Ad Free CAclubindia and Daily Updates on your Mobile. Subscribe Now!

lein on Shares

Amit Surana (Student CA/CS-Professional) (268 Points)

28 May 2011

what is lein on shares?

Plz explain me

Reply
Follow
Share

7 Replies

deepti (none) (39 Points)
Replied 29 May 2011

where a shareholder is indebted to company, he is not allowed to dispose off his shares before clearing his debts to the company. in such case company can create lien on such shares.

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

Amit Surana (Student CA/CS-Professional) (268 Points)
Replied 29 May 2011

Ok. the company can recover the debt by selling the share, but what will happen to the amount standing to che credit of the shareholder ( i mean the amount paid by the shareholder as application,allotement,etc) can it be refunded or it gets lapes.

Rajnikant Vadigoppula (CA, CS And CMA Final) (919 Points)
Replied 29 May 2011

lien on shares only utilised at the time of winding up

1 Like

Amit Surana (Student CA/CS-Professional) (268 Points)
Replied 29 May 2011

Originally posted by : Rajnikant Vadigoppula
	lien on shares only utilised at the time of winding up

Is it So, R u sure??????????????????????

deepti (none) (39 Points)
Replied 30 May 2011

lein is not necessarily exercised at winding up. there r only 2 conditions. it shud be authorised by article. and co shud file a suit in court for exercising lien.

Upgrade to CAclubindia Pro. Subscribe Now!

Amit Surana (Student CA/CS-Professional) (268 Points)
Replied 30 May 2011

what happens to the amount already paid by the shareholder, did it gel lapsed??????

deepti (none) (39 Points)
Replied 31 May 2011

i think it will be deducted from the amt of debt. because such amount is already paid to the company by the shareholder and he is liable to pay his debt over and above the amount already paid by way of calls, application money etc. .after exercising lien, the shareholder ceases to be a member. so the logical thinking is that such amount will be deducted from the amount of debt.