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Acoounts doubt about forfeited shares

harish ragav (student-IPCC) (407 Points)

04 December 2012

can share holder get back his remaining capital from from the company when he was forfeited for non payment for dues?

rply pls

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10 Replies

Abhimanyu Bind (CA Final Student & Audit Assitant) (2051 Points)
Replied 04 December 2012

No. Forfiet itself means that earlier paid amount of shareholder will not be returned him back by company.

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Prakhar (student) (55 Points)
Replied 04 December 2012

no shareholder can not get bach his forfeited money

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Devadas K S (One life one Dream) (3525 Points)
Replied 04 December 2012

Agree with Abhimanyu..........

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iam4rock (-) (43 Points)
Replied 05 December 2012

Nope..for ex if companny has called up 10 rs per share & the shareholder has paid 9rupees.. Still the shares will b forfieted(if decided by the bod) for non payment of that 1 rupee...if the company gives back the money to shareholders on forfieture then it will encourage the shareholders not to pay the calls on time.hence the company does nt return the money..

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harish ragav (student-IPCC) (407 Points)
Replied 05 December 2012

can a share holder sue against the company?

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Sanjeev Parasrampuria (B.Com CA Final CS Final) (273 Points)
Replied 05 December 2012

Dear Harish,

Before Forfeited of Share, company has send a notice to those shareholder from which call money not received and if after sending notice those shareholder who not paid money to company in prescribed time limit then company will forfeited his share i.e. forfeited money which was received earlier.

So after forfeited, any one can't sue against Company.

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subhajit behera (student) (65 Points)
Replied 05 December 2012

Forfieted amount can not be returned to shareholder thats why the porfit or loss on reissue after adjusting the forfieted amount has to be transfered to capital reserve..

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CA Suryakant Dubey (CA ) (931 Points)
Replied 05 December 2012

NO...it can't be paid back to shareholder....Since company makes a call for the due pending in respect of shares,,,if it is not paid,,,the whole amount paid earlier is transferred to Share Forfeited A/c

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CA Lokesh Kumar Tiwari (Asst. Finance Manager) (195 Points)
Replied 05 December 2012

Dear Harish

There is no ground to file a suit against the compnay in case of forfeiture of shares.

if u ever saw a share certificate, there is always a condition written on the face of share certificate that if holder does not pay call money, company has a right to forfeite the share and in that case holder can not claim for his loss.

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