A company in which 50.25% of shares are held by one State government while
the rest of the shares are held by private sector companies and by retail
shareholders.... watz de status of such company (public company or else)?????
plz clarify
9 Replies
Jayashree S Iyer
(Company Secretary)
(3224 Points)
Replied 25 January 2011
As more than half in nominal value of its equity share capital is held by a State Govt. it's a subsidiary of the Government company as per Section 4(1)(b)((ii) and consequently a Government company as defined in Section 617.
Sudhir Garg
(Service)
(236 Points)
Replied 25 January 2011
Hii
But Section 617 says about holding of ateast 51% to become government company.
Regards- Sudhir
cs ashwini kumar
(Company Secretary in Practice)
(173 Points)
Replied 25 January 2011
The Company in which 50.25% of shares are held by one/more State Govt./Central Govt. then the category will be "Indian Non-Government Company" and NOT the "Governemnt Company"
Neha Gupta
(PCS)
(377 Points)
Replied 25 January 2011
Yes, agreed with Ashwani ji its not a government comapny, it can be either public or private non govt. company
Jayashree S Iyer
(Company Secretary)
(3224 Points)
Replied 25 January 2011
Though Section 617 talks about 51% holding by a CG or SG, it also says that a subsidiary of a government company shall be a government company.
As per Section 4(1)(b (ii), a company shall be deemed to be a subsidiary of another if the other company holds more than half in nominal value of its equity share capital i.e. more than 50%. In the instant case 50.25% is held by the government company, so the government company is a holding company and the other is a subsidiary of a government company and consequently the subsidiary is also a government company.
This is my interpretation. Let's have the views of other experts in the forum too.
cs ashwini kumar
(Company Secretary in Practice)
(173 Points)
Replied 25 January 2011
Fully agreed with Ms. Jaishree.'s reply. However, as per query, 50.25% is held by the government (no where mentioned in the query about Govt. Company). This is my interpretation of the query posted by Mr. Preet.
CA Sandeep Kumar
(Audit Assistant)
(804 Points)
Replied 25 January 2011
sorry all.. i have given a wrong answer,, it is 51 %..
Rockstar D
(Student CA FINAL)
(74 Points)
Replied 26 January 2011
For becoming govt. co. 51% or more paid share capital should be held by state or central govt or both as case may be.
and subsidiary of govt co is also a govt co.
But as per ur case it held less than 51 % and it's not a govt co.
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