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kapil (-) 19 October 2010
|Originally posted by : Sharad Saini|
company can not buy back more than 25% of paid capital and reserves during its entire lifetime and it can not buy back more than 10% of capital and reserves in a single year.
arunkumar (CA Final NCMP (Level - I)) 19 October 2010
Sec. 77A clearly provides that upto 25% of the paid up capital + free reserves shall be bought back in a year. hence upto 25% is permissable in a single year.
If the company intends to buy back less than or equal to 10% of the paid up capital + free reserves then a board resolution is sufficient.
swapnil (CA Final) 19 October 2010
1. buy back can be possible upto 25% of paid-up share capital + free reserve,
provided, special resolution has been passed and only 1 buy back in a single Financial Year for e.g
first buy back is 1.11.2007
than second buy back is 1.1.2008 = it is wronge [not possible]
but buy back on 11.4.2008 = it is validly possible, because in a single F.Y.
2. Buy back can be possible upto 10% of paid-up share capital + free reserve,
provided, Board Resolution has been passed [no need of special resolution], and tha gap between 2 buy is subject to the 365 days. it means that exactly 365 days. for e.g
first buy back is 1.7.2006
than second buy back is possible on or before 1.7.2007.
if buy back is make before 1.7.2007 = than it is not possible to buy back - and not a valid buy back
so that why i am saying exactly 365 days.