Sandeep Prasad (2 Points)
27 March 2023
CA Rakesh Ishi
(Working at Private Company)
(8532 Points)
Replied 27 March 2023
Yes, the conversion of investment in optionally convertible debentures of another company into investment in equity shares of that company may require passing a resolution under the Companies Act, 2013.
Section 62 of the Companies Act, 2013 requires that any alteration in the terms of the memorandum of association of a company, including any increase or reduction in the share capital of the company, must be approved by way of a special resolution passed by the shareholders of the company.
Furthermore, if the company is a listed company, then it may also be required to comply with the regulations prescribed by the Securities and Exchange Board of India (SEBI) and the stock exchange where the shares of the company are listed, including obtaining any necessary approvals and making the requisite disclosures.
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