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1. |
A company is called an artificial person because |
A. | it does not have the shape of a normal man. |
B. | it cannot be sued in the court of law. |
C. | it is invisible and intangible. |
D. | it exists only in contemplation of law. |
Answer» D. it exists only in contemplation of law. |
2. |
The ‘common seal’ of the company should have |
A. | the company’s name. |
B. | the words ‘corporate seal’. |
C. | the place of the company. |
D. | all the above. |
Answer» D. all the above. |
3. |
Power to use official seal of the company outside India is to be authorized by. |
A. | article of association. |
B. | memorandum of association |
C. | both memorandum and article of association. |
D. | central government. |
Answer» A. article of association. |
4. |
A company comes into legal existence as a person on. |
A. | approval by company law tribunal to commence business. |
B. | approval by central government as being a bonafide company. |
C. | acceptance of legal documents by the registrar for its incorporation. |
D. | issue of certificate of incorporation by the registrar of companies. |
Answer» D. issue of certificate of incorporation by the registrar of companies. |
5. |
The word ‘Limited’ can be dropped from a company’s name only when. |
A. | the company is formed for promotion of commerce, art, science, religion, charity or any other useful object. |
B. | the company prohibits the payment of dividends. |
C. | both (a) and (b). |
D. | the central government deems it fit. |
Answer» C. both (a) and (b). |
6. |
A public company can be called as a body corporate after it. |
A. | receives certificate of commencement of business. |
B. | issues prospectus. |
C. | receives certificate of incorporation. |
D. | receives approval from the registrar for the proposed name of the |
Answer» C. receives certificate of incorporation. |
7. |
A registered company is the company which is incorporated. |
A. | under the companies act, 1956. |
B. | by a special notification of the central government. |
C. | under the indian registration act. |
D. | by a special act of parliament or state. |
Answer» A. under the companies act, 1956. |
8. |
The minimum number of members required to form a ‘public Company’ is. |
A. | 2. |
B. | 7 |
C. | 10 |
D. | 50 |
Answer» B. 7 |
9. |
The minimum and maximum number of members in a private company are. |
A. | 7 and 50. |
B. | 2 and 50. |
C. | 3 and 100. |
D. | 2 and unlimited. |
Answer» B. 2 and 50. |
10. |
Converting a public company into a private company requires a special resolution. |
A. | passed by the members and with sanction of the central government. |
B. | passed by the members and approved by the registrar of companies. |
C. | passed by the members and approved by the company law tribunal. |
D. | passed by the members and approved by the auditors. |
Answer» A. passed by the members and with sanction of the central government. |
11. |
In which of the following conditions, a company will be reckoned a foreign company? |
A. | if the company is established outside india and has a place- of business in india. |
B. | a company incorporated outside india having shareholders who are all indian citizens and having its business outside india. |
C. | a company incorporated in india but having all foreign shareholders. |
D. | both (a) and (b). |
Answer» A. if the company is established outside india and has a place- of business in india. |
12. |
Legal position of a promoter of a company is. |
A. | that of an agent. |
B. | that of a trustee. |
C. | that of a solicitor. |
D. | in a fiduciary capacity. |
Answer» D. in a fiduciary capacity. |
13. |
A company is said to have been registered when? |
A. | it files memorandum of association and articles of association. |
B. | it gets incorporation certificate with the registrar of companies. |
C. | it gets certificate for commencement of business. |
D. | it actually starts its business. |
Answer» B. it gets incorporation certificate with the registrar of companies. |
14. |
A private Limited company commences business. |
A. | at any time. |
B. | after obtaining the certificate of incorporation. |
C. | after obtaining the certificate to commence business. |
D. | none of the above. |
Answer» B. after obtaining the certificate of incorporation. |
15. |
Certificate of commencement of business is not required by. |
A. | a public company. |
B. | a private company. |
C. | both public and private companies. |
D. | private company subsidiary to a public company. |
Answer» B. a private company. |
16. |
