What will be the status of a Private Company which is a subsidiary of a Public Limited Company under the Companies Act, 1956? Whether it will be treated as a Public Limited Company and will have to comply with all the provisions of Companies Act, 1956 are as applicable to a Public Limited Company?
In my opinion, the definition of the term Public Limited Company provided under the Companies Act, 1956 was amended vide Companies (Amendment) Act, 2000 to include a Private Limited Company which is a subsidiary of a Public Company. Hence a Private Company which is a subsidiary of Public Limited Company will be treated at par with Public Limited Company and accordingly will have to comply with all the provisions applicable to Public Company under Companies Act, 1956.
This is my opinion and request you to throw some light on the matter.
13 February 2012
Once a pvt ltd company becomes subsidiary of Public ltd company it shall be treated as Public ltd company. all the provisions which are applicabl on public ltd shall be applicabl on such subsidiary..
But still this company will be pvt ltd as name shall remain unchanged and AOA will contain restiction of section 3 etc..
13 February 2012
The Act has, in several sections, identified a private company which is a subsidiary of a public company and placed it at par with a public company, and thereby differentiated it from a private company which is not a subsidiary of a public company. It should be noted that this special treatment to the private companies which are subsidiaries of public companies does not create a separate class of companies nor does it change the basic structure of such company as a private company. It merely deprives these companies of the privileges and exemptions under the Act to which private companies are entitled. For the purposes of the following provisions of the Act, a private company, which is subsidiary of a public company is equated with public company;
CAclubindia
