 3 days after the above agreement date.(Say 23rd January-Certificate of Incorporation)

Company doesnt have any machinery or loan etc till 31-3-2012..It has only 1 Lakh Authorised Share Capital..

Now how to adjust such transaction in book?

*
Please Note That In Stamped agreement, the wordings were

...in the name of...Mr XYZ, director of ABC Pvt Ltd..

Stamp Paper were purchased in the name of
ABC Pvt Ltd..

Will it be consider as property of company or Individual?

If it is of Individual..Can company Accept/Reject it?
What is the Time period for passing resolution or any procedure?

CA Kishore Tallam

CA Kishore Tallam (Expert)
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14 April 2012 If a person has purchased land, it cannot be the property of the company. It will be his property only.
So need of adjusting the transaction in books.

CA Darshak Shah

CA Darshak Shah (Querist)
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14 April 2012 Ok Sir,

But the stamp paper was purchased in the names of Pvt Ltd..
Then also it will be personal property?

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Guest

Guest (Expert)

14 April 2012 You have to look at the substance over form... The consideration was paid by the director. If he wishes to bring the land in the books of company, let the company issues him share for consideration other than cash.

CA Darshak Shah

CA Darshak Shah (Querist)
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14 April 2012 Thank You Mr Ashwin Shara,

Is company required to pass the resolution for the same?
And
Can director bring such land in next financial year..I mean is there any time limit to pass the resolution?

CA Kishore Tallam

CA Kishore Tallam (Expert)
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14 April 2012 Whenever u want the land to come into books of accounts, before that this resolution to be passed in the board for allotting shares other than cash.

CA Darshak Shah

CA Darshak Shah (Querist)
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14 April 2012 Ok..I got it..
That means there is no time limit..right?
Than I will bring it in Current Year Only..

Guest

Guest (Expert)

14 April 2012 Resolution will be required to bring such land in books and issue shares.

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CA Darshak Shah

CA Darshak Shah (Querist)
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14 April 2012 Mr Ashwin,

Thanx for precious guidance..
I will appriciate if you can provide me sample attachment of the same..
Please mention time limit if applicable for passing such resolution..