If co. A acquires 51% shares of co. B and
co. B holds power to appoint or remove it's majority directors, then what will be their relationship
and is their any section prohibiting the same
4 Replies
Navin Agarwal
(354 Points)
Replied 18 March 2018
nice question... section 19 prohibits only subsidiary company from holding shares in holding company...
Aditya Dude
(93 Points)
Replied 18 March 2018
section 19 say subsi company cannot hold any shares in holding company.
unless 3 exception .
unless 3 exception .
Navin Agarwal
(354 Points)
Replied 19 March 2018
yes... but the same doesn't answer whether subsidiary can appoint majority of directors in holding or not
Jatin Bajaj
(CS)
(2930 Points)
Replied 19 March 2018
As per Section 2(87) of the Companies Act 2013, Subsidiary Company in relation to the another Company means a Company in which the holding Company :
Controls the Composition of Board of Directors.
Power to control or change the majority of Board of Directors vest with the Holding Company.
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