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COMPANY LAW

adam basha (SPA) (44 Points)

08 February 2011

Hi frnds, pls help me for the below questions

1) members of a limited company may never have unlimited liability.
2) what is the difference between reserve capital and capital reserve?

3) Discuss the duty of a director to disclose his interest in contacts to
be entered into by the company. What are the consequences of non
disclosure?
4) What do you mean by pari passu? Can a company issue debentures with pari passu clause?
5) What are the redmedies for misrepresentation in prospectus?
What are the particulars to be included in an advertisement inviting
deposits by a company?

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Sachchidananda Ghosal (MBA(Finance) PGPBM-Banking & Insurance B.Com) (167 Points)
Replied 21 February 2011

1) Condition under which the loss that an owner (shareholder) of a business may incur is limited to the capital invested in the business and does not extend to personal assets. The forerunners of limited-liability companies were limited partnerships, which were common in Europe and the U.S. in the 18th and early 19th centuries. In limited partnerships, one partner is entirely liable for losses and the other partners are liable only for the amounts they invested in the business. After the Joint-Stock Companies Act (1844) in England made incorporation easier, joint-stock companies with limited liability for all members became widespread. The development of the limited-liability company was crucial to the rise of large-scale industry in the late 19th and 20th centuries, since it enabled businesses to mobilize capital from a variety of investors who were unwilling to risk their entire personal fortunes in their investments. See also risk.