Counsel
Ask an expert!
Legal, accounting and compliance advice from qualified professionals.
1. Director cannot remove a director. Only Shareholders can remove Directors.
2. There is no time period provided under the CA, 2013 for payment of subscription money by the subscribers to the Company. Therefore, we can say that it is not mandatory to pay share subscription money immediately on the incorporation of Company. Subscription of MOA...
Wazzeer Professional Network
ProfessionalTwo people formed a private limited company stating as stated capital 1lakh and paid-up capital 1 lakh, but one of the directors has not invested to start the company and all the burden lies on the second person. However, the person promised that he will pay and has been prolonging ever since actually waiting for the first business profit to happen and pay from that.
Now the two people are directors with equal responsibilities and have equal shares. The share certificates are not signed by the defaulter. It has been more than 2 years now that the default director has not paid, nor signed the share certificates nor he is willing to transfer the shares to someone willing to take up nor he is paying up the initial capital to start the business, now that the complete company has been formed and he is yet to pay up for the capital the following questions arise. Q1. Can one director of two take-ups out the other director of the company and as a shareholder. If yes, how could he do it? Q2. How do we deal with defaulters in paying the upfront capital to start the company? Q3. How do we deal if the defaulter is misusing by purchasing any materials with the company TIN via interstate to avail the 2% CST benefit instead of 14.5% VAT? Q4. Even if we manage to take him out as a director, how do we deal with removing him as a shareholder?
-
Wazzeer Professional Network
Professional1. Director cannot remove a director. Only Shareholders can remove Directors.
2. There is no time period provided under the CA, 2013 for payment of subscription money by the subscribers to the Company. Therefore, we can say that it is not mandatory to pay share subscription money immediately on the incorporation of Company. Subscription of MOA by the subscriber is a contract b/w the subscriber and the Company. In which Company will issue shares certificates to the subscriber and in consideration of the same subscriber will make payment to the Company. If a company issued share certificates to the subscriber, the company has performed its part. But consideration (money) not received from the subscriber then it will be considered as a breach of Contract by the subscriber and will attract civil dispute for breach of contract.
3. As per section 447, any fraud happens in the Company which is affecting the interest of the Company then he will be penalized according to the section.
4. You have to maintain minimum criteria for 2 director and 2 shareholders so you have appointed one shareholder as well as Director so that compliance of private company can be maintained. Transfer his shares from him and he will be removed from the shareholder.
Wazzeer Professional Network is fully equipped to handle legal matter like this one, to take this discussion further -> "Get your Wazzeer"
about 4 years ago
View answer
Two people formed a private limited company stating as stated capital 1lakh and paid-up capital 1 lakh, but one of the directors has not invested to start the company and all the burden lies on the second person. However, the person promised that he will pay and has been prolonging ever since actually waiting for the first business profit to happen and pay from that.
Now the two people are directors with equal responsibilities and have equal shares. The share certificates are not signed by the defaulter. It has been more than 2 years now that the default director has not paid, nor signed the share certificates nor he is willing to transfer the shares to someone willing to take up nor he is paying up the initial capital to start the business, now that the complete company has been formed and he is yet to pay up for the capital the following questions arise. Q1. Can one director of two take-ups out the other director of the company and as a shareholder. If yes, how could he do it? Q2. How do we deal with defaulters in paying the upfront capital to start the company? Q3. How do we deal if the defaulter is misusing by purchasing any materials with the company TIN via interstate to avail the 2% CST benefit instead of 14.5% VAT? Q4. Even if we manage to take him out as a director, how do we deal with removing him as a shareholder?
-
Wazzeer Professional Network
Professional1. Director cannot remove a director. Only Shareholders can remove Directors.
2. There is no time period provided under the CA, 2013 for payment of subscription money by the subscribers to the Company. Therefore, we can say that it is not mandatory to pay share subscription money immediately on the incorporation of Company. Subscription of MOA by the subscriber is a contract b/w the subscriber and the Company. In which Company will issue shares certificates to the subscriber and in consideration of the same subscriber will make payment to the Company. If a company issued share certificates to the subscriber, the company has performed its part. But consideration (money) not received from the subscriber then it will be considered as a breach of Contract by the subscriber and will attract civil dispute for breach of contract.
3. As per section 447, any fraud happens in the Company which is affecting the interest of the Company then he will be penalized according to the section.
4. You have to maintain minimum criteria for 2 director and 2 shareholders so you have appointed one shareholder as well as Director so that compliance of private company can be maintained. Transfer his shares from him and he will be removed from the shareholder.
Wazzeer Professional Network is fully equipped to handle legal matter like this one, to take this discussion further -> "Get your Wazzeer"
about 4 years ago
Looking to hire a professional from our handpicked community?
Explore our services, submit your request and let us do the rest for you.