The companies (Amendment) Act , 2000 provides new section 292 A for constitution of audit committees by every public company having a paid- up capital of. |
A. | rs.10 lakh or more. |
B. | rs. 50 lakh or more. |
C. | rs.1 crore or more. |
D. | rs.50 million or more. |
Answer» D. rs.50 million or more. |
17. |
An Audit Committee may include. |
A. | auditors. |
B. | company secretary. |
C. | non- executive directors. |
D. | all. |
Answer» D. all. |
18. |
Which of the following reports included clause 49 in the listing agreement. |
A. | sabhanayagam report. |
B. | kumaramangalam birla report. |
C. | narasimham report. |
D. | l.c. gupta report. |
Answer» B. kumaramangalam birla report. |
19. |
Audit committee shall act in accordance with the terms of reference to be specified by. |
A. | statutory auditors. |
B. | sebi. |
C. | board of directors. |
D. | central government. |
Answer» C. board of directors. |
20. |
The Statutory Auditors of the company are appointed by. |
A. | share holders in annual general meeting. |
B. | board of directors. |
C. | company law boa |
Answer» A. share holders in annual general meeting. |
21. |
Remuneration Committee is made up of. |
A. | independent directors. |
B. | executive directors. |
C. | auditors. |
D. | investors. |
Answer» A. independent directors. |
22. |
Executive Directors are those directors who. |
A. | are men from outside the board. |
B. | occupy management position. |
C. | are independent directors. |
D. | elect the board committee. |
Answer» B. occupy management position. |
23. |
The company agrees that the remuneration of non- executive directors shall be decided by. |
A. | board of directors. |
B. | company. |
C. | share holders. |
D. | central government. |
Answer» A. board of directors. |
24. |
An Article constitutes a contract between. |
A. | the company and its members. |
B. | the members and outsiders. |
C. | the company and the outsider. |
D. | all the above. |
Answer» A. the company and its members. |
25. |
Name of a company can be changed by. |
A. | an ordinary resolution. |
B. | a special resolution. |
C. | an approval of the central government. |
D. | a special resolution and with approval of the central government. |
Answer» D. a special resolution and with approval of the central government. |
26. |
Change of registered office of a company from one place to another in the same city requires. |
A. | board resolution. |
B. | special resolution. |
C. | ordinary resolution. |
D. | special resolution with central government approval. |
Answer» A. board resolution. |
27. |
Article of Association can be altered by. |
A. | a resolution of board of directors. |
B. | an ordinary resolution in annual general meeting by the shareholders. |
C. | a special resolution. |
D. | obtaining permission of the company law tribunal. |
Answer» C. a special resolution. |
28. |
A change in the registered office of the company from one state to another can be effected by. |
A. | a resolution of the board of directors. |
B. | a resolution passed in the general meeting of the company. |
C. | a special resolution of the company and approval of the central government. |
D. | a special resolution and confirmation of the company law tribunal. |
Answer» D. a special resolution and confirmation of the company law tribunal. |
29. |
The charter of a company is its. |
A. | prospectus. |
B. | memorandum of association. |
C. | certificate of incorporation. |
D. | articles of association. |
Answer» B. memorandum of association. |
30. |
A document which lays down the fundamental conditions upon which the company is allowed to form is called. |
A. | memorandum of association. |
B. | article of association. |
C. | prospects. |
D. | certificate of incorporation. |
Answer» A. memorandum of association. |
31. |
The alteration of the Memorandum has to be certified by the Registrar. |
A. | within 45 days. |
B. | within 15 days. |
C. | at his own time provided the company satisfies his queries in this respect. |
D. | within 30 days. |
Answer» D. within 30 days. |
32. |
Memorandum of Association does not include. |
A. | subscription clause. |
B. | capital clause. |
C. | liability clause. |
D. | assets clause. |
Answer» D. assets clause. |
33. |
‘Shelf prospectus’ means a prospectus issued by. |
A. | any trading company. |
B. | any industrial company. |
C. | any financial institution or banks. |
D. | any existing company whose shares are listed on a recognized stock exchange. |
Answer» C. any financial institution or banks. |
34. |
The ‘Golden Rule’ for framing of a prospectus was laid down in the case of. |
A. | royal british bank. |
B. | rex vs kylsant. |
C. | new brunswick & canada rly. & land co. vs muggeridge. |
D. | derry vs peek. |
