29 January 2010
Can the buy back of shares by a private limited company can be made twice within 365 days of previous buy back of same shares? Please tell me the reference also, if it is written sumwhere......... its really urgent........
according to Section 77A subsection(2) proviso: no offer of buy-back shall be made within a period of three hundred and sixty-five days recokned from the date of the preceding offer of buy-back, if any.
Explanation.-For the purposes of this clause, the expression "offer of buy-back" means the offer of such buy-back made in pursuance of the resolution of the Board of Directors.
07 February 2010
Sorry Ms Vandana..but my interpretation says some diffent thing... My interpretation says that there is no restriction on making buy back twice a year, which can be interpreted from the wording of provisions in section 77A(2)(c ) laid below. My interpretation says that buy back can be made twice or thrice in a financial year however total buy back should not increase 25% of Paid up equity and free reserves in any financial year.
However, the process of buy back shall be completed within 12 months from the date of special resolution in which the approval of buy back is passed.
Relevant Provisions Section 77A (2) says Clause (c) the buy-back is of less than twenty-five per cent of the total paid-up capital and free reserves of the company : Provided that the buy-back of equity shares in any financial year shall not exceed twenty-five percent of its total paid-up equity capital in that financial year
(4) Every buy-back shall be completed within twelve months from the date of passing the special resolution under clause (b) of sub-section (2).
CAclubindia
