2. A land is to be purchased & registry of that Land will be in the name of the proposed company.
3. Payment for purchase of Land is being made by the Promoters of the Company in THEIR OWN A/C (Personal Saving Account of Promoter)
4. Thus, Land is RECEIVED by the company against the payment by the promoter.. So, the Company will ALLOT SHARE FOR CONSIDERATION OTHERTHAN CASH (after incorporation) to those promoters who paid for the land.
Query on above :
1. Is it in order ?
2. If yes, then which documents / agreements has to be executed? n also provide the formate of the same.
3. If No, then what is wrong points in this procedure ? & whether the route of ratification of pre-incorporation contract wid third parties can be adopted in above case?
4. If the route of ratification of pre-incorporation contract wid third parties can be adopted in above case, then please tell me the steps for the same & also the format of pre-incorporation contract......
25 March 2010
I believe the above is not in order. For registration of land in favour of the company, the registrar will demand PAN of the company, copy of the board resolution and other documents which can be generated only once the company is incorporated.
As regards the law of pre-incorporation contracts is concerned, I will try to summarise the law as under:
It is a contract which purports to be made by or on behalf a company at a time when the company has not been formed.
In India, Under the provisions of s.19(e) of the specific Relief Act,1963,specific performance may be enforced against a company where its promoters have before incorporation entered into contract for the company and that the company have accepted the contract after its incorporation and communicated such acceptance to the other party to the contract.
There are other nitty gritties in the pre-inc contracts issue but i feel for your query, the above would suffice.
For land of value below Rs. 5 Lacs, there is no need of PAN number.. & Registrar is agreed if we submit pre-incorporation contact agreement instead of board resolution.. so the land registration is quite possible..
on the other hand, Specific Relief Act 1963 specifically allows to the promoter to enter in contract for the proposed company.. the land to be acquired is for the company..
So, in both the points, it is quite valid i think..
CAclubindia
