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Originally posted by : risabh |
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i have a doubt in provsional contract and prelimianry contract
i know what are they and their differences
suppose a company gets its certificate on incorporation on 10th feb and gets its certificate for commencement of buiness on 20th feb..
now if a company makes a contract on 15th feb ie they purchased furniture from one party and they refused to pay them back??
now is the company liable?....i know yes but why , in munish bhanari buk its written that provisinal contracts are not binded to the company ..
pls help..pls use simple language , dont write law terms ..explain it in the easiest langauge if possibe?
if its written somewhre ki company is not bind to do this thing( iska matlab bhi bata do) in simple language? |
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you know the basic differences thats good enough dont get confused dear provisional contracts are those contracts which are made on the behalf of the company after getting its certificate of incorporation and before getting its certificate of commencement of business
as you know only public company requires certificte of commencement of business to excercise various powers.
private company only requires certificate of incorporation to commence its business..
now in your case u said company got its certificate of incorporation on 10th feb and certificate of commencement of business on 20th feb and contract date falls on 15th feb that means it clearly state that it is a public company and the contract is a provisional one
now the question arises whether it is binding or not?
so in case of public company its not binding until the company gets its certificate of commecement of business and whereas when it has not taken such certificate it is not binding
for you to understand "jabtak ek public company certificate of commencement of business lene mine fail hojati hai, tab tak koi contract jo kia gaya ho certificate of incorporation lene ke baad company dwara void hota hai. sirf public company ke case mien provisional contracts aatey hain toh upar waley case mien company agar certificate of commencement of business leleti hai toh contract valid hojayega and company bound hojayegi"
preliminary or pre-incorporation contracts company be bound nahin hotey hain agar company accept nahin karti hai toh promoters liable hotey hain. so dont get confused munish bhandari's book is correct.
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