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Investment in shares by company

Others 540 views 3 replies

neha

293 Points Posted on 10 July 2021

The company has recently sold one of its property and wishes to invest this money in listed shares (investment in shares is included in MOA as the ancillary object)

Now, my question is since the company has no other income from any other source does investment in shares becomes its Main Object and should be included in Main object or shall remain in ancillary object as it is the company's money which is being invested and not soliciting to others.

Thanks in advance.

Replies (3)

i am Kashif

372 Points Posted on 10 July 2021

As per my information company can invest in listed shares if Company wants to made it his main business must required alter his object clause and mention as investment company but obtain an advice from experts

Anoop srivastava

223 Points Posted on 10 July 2021

Also you have to see that the invested amount does not exceed the reserve and surplus or 60% Of networth otherwise you have to take shareholders approval

Chirag

Professional

1979 Points Posted on 15 July 2021

Sec. 186 already permits company's to invest in securities, subject to certain riders, so MOA and object clause may have lesser impact but if company want trading as main business then MOA should be altered, including any approval required from SEBI...