Regarding material information in prospectus

A prospectus issued by a company contained a promise of subscripttttion of a substantial amount by some persons so as to introduce the public to subscribe. The plaintiff who was allotted 10 shares alleged misrepresentation. Decide.

The company has stated that the person has promised to subscribe and not already subscribed , this confuses me.

Replies (1)

It's a case of Misrepresentation ,since Inducing Public that some one(may be a person of Repute) has subscribed substantially  for the shares amounts to Misrepresentation........There's even a case law having same facts but I couldn't just recall the same since being in the P.E 2 syllabus........

Manish !

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