HOLDING & SUBSIDIARY CO.

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38 Points Posted on 05 September 2009

Pl help:

Company "A Ltd."  is holding 50% of paid up share capital of  "B Pvt. Ltd".  Mr. X is Common Director in Both the Compnaies and Holding 10 % shares in 'A Ltd.' and 1 % shares in 'B Pvt. Ltd.   Is 'B Pvt. Ltd. is Subsidiary Co of  "A Ltd."

Regards

Vivek Kr. Tibrewal

Kolkata

 

 

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On 05 September 2009 at 14:42 Report
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Company Secretary
60271 Points Posted on 05 September 2009

 

Dear Mr. Vivek
 
Section 4 of the Companies Act, 1956 dealing with meaning of holding company and subsidiary company. Section 4(b)(ii) says where the first mentioned company (A Ltd.) hold more than 50% of its equity share capital of other company (B Ltd) then company B ltd. will be treated as subsidiary of A. Ltd.
 
In your case company hold only 50% of the share capital of company B Ltd., so it will not be treated as subsidiary company.
 
 
Regards
1 Reply
On 05 September 2009 at 15:59
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Posted on 05 September 2009

In this case the Shareholding clause is not applicable. But We have to check the no. of directors in each company, as the directors relationship is also one of the important factor for considering the Holding and Subsidiary Company relation.

 

If you need further clarification than contact me.

 

Ankur Shah (Practicing Company Secretary)
“Guru Gautam” Bungalow, Inside Parshwa Tower,
Nr. Shyamal Cross Road, 132ft. Ring Road,
Satellite, Ahmedabad – 15
 
Contact: + 91-9427633901
E-mail: ankurjewel @ gmail.com
Blog: csankur.blogspot.com

 

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On 05 September 2009 at 21:00

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