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Share Application

Kausha Mehta (CS FINAL STUDENT) (187 Points)

03 December 2009

ABC, a partnership firm, subscribes for shares of XYZ Ltd. The company rejects the application. Can it do so?

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12 Replies

Hareesh H Sharma (Cleared IPCC..now article) (894 Points)
Replied 03 December 2009

I think a partnership firm cannot become a member of a company whereas the partners can become jointholders of shares

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Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 03 December 2009

Rejection by company is correct.

karn (trainee) (172 Points)
Replied 04 December 2009

100% legitimate.

CS.Bhagwati charan (company secretary) (52 Points)
Replied 04 December 2009

If Article of association of company not allowed partnership firm become a member of company than rejection is valid.

K.S.Sashidhar (Article Assistant) (91 Points)
Replied 04 December 2009

100% correct.

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RAMESH POLINENI SAI (ca) (359 Points)
Replied 04 December 2009

A partnership firm cannot become a member of company because i doesnt have a seperate legal entity capacity. the company treatment is correct

CA Trinath Galla (student) (3130 Points)
Replied 04 December 2009

Originally posted by :RAMESH
"	A partnership firm cannot become a member of company because i doesnt have a seperate legal entity capacity. the company treatment is correct	"

Pranjal (Article) (52 Points)
Replied 04 December 2009

partnership firm cannot become the member of the company so the rejection by the company is valid.

samip karpe (accounts assistance) (152 Points)
Replied 04 December 2009

trinath is Right.

SOURABH GUPTA (CS) (100 Points)
Replied 04 December 2009

I THINK THAT COMPANY REJECTION IS WRONG.

CAN ANY BODY CITE/QUOTE ANY SECTION/PROVISION ETC. IN WHICH IT IS REFERED THAT A PARTNERSHIP FIRM CAN'T BECOME A MEMBER OF COMPANY.

AS FAR AS MY OPINION PART. FIRM CAN BECOME MEMBER OF COMPANY

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meenu (cs) (416 Points)
Replied 07 December 2009

Sourabh,

Jusify your answer pls.

Best Regards,

Meenu

karn (trainee) (172 Points)
Replied 08 December 2009

Dear all,

plz refer to the membership section in companies act, the identity of a firm is not a sole as of a company and hence its name cant be added into the register of members also it cant subscribe shares in its own name.

this i guess is self explanatory..

regards..