holding Co.

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Querist : Anonymous

Querist : Anonymous (Querist)

12 May 2010 pl. tell me how much share should have,for holding co. to subs. co.,also tell me about the Govt.Co

Rahul Gupta

Rahul Gupta (Expert)
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12 May 2010 As per the defination of Subsidiary Co. Company can be said to be sub. of another if that other controls its Composition of Board of Director or holds more than 50% paid up equity share capital (Sec 4 of Co's Act).

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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12 May 2010 agreed with Mr. Rahul

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Rahul Gupta

Rahul Gupta (Expert)
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12 May 2010 As per Section 617 of Co's act>
Government company, means any company in which not less than fifty one per cent of the paid-up share capital is held by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments, and includes a company which is a subsidiary of a Government company.

Some of the features of the Govt Co. are >

- It is formed under the provisions of the Indian Companies Act, 1956.
- The total share capital or 51 percent or more of share capital is held by the government.
- It enjoys the status of a legal entity and therefore it can use or be sued by others.
- The finance of a government company is obtained from the government and from private share holders.
- The employees are governed by the rules prescribed for the company by the board of directors.
- The directors are nominated by the government depending upon participation of private capital.