sec 41 of cos act,1956

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Kiran Singla (Querist)

30 August 2010 Plz clarify sec 41(2) of the cos act. Can a person be a member without holding equity shares and merely by egreeing in writing to have his name entered in the register of members ?

Ankur Garg

Ankur Garg (Expert)

30 August 2010 Membership by agreement in writing

No person can become a member unless he has agreed in writing. Agreement in writing is must to become a member of a company.

To become a shareholder there must be an agreement in writing under section 41(2) of the Companies Act between the shareholder and the company. The words 'in writing' indicate by necessary implication that an application for allotment of shares should be made in writing.

However, as long as a person's name is not entered in the Register of members, he will not be considered as a member despite he has already purchased the shares of the company.

Regards

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Kiran Singla

Kiran Singla (Querist)

31 August 2010 Thanks very much for the explanation.

Ankur Garg

Ankur Garg (Expert)

31 August 2010 You are always welcome Ji.

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