WOS subsidiary

Pvt ltd 729 views 3 replies

Sandeep

cars

38 Points Joined February 2009

Hi all,

we have this foreign company willing to incorporate a new co in India with 100% shareholding. Given the necessity of at least two shareholders in the indian company, we would proceed with transferring 99% of the shares to the foreign company, with a very nominal stake of 1% share transferred to an individual.

We have also been told that it would be possible to transfer the 100% shares (100%) to the foreign company, which in turn could nominate the individual as a shareholder and to represent the foreign company. We are wondering if this can be possible and what are the steps to be taken.

Thank you all.

Replies (3)

Kumar

Legal Consultant

358 Points Joined September 2007

Dear sandeep,

Yes,you are totally in line with Companies Act norms,always maintain the 2 members norns.Please also see/check what the activities for which company is going to be incorporated is with the FDI norms and take the permission accordingly before incorporating such company.

Regards

CS MD Osman Akthar

Company Secretary & CA(Final)

78 Points Joined June 2007

Dear Sandeep,

You can not go ahead with the opinion as such.

As per Section 49(3) of Companies Act 1956, the above said option is for Indian Companies only, not to a Foreign Company.

Expert's opinion solicited.

Bhakti

267 Points Joined December 2009

Section 49 (3) is for INVESTMENT by the Company. In the case given above what is getting transferred is not the Investment but simply the holding in capital. So Mr Kumar is totally justified.