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प्रश्न
Study the following case/situation and express your opinion.
Mr. A entered into a contract with Star Limited company and as advance payment gave a cheque of ₹ 1 lac to a Director Mr. Sam. Mr. Sam is not the Managing Director. Articles state that only the MD is authorized to sign any contracts or receive any payments on behalf of the company.
- Did Mr. Sam have the authority to accept the cheque? Why?
- Can Mr. Sam’s action be called as Ultra Vires? Why?
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उत्तर
- Mr. Sam does not have the authority to accept the cheque from the outside party because Mr. Sam although a director but not a managing director of the company. As per' the provisions made in the articles only managing director has the authority to sign contracts and receive any payment.
- Mr. Sam’s action can be called ultra Vires because accepting a cheque of Rs 1 lac, by a director Mr. Sam, is an act beyond the scope and authority or power of articles of the company.
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संबंधित प्रश्न
Select the correct answer from the option given below and rewrite the sentence.
_______is a primary document of the company which contains the aims and objectives of the company.
Select the correct answer from the option given below and rewrite the sentence.
_________ acts are void or legally ineffective.
Select the correct answer from the option given below and rewrite the sentence.
_______ is an incomplete prospectus.
Match the pairs:
| Group ‘A’ | Group ‘B’ |
| a) Capital clause | 1. Details of capital structure of a company |
| b) Liability clause | 2. Used for multiple issue of shares |
| c) Acts beyond the powers of Memorandum | 3. Abridged Prospectus |
| d) Red Herring Prospectus | 4. Describes main objectives |
| e) Shelf Prospectus | 5. Used for Rights Issue |
| 6. Incomplete Prospectus | |
| 7. Ultra Vires | |
| 8. Doctrine of Indoor management | |
| 9. Extent of liability of members | |
| 10. Articles of Association |
Write a word or a term or a phrase which can substitute the following statement:
Primary document of a company which states aims and objectives of a company.
Write a word or a term or a phrase which can substitute the following statement:
Document which establishes relationship between a company and its members.
Write a word or a term or a phrase which can substitute the following statement:
Prospectus attached with every share application form.
State whether the following statement is True or False:
Articles of Association is subordinate to Memorandum.
State whether the following statement is True or False:
Prospectus can be issued by a private company.
State whether the following statement is True or False:
Red Herring prospectus does not contain details of the price at which shares will be sold by the company.
Find the odd one.
Complete the sentence.
The document which is subordinate to the Memorandum of Association is called _________
Complete the sentence.
The document issued by a company to invite investors to buy its securities is called as _________
Select the correct option from the given options:
| Group A | Group B |
| ___________ | Memorandum of association. |
Explain the following term/concept.
objective clause
Explain the following term/concept.
Liability clauses
Explain the following term/concept.
Capital clauses
Study the following case/situation and express your opinion:
The Articles of a company stated that while borrowing any money from outsiders. The document must have the signatures of the Managing Director (MD) and any one of the directors. The Articles of Association clearly stated the procedure to be followed while borrowing money. The Managing Director did not follow all the procedures but still borrowed money from Mr. X. Mr. X assumed that the MD has followed the required procedures:
(a) Can the MD be held punishable for his act?
(b) Under which Doctrine can Mr. X take action against the company?
(c) Explain the Doctrine.
Study the following case/situation and express your opinion:
The object clause of Memorandum of a company stated the main object as the manufacturing of plastic chairs and tables and any other activity in furtherance of achievement of its main activity. The Board of Directors wants to now also produce TV. Serials and feels that the shareholders may give their permission.
a) Can the company with immediate effect start producing TV? Serials? Why?
b) How can the object clause of the company be altered?
