Share capital for Cash !

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Abc Pvt Ltd is incorporated with a paid up share capital of 1 lakh. The promoters do not want to open a bank account for at least 2-3 years (as the company will not undertake full fledged activities).

 

Can the initial capital be bought in cash and shown as cash in hand (in balance sheet) for 2-3 years?

Replies (3)

Yes, you can do so.

Auditor will raise queries. It cannot be done

Thanks Jeets. I also tend to agree with you. Can anyone throw some light on this so called grey-area of the Companies Act, 1956 ?


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