Buy back of shares

Save Share

This query is : Resolved

CA Saxena (Querist)
Follow

12 February 2013 Want to buy back approx 12% shares in a pvt limited company at PAR VALUE from a single shareholder

Is it possible to do so??

What is the procedure and forms that need be filed.

Thanks in anticipation.

Ajay Mishra

Ajay Mishra (Expert)
Follow

12 February 2013 Hi

You can.

The following terms and conditions are required to be fulfilled by a company in order to become eligible to buy-back its own securities:—
(a) There must be a provision in the Articles of Association authorising the company to buy-back its own shares, otherwise the Articles must be amended by a special resolution to incorporate a suitable provision.
(b) A special resolution must also be passed in a general meeting of the company authorising the Board of directors to buy-back the shares of the company or other specified securities. upto 25% of the total paid-up capital and free reserves provided that the buy-back of equity shares in any financial year shall not exceed 25% of its total paid-up equity capital in that financial year.
(c) The maximum quantum of buy-back can be upto 10% of the total paid up capital and free reserves by the authority of the Board by means of resolution of the Board meeting.

Message likes : 1 times

CA Saxena

CA Saxena (Querist)
Follow

12 February 2013 sir, can buy back be done at par value of shares??

Ajay Mishra

Ajay Mishra (Expert)
Follow

12 February 2013 Hi

I am not sure on this, but it can be par value in case of un-listed company as a minimum price of buy back.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now