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Section 19

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Kalpesh Soni

12 Points Posted on 20 March 2020

what if subsidiary company receive share as legal representative from non deceased member ???

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Quick Summary

Section 19 outlines specific circumstances where a subsidiary company is permitted to hold shares in its parent company. These exceptions primarily cover situations where the subsidiary acts as a legal representative for a deceased member of the holding company, holds shares as a trustee, or was a shareholder prior to becoming a subsidiary. Receiving shares as a legal representative for a non-deceased member is generally not allowed under this section.

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As per my knowledge a subsidiary is allowed to hold shares as the legal representative of a deceased member of the holding co. by virtue of first proviso to sec. 19

CS Rashi Jain

Practicing Company Secretary @ RASHI JAI

1300 Points Posted on 20 March 2020

Exceptions applicable to subsidiary company to not to hold shares in its holding Company:
[a] where the subsidiary company holds such shares as the legal representative of a deceased member of the holding company; or
[b] where the subsidiary company holds such shares as a trustee; or
[c] where the subsidiary company is a shareholder even before it became a subsidiary company of the holding company:
If subsidiary company receive shares as legal representative from non deceased member it is not allowed.