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True/False Answer Question: Statement in lieu of prospectus can be filed by a public company going for a public issue.

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Question

True/False Answer Question:

Statement in lieu of prospectus can be filed by a public company going for a public issue.

Options

  • True

  • False

MCQ
True or False
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Solution

The statement is False.
A public limited company inviting applications from the general public to subscribe to its shares or debentures is mandatorily required to file a prospectus with the Registrar of Companies. However, if a company is confident that it can raise funds through private sources i.e. through friends, relatives, or some private arrangements as done by a private company, then it may file a statement in lieu of prospectus with the Registrar of Companies at least three days before making the allotment.

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Formation of a Company
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Chapter 7: Formation of a Company - True or False [Page 179]

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NCERT Business Studies [English] Class 11
Chapter 7 Formation of a Company
True or False | Q 2 | Page 179

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