Answer» C. new brunswick & canada rly. & land co. vs muggeridge. |
35. |
The document which invites the public for subscribing capital in the form of shares and debenture is called. |
A. | memorandum of association. |
B. | article of association. |
C. | prospectus. |
D. | legal announcement. |
Answer» C. prospectus. |
36. |
Which of the documents is not filed to the registrar at the time of incorporation? |
A. | memorandum. |
B. | article of association. |
C. | consent of the director. |
D. | prospectus. |
Answer» D. prospectus. |
37. |
A prospectus may contain a statement purporting to be made by an expert. The term “expert” includes. |
A. | an engineer. |
B. | a valuer. |
C. | an accountant and any other person whose profession gives authority to a statement made by him. |
D. | all the above. |
Answer» D. all the above. |
38. |
The most important clause in the Memorandum of Association of a company is. |
A. | name clause. |
B. | registered office clause. |
C. | objects clause. |
D. | liability clause. |
Answer» C. objects clause. |
39. |
Who has certain remedies for misstatement in the prospectus against the company and the persons issuing the Prospectus? |
A. | a person who has applied for shares in the company and who has been allotted shares. |
B. | a buyer of shares in the open market. |
C. | a subscriber to the memorandum. |
D. | all the above. |
Answer» A. a person who has applied for shares in the company and who has been allotted shares. |
40. |
The prospectus must be issued within ………………… after the date on which a copy thereof has been delivered for registration. |
A. | 30 days. |
B. | 60 days. |
C. | 90 days. |
D. | 120 days |
Answer» C. 90 days. |
41. |
Every prospectus |
A. | has to be dated. |
B. | need not be dated as per the provisions of law. |
C. | can be dated depending upon the requirements of the boa |
Answer» A. has to be dated. |
42. |
The exception to the doctrine of constructive notice is provided in |
A. | lifting the corporate veil. |
B. | doctrine of ultra vires. |
C. | doctrine of indoor management. |
D. | none of the above. |
Answer» C. doctrine of indoor management. |
43. |
Any document filed with the registrar will be deemed to have been read and understood by all those who deal with the company. It is as per the doctrine of. |
A. | constructive notice. |
B. | indoor management. |
C. | public notice. |
D. | ultra vires. |
Answer» A. constructive notice. |
44. |
The Doctrine of indoor management provides protection to. |
A. | the board of directors. |
B. | the shareholders. |
C. | the managing directors. |
D. | outsiders. |
Answer» D. outsiders. |
45. |
The doctrine of constructive notice protects the interest of. |
A. | the company. |
B. | the shareholders. |
C. | the creditors. |
D. | the debtors. |
Answer» A. the company. |
46. |
When an act is performed or a transaction is carried out, which though legal in itself, is not authorized by the objects clause in the Memorandum or by Statute, it is said to be. |
A. | ultra vires the powers of the company. |
B. | intra vires the powers of the company. |
C. | ultra vires the powers of the company. |
D. | ultra vires the implied authority. |
Answer» A. ultra vires the powers of the company. |
47. |
An act of a director which is intra vires the Memorandum and ultra vires the Articles of Association. |
A. | cannot be ratified by the company. |
B. | must necessarily be ratified by the company. |
C. | may be ratified by the company. |
D. | is void ab inito. |
Answer» C. may be ratified by the company. |
48. |
Doctrine of constructive notice is related to. |
A. | memorandum of association. |
B. | articles of association. |
C. | memorandum of association and articles of association both. |
D. | neither memorandum of association nor articles of association. |
Answer» C. memorandum of association and articles of association both. |
49. |
A person is disqualified from being appointed as a director of a company if. |
A. | he has applied to be adjudged insolvent. |
B. | he is of unsound mind. |
C. | he is an undischarged insolvent. |
D. | all the above. |
Answer» D. all the above. |
50. |
A person cannot be a director of more than …………… as per the Companies (Amendment) Act, 2000. |
A. | 5 companies. |
B. | 10 companies. |
C. | 15 companies. |
D. | 20 companies. |
Answer» C. 15 companies. |
51. |
The remuneration payable to a whole time director of the company should not exceed. |
A. | 5% of the net profits. |
B. | 6 % of the net profits. |
C. | 7 % of the net profits. |
D. | 10% of the net profits. |
Answer» A. 5% of the net profits. |
52. |
The first directors of a public company are appointed by the. |
