State, whether the following statements is True or False.A public comp

1.	State, whether the following statements is True or False.A public company can issue shares at only rate of discount.OptionsTrueFalse
Answer» False Explanation: Shares can be issued at a discount by public or private companies, subject to a few conditions (as per Section 79 of Companies Act, 1956) that are mentioned below: ➢ Shares to be issued at a discount must be of an existing class already issued, i.e. a new class of shares cannot be issued at a discount. ➢ Shares issued at a discount must be authorised by the resolution passed in the general meeting of a company and approved by SEBI. ➢ The resolution should specify the maximum rate of discount (not exceeding 10%). ➢ At least one year should have elapsed since the company commenced business. ➢ After the permission of SEBI, the shares to be issued at a discount should be issued within two months.

State, whether the following statements is True or False.A public company can issue shares at only rate of discount.OptionsTrueFalse

Answer»

False

Explanation: Shares can be issued at a discount by public or private companies, subject to a few conditions (as per Section 79 of Companies Act, 1956) that are mentioned below:

➢ Shares to be issued at a discount must be of an existing class already issued, i.e. a new class of shares cannot be issued at a discount.

➢ Shares issued at a discount must be authorised by the resolution passed in the general meeting of a company and approved by SEBI.

➢ The resolution should specify the maximum rate of discount (not exceeding 10%).

➢ At least one year should have elapsed since the company commenced business.

➢ After the permission of SEBI, the shares to be issued at a discount should be issued within two months.

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