Who will be liable for any breach of provisional contracts entered into by a Public Company with a third party before commencement of business? If the Company does not receive the certificate of commencement, can the third party enforce the contract against the company?
Menu
Provisional Contracts
Replies (2)
no, provisional contracts will bind the company only after receiving the certificate of commencement of business.
A third party can enforce specific perdormance suit against the company on the folowing grounds;
1). if the agreemnet is prior tp the Incorporation certificate date and if the said agreemnet has a reference of consideration price and if such amount is adopted in the first board meeting of the company as preincorporation expences and this transcation is reflecteed in the first annual dircetors report and annual accounts of the company.
2). If the said agreemnet has reference by stating that, post incorporation of the company, the said transaction will be treated as the transaction of the company.
Gopal
Recent Topic
- Total income less than 12 lakhs but after processi
- Is Getsvision Solutions right for SMTP bulk email
- Queries on Stock/ETF gifting.
- Adding bank account for the deceased for ITR refun
- SALE OF EQUITY ON THE LAST DAY OF THE FY 2024-25 N
- Which ITR form
- Form 103 id delayed for submission for more than 1
- Composition scheme
- Input tax credit under igst under insurance compan
- ITR Form to be used
Related Topics
CAclubindia
