Re : Reversal of allotment of shares

Hi friends in one of my client company case which is a limited company had a agreement with propritorship firm of one of the directior of the company taking over all its assets and liabilities in consideration of shares of the company.

Later on company gets to know that one of the account of Properitorship firm was declared NPA and dat will affect the working of the company so now company wants to revert this agreement so wat are the alternatives avaiable to the company

Whether they have to opt for reduction in capital or buy back of shares, buy back will cost a lot to company bcz the shares are arund 20 lacs.

Friends kindly guide me in this matter at earliest.

Replies (1)

According to me in company related agreement the Disclouser is very important and if disclouser is not given properly it will be void abinitio, so in the above agreement the company will not be resposible and the agreement will be void from the point of time it was entered. Except buy back there is also another way for reduction of share in section 94, and 100  that can be taken.

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