Company law

Hi,

Can you please post ur query clear again..!!!

Buyback is nothing but you r  repruchasing the securities which you already sold to other person !!!!!

 

 

 

 

Purchase of shares means buying shares of a particular company. And buy back means the buying the shares issued by the same company. Purchase doesnt represent buying of own shares. Buy back denotes buying own shares back from the public.

As per companies Act 2013 ;A company cannot purchase itson share.....so then what is buy back...

Sec 68 (1) Notwithstanding anything containing in this Act, but sujected to the provision of sub-secrion (2) , a company may purchase it's own share or other specified securities( herein after referred to as buy back) out of �) it's free reserves �) the securities premium account or �) the proceeds of the issue of any share or other specified securities provided that no buy back of share or other specified securities shall be made out of the proceeds of an earlier issue of the same kind of share or same kind of other specified securities. (2) No company shall purchase it's own share or other specified securities under sub- section (1) unless �) the buy back is authorized by its article �) a special resolution has been passed at General meeting of the company authorizing the buy back. Provided that nothing could containing in the clause shall apply to a clause where �) the buy back is 10% or less of the total paid up equity capital and free reserve of the company and �) such buy-back has been authorized by the board by means of a resolution passed at it's meeting �) the buy back is 25% pr less of aggregate of paid up capital and free reserve of the company. Provided that in respect of the buy back pf equity share in ang FY the reference to 25% in this clause shall be construed with respect to it's total paid up equity capital in that FY