A. | public. |
B. | shareholders. |
C. | promoters. |
D. | government. |
Answer» C. promoters. |
53. |
According to the companies Act, 1956 a Private limited company must have at least ………… directors. |
A. | seven. |
B. | three. |
C. | two. |
D. | one. |
Answer» C. two. |
54. |
Maximum managerial remuneration permissible under the Companies Act, 1956 for public limited companies is. |
A. | 10% of the net profits. |
B. | 5% of net profit. |
C. | 11% of net profit. |
D. | 8% of net profit. |
Answer» C. 11% of net profit. |
55. |
Under the companies Act, which one of the following powers can be exercised by the Board of Directors? |
A. | power to sell the company’s undertakings. |
B. | power to make call. |
C. | power to borrow money in excess of the paid up capital. |
D. | power to reappoint an auditor. |
Answer» B. power to make call. |
56. |
Who may be appointed as a director of a company? |
A. | an individual. |
B. | a body corporate. |
C. | a firm. |
D. | an association. |
Answer» A. an individual. |
57. |
The nominal value of the qualification shares of a director must not exceed. |
A. | rs. 1000 |
B. | rs.2000. |
C. | rs.4000. |
D. | rs. 5000 or the nominal value of one share where it exceeds rs.5000. |
Answer» D. rs. 5000 or the nominal value of one share where it exceeds rs.5000. |
58. |
According to section 255 of the companies Act, the Directors must be appointed by the. |
A. | central government. |
B. | company law tribunal. |
C. | company in general meeting. |
D. | board of directors. |
Answer» C. company in general meeting. |
59. |
The Board of Directors can exercise the power to appoint directors in the case of. |
A. | additional directors. |
B. | filling up the casual vacancy. |
C. | alternate directors. |
D. | all the above. |
Answer» D. all the above. |
60. |
Where a director acts dishonestly to the interest of the company, he will be held liable for. |
A. | ultra vires acts. |
B. | negligence. |
C. | breach of fiduciary duty. |
D. | mala fide acts. |
Answer» C. breach of fiduciary duty. |
61. |
Except with the approval of the central Government, remuneration of a whole time director or a managing director shall not exceed …………… of the net profits for one such director. |
A. | 3%. |
B. | 5%. |
C. | 10%. |
D. | 11%. |
Answer» C. 10%. |
62. |
Under section 269, every public company and a private company which is a subsidiary of a public company must have a managing director or a whole time director if its paid-up share capital is. |
A. | rs.1 crore or more. |
B. | rs.2 crore or more. |
C. | rs.5 crore or more. |
D. | rs.10 crore or more. |
Answer» C. rs.5 crore or more. |
63. |
Sec.291 of the Company Act 1956, has clarified that. |
A. | the directors are subordinate to the overall majority of the shareholders. |
B. | the board of directors shall exercise all such powers and do all such acts as the company is authorized to exercise or to do subject to the restrictions contained in the act, memorandum and articles. |
C. | the shareholders cannot interfere with the conduct of management in any way. |
D. | all the above. |
Answer» B. the board of directors shall exercise all such powers and do all such acts as the company is authorized to exercise or to do subject to the restrictions contained in the act, memorandum and articles. |
64. |
When the Directors have acted mala fide and are themselves the wrong doers, the only option left with the shareholders is. |
A. | to go to the court. |
B. | approach the company law tribunal. |
C. | to interfere in management by a majority in the general meeting. |
D. | to approach the central government. |
Answer» C. to interfere in management by a majority in the general meeting. |
65. |
When there is a deadlock between the directors. |
A. | the central government can intervene and ask the directors to co-operate with each other. |
B. | the company law tribunal has necessarily to intervene. |
C. | shareholders may intervene to take necessary steps to ensure the working of the company. |
D. | directors must forget about personnel issues and work for greater good. |
Answer» C. shareholders may intervene to take necessary steps to ensure the working of the company. |
66. |
What is the amount of contribution that a company can make for political purposes? |
A. | 10% of net profits of the preceding financial year on which the tax has been paid. |
B. | 5% of gross profit of the current assessment year. |
C. | amount not exceeding 5% of the net profits of three immediately preceding financial years. |
D. | none of these. |
Answer» C. amount not exceeding 5% of the net profits of three immediately preceding financial years. |
