Doubt regarding Sec42(2)

section 42 caters to private placement of any security including shares.. so, in case of a private company maximum no. of members is 200. hence if you are making private placement of shares, then you have to ensure that existing + new members do not cross 200. on the other hand, if you are making private placement of securities other than shares, then you can Max 200 such security holders each year. for a private company, there is no limit on number of other security holders (ie other than shareholders), but per year only 200 max can be added.

Originally posted by : Madhwesh K
	section 42 caters to private placement of any security including shares.. so, in case of a private company maximum no. of members is 200. hence if you are making private placement of shares, then you have to ensure that existing + new members do not cross 200. on the other hand, if you are making private placement of securities other than shares, then you can Max 200 such security holders each year. for a private company, there is no limit on number of other security holders (ie other than shareholders), but per year only 200 max can be added.

Maximum Limit for number of shareholders at any point of time for a pvt ltd company is 200 members