Member in another company

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

26 July 2010 Can a company can become the member in another company? if yes what are the pre-requistes for a company to obtain shares in other company? any resulutions is required?.

Thanks in advance........

Jagruti (CS)

Jagruti (CS) (Expert)
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26 July 2010 Yes, Company can become member in another Company by its name.

The only requirement is Board of Directors need to pass resolution for making investments uner Sec 292(1)(d).

Querist : Anonymous

Querist : Anonymous (Querist)

28 July 2010 Hi Jagruthi,

Thanks for the suggestion

Is there any limit to invest in other company shares.

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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03 August 2024 Limit to Invest in Other Companies
Regulatory Limits:
No Absolute Limit: The Companies Act, 2013 does not prescribe an absolute limit on the amount a company can invest in another company. However, it sets out certain conditions and procedures for such investments.
Investment Limits in Specific Cases:
For Subsidiaries: Investment limits and conditions may apply if the investing company is acquiring shares in a subsidiary or associate company. These are typically governed by specific provisions within the Companies Act.
For Listed Companies: Publicly listed companies must comply with SEBI regulations regarding investments in other companies, including disclosures and limits on cross-holdings.
Disclosure Requirements:
Financial Statements: Investments in other companies must be disclosed in the investing company's financial statements.
Annual Returns: Companies must report significant investments in their annual returns filed with the Registrar of Companies (RoC).