As per Company Act, If 51% or more of the paid-up share capital of a company is held by the Central Government and/or any one or more State Governments, the company becomes a Government company. A subsidiary of a Government company is also a Government company.
Please inform whether:
1. PAID CAPITAL includes Equity and Preference both or only Equity.
2. The 68% equity of a Company held by Government (55.6% GoI & 12.4% Banks, LIC & FIs)
but together with Preference capital the holding of GoI, Bank, LI and FIs is less than 51% whether it is a Government Company.
Please guide us with your expert advise.
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Government company
Replies (3)
The paid up capital includes both equity and preference share capital, so both have to be counted while calculation of % shareholding.
Since the % shareholding by Govt. cos. is less than 51% of total paid up capital the said company can not be said as Government Company.
Agree with Mitali
Absolutely Correct mitali
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