67. |
Any information or knowledge generated by the company. |
A. | is the property of the company and known as intellectual property. |
B. | cannot be used by any director for personal gains. |
C. | if used for personal gains by any director must be accounted for to the company. |
D. | all the above. |
Answer» D. all the above. |
68. |
According to section 283 (1) (g) if a director absents himself from 3 consecutive board meetings or from all meetings consecutively for a period of 3 months without obtaining leave of absence. |
A. | he shall be fined with rs.500. |
B. | he shall be held accountable to the registrar. |
C. | his office shall become vacant. |
D. | all the above. |
Answer» C. his office shall become vacant. |
69. |
The maxim “delegates nonpotest delegare” states the. |
A. | duty to delegate to a director. |
B. | duty not to delegate their duties. |
C. | duty of a subordinate not to protest when duty has been delegated to him. |
D. | none of above. |
Answer» B. duty not to delegate their duties. |
70. |
A company can be wound up. |
A. | voluntarily by members. |
B. | by the order of the tribunal. |
C. | by voluntary winding up by creditors. |
D. | by all the above methods. |
Answer» D. by all the above methods. |
71. |
Compulsory winding up means winding up. |
A. | by the tribunal. |
B. | by the members. |
C. | by the creditors. |
D. | all of them. |
Answer» A. by the tribunal. |
72. |
A company may be wound up by the Tribunal if. |
A. | the company passes an ordinary resolution to this effect. |
B. | the company does not commence its business within 6 months of its incorporation. |
C. | number of members reduced below 7 in the case of a private company. |
D. | company is unable to pay its debts. |
Answer» D. company is unable to pay its debts. |
73. |
As per Sec 439, who can file a petition to the tribunal for winding up? |
A. | the registrar. |
B. | company. |
C. | contributory. |
D. | any one of these. |
Answer» D. any one of these. |
74. |
As per Sec.444 when the Tribunal makes an order for the winding up it should be communicated within two weeks to. |
A. | official liquidator. |
B. | company. |
C. | central government. |
D. | national company law board. |
Answer» A. official liquidator. |
75. |
Official liquidators are appointed from a panel of. |
A. | professional firms of chartered accountants. |
B. | advocates. |
C. | company secretaries. |
D. | all. |
Answer» D. all. |
76. |
Tribunal may appoint the official liquidator to be the liquidator provisionally at any time. |
A. | after the presentation of petition for winding up. |
B. | after making the winding up order. |
C. | after dissolution. |
D. | before the statutory meeting. |
Answer» A. after the presentation of petition for winding up. |
77. |
The official liquidator after receipt of statement of affairs of the company must submit a preliminary report to the Tribunal not later than ……………. of the order. |
A. | 6 month. |
B. | one year. |
C. | two weeks. |
D. | one month. |
Answer» A. 6 month. |
78. |
On a winding up order being made, the company’s property comes under the custody of. |
A. | liquidator. |
B. | tribunal. |
C. | central government. |
D. | share holders. |
Answer» A. liquidator. |
79. |
As per Sec.457, the statutory powers of the liquidator can be exercised. |
A. | with the sanction of tribunal. |
B. | without the sanction of the tribunal. |
C. | some with and some without such sanction. |
D. | with the sanction of the central government. |
Answer» C. some with and some without such sanction. |
80. |
In the event of Company being wound up the Tribunal shall prepare list of contributories into. |
A. | list a. |
B. | list b. |
C. | list a and list b. |
D. | list a or list b. |
Answer» C. list a and list b. |
81. |
One of the following is the instance where the just and equitable clause for winding up can be adopted by the Tribunal. |
A. | oppression of minority by the majority. |
B. | inability to pay debts. |
C. | commercial insolvency. |
D. | reduction of members below minimum. |
Answer» A. oppression of minority by the majority. |
82. |
As per Sec.488, Declaration of Solvency of company by the Directors in the case of voluntary winding up may be made within. |
A. | 5 weeks of passing resolution. |
B. | one month. |
C. | 6 months. |
D. | none of these. |
Answer» A. 5 weeks of passing resolution. |
83. |
The object of winding up of a company by the Tribunal is. |
A. | to facilitate the protection of its assets. |
B. | to convert the company into private company if it is a public company. |
C. | to convert the company into public company if it is a private company. |
