There are some steps, tips & Procedure of Private Limited Company in Coimbatore Formation in Chennai, Kerala and around India.
1. Promoter:
- Person Instrumental in the formation of the of Company and are named as Promoters in offer document.
- Director & Officer acting on their professional capacity cannot be deemed to be a promoter.
- FI, Bank & MF cannot be promoters as they hold share capital and be for the subsidiaries or companies promoted.
- May be a Natural person or company.
- Formulate scheme, get together subscribers, prepare MOA & register puts bankers, vendors & legal advisers underwriters, prospectus & solicitor not a promoter.
2. Promoters Contract:
- Cannot ratify the promoters contract before incorporation.
- Specific Performance can be enforced if the contract is warranted by terms of incorporation and the company accepted it communicated the same.
3. Legal Position of the Promoter:
- Not a agent and not a trusted occupies fiduciary position in company & require full disclosure of the relevant facts.
4. Duties of the Promoter:
- Without company’s knowledge promoter cannot make profit directly or indirectly at the company expense.
- Should not derive any profit through sale of prospector to the company without any material disclosures.
- Disclose to BOD, SH, Prospectus, MOA, AOA.
- Under Contract Act:
- Contract act cannot bind promoter.
Termination of Promoter’s Duties:
- Complete on incorporation & BOD appointed.
- But continues until the company has acquired the property and BOD takes over the management.
5. Remedy Available to the Company Against the Promoter:
- Not in a Fiduciary Position:
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Fails to make proper disclosure the company is entitled to rescind the contract & claim damages.
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- In Fiduciary Position:
- Disclose the facts to the company.
- Does not remain the profit made.
- Rules of agency applies.
- Company Can:
- Rescind the contract.
- Retain the property & pay no more.
- Sue him for misfeasance damages, market value – contract price.
6. Liabilities of Promoters:
Non- Compliance of the provisions relating to prospect.
- Guilty of fraud or misfeasance.
- Criminal liability for untrue statement in prospectus.
- Untrue statement in the prospectus.
- Suspend the promoter for 5 yrs.
- Public examination by the court.
- Breach of duty for misapply the company’s property
- Offense on promotion, formation or management of the company.
Remedies to the Subscriber:
- Take proceedings and get repayment of money with interest.
- Untrue statement action against director, promoters for recovery.
- Damages for failure to disclose.
- Liability to the person who authorized the issue of prospectus.
Alteration of Articles of Association:
By special resolution alter its articles and will be valid originally contained in the articles.
- Public to private cannot be done without approval.
Conditions:
- Must not be inconsistent with the provisions of companies act.
- Articles should not be illegal or opposed to public policy.
- Cannot be competed an existing members to take more shares.
- Cannot exceed the power of man.
- Cannot defeat escape from the contractual obligation.
- Cannot give retrospective effect.
- Must not be inconsistent with the court order.
- Must be bonafide for the benefit of the company as whole.
- Must not constitute a fraud on the minority should not favor.
Effect of Alteration:
- Bind members as original.
Distinction:
- Charter of the company – internal rules & regulation.
- Cg permission to alter the moa as per act – special resolution can be altered no cl approval.
We hope you will get a clear idea on your own private limited company registration. This is some step by step procedure of company registration in Coimbatore.
