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Converting public limited firm to private limited

Vik B (5 Points)

21 March 2021

How can a public limited company be converted to private limited if shareholders are over 500 and are not responsive i.e not responding to share buyback offer.

Is there a provision to forfeit fully paid up shares?

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CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 21 March 2021

Forfeiture of shares can be done when the call money has not been paid by the shareholders for the amount due after due time.

A company can forfeit shares only when the Articles of Association of the company contain a provision for share forfeiture. A shareholder subscribing to the shares of a company owes the subscripttion price of the shares to the company. The company may call upon the shareholder to pay the price in instalments. The instalment payments are called call money. The call money is due from the shareholders. Non-payment of the dues can result in forfeiture of the shares.