D. | to change the memorandum and articles. |
Answer» A. to facilitate the protection of its assets. |
84. |
A voluntary winding up means winding up by. |
A. | members or creditors. |
B. | members or contributors. |
C. | contributories or creditors. |
D. | share holders or tribunal. |
Answer» A. members or creditors. |
85. |
Statutory meeting of the company must be held within. |
A. | one month of obtaining the certificate to commence business. |
B. | 3 months of obtaining the certificate to commence business. |
C. | 6 months of obtaining the certificate of incorporation. |
D. | 6 months of obtaining the certificate to commence business. |
Answer» D. 6 months of obtaining the certificate to commence business. |
86. |
Notice of the statutory meeting to all the members of the company is required to be sent at least. |
A. | 14 days before the date of meeting. |
B. | 21 days before the date of the meeting. |
C. | 25 days before the date of the meeting. |
D. | 30 days before the date of the meeting. |
Answer» B. 21 days before the date of the meeting. |
87. |
Statutory meeting of the company is held. |
A. | every year. |
B. | after every two years. |
C. | once in the life time of the company. |
D. | every year at the discretion of the board of directors. |
Answer» C. once in the life time of the company. |
88. |
Statutory meeting is not to be held if a new company is a . |
A. | public limited company. |
B. | government company. |
C. | private company (limit) |
D. | fera company. |
Answer» C. private company (limit) |
89. |
The first annual general meeting of the company must be held within. |
A. | 12 months from the date of incorporation. |
B. | 12 months from the date of commencement of business. |
C. | 18 months from the date of its incorporation. |
D. | 18 months from the date of commencement of business. |
Answer» C. 18 months from the date of its incorporation. |
90. |
The interval between two annual general meetings should not be more than. |
A. | 12 months. |
B. | 15 months. |
C. | 18 months. |
D. | 20 months. |
Answer» B. 15 months. |
91. |
Statutory meeting need to be held by. |
A. | a public company limited by guarantee and having a share capital. |
B. | a public company having liability of its members unlimited. |
C. | a government company. |
D. | a public company not having share capital. |
Answer» A. a public company limited by guarantee and having a share capital. |
92. |
A meeting of the Board of Directors must be held at least once in. |
A. | each month. |
B. | every two months. |
C. | every three months. |
D. | every four months. |
Answer» C. every three months. |
93. |
When can an annual General Meeting be called giving shorter notice than that specified? |
A. | if consent is accorded to by all the members entitled to vote. |
B. | if consent is accorded to by 30% of the members entitled to vote. |
C. | if board of directors takes a majority decision in this rega |
Answer» A. if consent is accorded to by all the members entitled to vote. |
94. |
For general meeting of any kind (statutory, Annual or Extraordinary) at least ………….. Notice must be given to members. |
A. | 21 days. |
B. | 22 days. |
C. | 23 days. |
D. | 25 days. |
Answer» A. 21 days. |
95. |
Quorum for general meeting for private and public companies. |
A. | 2 and 5. |
B. | 3 and 6. |
C. | 5 and 7. |
D. | none of these. |
Answer» A. 2 and 5. |
96. |
Quorum for a Board meeting is. |
A. | 1/3 of total number of directors or 2 directors, whichever is higher. |
B. | ½ of total number of directors or 3 directors whichever is higher. |
C. | ½ of total number of director or 3 directors whichever is lower. |
D. | none of the above. |
Answer» A. 1/3 of total number of directors or 2 directors, whichever is higher. |
97. |
The minutes book can be inspected by the. |
A. | shareholders free of charge. |
B. | debenture holders on payment. |
C. | any one on payment. |
D. | none of the above. |
Answer» A. shareholders free of charge. |
98. |
Minutes of company meeting should be prepared within. |
A. | 21 days of the meeting. |
B. | 30 days of the meeting. |
C. | 40 days of the meeting. |
D. | 45 days of the meeting. |
Answer» B. 30 days of the meeting. |
99. |
A special resolution is passed by. |
A. | simple majority. |
B. | 2/3 majority. |
C. | 3/4 majority. |
D. | none of these. |
Answer» C. 3/4 majority. |
100. |
An ordinary resolution at a general meeting of the shareholders is sufficient for. |
A. | reduction of share capital. |
B. | issue of shares at a discount. |
C. | creation of reserve capital. |
D. | all the above. |
Answer» B. issue of shares at a discount. |
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