Assertion (A): Shareholders are not, in the eye of law, part owners of a company. The company is something different from the totality of the shareholders.
Reason (R) : Shareholders are collective owners of the company.
Codes :
Shareholder Status: Assertion A Analysis
Assertion (A) states that shareholders are not part owners of a company in the eyes of the law, and the company is separate from its shareholders. This aligns with the established legal principle of a company being a separate legal entity. Therefore, Assertion (A) is correct.
Shareholder Role: Reason R Analysis
Reason (R) claims that shareholders are collective owners of the company. While shareholders collectively own the company's shares and have control rights, they do not directly own the company or its assets. The company itself, as a separate legal entity, owns its assets. Thus, describing them as "collective owners of the company" is legally inaccurate. Therefore, Reason (R) is wrong.
Conclusion: Assertion and Reason Evaluation
Based on the analysis:
- Assertion (A) is correct.
- Reason (R) is wrong.
This corresponds to Option 3: (A) is right, but (R) is wrong.
Important Questions from Company law
- The problem of double taxation in international transactions can be reduced by:
i. Market agreement
ii. Multilateral agreement
iii. Bilateral agreement.
iv. Trade agreement - Under the Companies Act 2013, which of the following company is required to constitute a Corporate Cocial Responsibility Committee?
(a) company having networth of Rs. 500 crore or more
(b) company having turnover of Rs. 1000 crore or more
(c) company having net profit of 5 crore or more
(d) company having net profit of 2 crore or more during any financial year
Choose the most appropriate option : - Which one statement is correct from the following statements ?
- Which of the following statement (s) is/are incorrect? Answer using codes given below :
(a) In Attorney General v. Great Eastern Railway Co. the House of Lords observed that the doctrine of ultra vires as it was explained in the Ashbury case, should not be maintained.
(b) Section 13 (i) (c) of the Companies Act provides incidental objects which need not be stated in the memorandum.
(c) If incidental objects are not stated in the memorandum, they would not be allowed by the principle of reasonable construction
(d) The doctrine of indoor management operates to protect insiders against the company
Codes : - Which of the following cases is about doctrine of indoor management ?
