Ipcc business
This query is : Resolved
01 November 2013
The AOA of H ltd contained a provision that up to 3% of the issues price of the shares as underwriting commission may be to the underwriters. The Board of directors of the company decided to pay 4% underwriting commission. Can the Board of Directors do so? Also state the provisions of law in this regard as stated under Companies act 1956.
CA Vijeta Verma
(Expert)
01 November 2013
AOA can prescribe a lower rate of underwriting commission & BOD must follow that rate only.Since company can pay a maximum rate of 5% underwriting commission,so alteration in AOA has to be made first.
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CA Pallav Singhania
(Expert)
01 November 2013
Agree with Expert,
AOA can prescribed lower rate of commission...
However, you can alter in AOA via resolution...
AOA can prescribed lower rate of commission...
However, you can alter in AOA via resolution...
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