Definition of subsidiary
This query is : Resolved
25 March 2008
Please clarify! The Companies Act,1956 defines subsidiary.A company which holds more than 50% of the voting power or equity capital of other company,that other company is the subsidiary of the first mentioned company.But if a company holds just 50%,then would that be considered as subsidiary!!!
25 March 2008
I just want to clarify that its 50% or more.
25 March 2008
it is exactly 50%
25 March 2008
As per section 4(1)(b)(ii) of the companies act 1956, if a company holds more than half in the nominal value of equity share capital of another company,than such another company is a subsidiary of first mentioned company.The wording of section i.e.more than half,clearly says that it is more than 50% & not exactly 50% even.
25 March 2008
> then 50%
25 March 2008
IT IS MORE THAN 50% OF SHARE CAPITAL OR VOTING POWER WHICH IS REQUIRED TO BE HELD BY ANOTHER COMPANY TO BECOME A SUBSIDIARY OF THAT COMPANY AS PER SEC 4 OF COS ACT.
R.V.RAO
R.V.RAO
25 March 2008
MORE THAN 50 % DOES NOT AT ALL MEANS 50 %
25 March 2008
it should be more than 50%.
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