LegalEdge After College Classroom Handout

PRACTICE SHEET

COMPANIES ACT
1. Identify the correct statements with reference to The Companies (Amendment) Bill, 2020.
1. The Companies (Amendment) Bill, 2020 was introduced in Rajya Sabha by the Minister for Corporate Affairs,
Ms. Nirmala Sitharaman, on March 17, 2020.
2. The Bill seeks to amend the Companies Act, 2013.
3. It has provisions/try to amend provisions related to benches of NCLAT, Corporate Social Responsibility

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(CSR), Remuneration to non-executive directors, etc
(a) 1 and 2 only (b) 1 and 3 only (c) 2 and 3 only (d) 3 only
2. Chapter III of the Companies Act 2013 consists which of the following sections?
(a) Section 21 to 40 (b) Section 23 to 42 (c) Section 25 to 44

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(d) Section 27 to 46

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3. Section 418A says the powers of the Appellate Tribunal may be exercised by the Benches thereof to be
constituted by the Chairperson: Provided that a Bench of the Appellate Tribunal shall have ________.
(a) at least one Judicial Member
(b) at least one Technical Member

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(c) at least one Judicial Member and one Technical Member
(d) at least one Judicial Member and two Technical Member
4.

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As per Section 143 (15) of the Companies Act 2013, If any auditor, cost accountant or company secretary in

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practice does not comply with the provisions of sub-section (12), he shall be liable to a penalty of ………….in case
of a listed company.

5.
(a) five lakh rupees

To
(c) maximum five lakh rupees
(b) one lakh rupees
(d) minimum one lakh rupees
As per Section 172 of the Companies Act 2013, if a company contravenes any of the provisions of this Chapter
and for which no specific punishment is provided therein, the company and every officer of the company who is
in default shall be punishable with fine of ____ rupees and in case of continuing failure, with a further penalty of
_____ rupees for each day during which such failure continues
(a) ten thousand, one lakh (b) five thousand, one lakh
(c) fifty thousand, five hundred (d) fifty thousand, one thousand
6. Power of limited company to alter its share capital is mentioned in which section of the Companies Act, 2013?
(a) Section 55 (b)tr-Section
5M3S2T7N577R3N2T (c) Section 59 (d) Section 61
7. As per Section 24 of the Companies Act, 2013, the Power of Securities and Exchange Board (SEBI) is related to
which of the following matters?
1. Prospectus
2. Return of allotment
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3. Redemption of preference shares tr-5M3S2T7N7R
4. Issue and transfer of securities
5. Non-payment of dividend
(a) 1, 2 only (b) 2, 3 only (c) 4, 5 only (d) 3, 4, 5 only
8. As per Section 139 (1) of the Companies Act 2013, every company shall, at the first annual general meeting,
appoint an individual or a firm as an auditor who shall hold office from the conclusion of that meeting till the
conclusion
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2Bits _____ annual general meeting and thereafter till the conclusion of every ____ meeting.
(a) third, third (b) fourth, fourth (c) sixth, sixth (d) third, sixth

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9. As per Section 182 of the Companies Act 2013, a company which has been in existence for less than ____ financial
years, may contribute any amount directly or indirectly to any political party.
(a) two (b) three (c) five (d) seven
10. Identify the incorrect pair of Section of Companies Act 2013 and corresponding provision.
(a) Section 33: Issue of application forms for securities
(b) Section 34: Criminal liability for misstatements in prospectus.
(c) Section 35: Civil liability for misstatements in prospectus.
(d) All are correct
11. Who is the current chairman of NCLAT?
(a) Justic AM Khanwilkar (b) Justice Ajay Bhushan
(c) Justice Gogoi (d) Justice Ashok Bhushan
12. Which of the following sections of the Companies Act, 2013 requires disclosure in the prospectus of names and

13.
addresses of CFO about sources of promoters contribution among other thing?
(a) Section 37 (b) Section 39 (c) Section 26 (d) Section 40

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According to Section 56 of Companies Act, 2013, the Shares of other interests of any member in a company shall
be:
(a) Movable property
(c) Permanent Property
(b) Immovable property
(d) Tangible property

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14. Singer India Lt(d) v. Chander Mohan Chanda is related with: -
(a) Amalgamation of companies (b) Evasion of Taxes

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(c) Lifting of Corporate veil (d) All the above
15.

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In which of the following case, it was held that the company is not a citizen?

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(a) State Trading Corporation of India v. Commercial Tax Officer

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(b) Tata Engineering Company v. State of Bihar
(c) Benett Coleman & Co. v. Union of India

16.
(d) All the above

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According to the Companies Act, 2013, what are the various kinds of Companies?
(a) Private Companies
(c) Public Companies
(b) One Person Company
(d) All the above
17. According to the Companies Act, 2013, what are the attributes of companies regarding liability?
(a) Companies limited by shares (b) Unlimited Companies
(c) Companies limited by guarantee (d) All the above
18. A Government Company is one in which not less than by the Govt. of the paid-up share capital is held
(a) 51% (b) 55% 7N7R3N2T (c) 90% (d) 99%
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19. Companies divide their object clauses into
(a) Main object (b) Other object
(c) State to which objects extends (d) All above
20. Government Companies Audit and Report is required to be placed before the
(a) Parliament (b) State legislature tr-5M3S
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21. Which of the following is not a characteristic of a company?
(a) Natural Person (b) Separate Legal Entity
(c) Common Seal (d) None of the above
22. Whether a company is considered a citizen?
(a) Yes (b) No
(c)
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23. Given below are two statements: one is labelled as Assertion A, and the other is labelled as Reason R.
Assertion A: The Articles of Association of a company may restrict the right of shareholders to petition for the
winding up of a company.
Reason R: In case of a conflict between the Companies Act, 2013 and the articles of Association, the Act will
prevail.
In the light of the above statements, choose the correct answer from the options given below:
(a) Both A and R are correct and R. is the correct explanation of A
(b) Both A and R are correct but R is not the correct explanation of A
(c) A is correct but R is not correct
(d) A is not correct but R is correct
24. First Board meeting of a company should be held within _______________as per the Companies Act
(a) Thirteen days of the date of its incorporation (b) Thirty days of the date of its incorporation
(c) Forty-five days of the date of its incorporation (d) Thirty-five days of the date of its incorporation
25. How many members are required to form a public company?
(a) Two or more person
(c) Seven or more person
(b) Five or more person
(d) six or more person

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26.
(a) Exceed rupees two crores and rupees ten crores
(b) Exceed rupees four crores and rupees forty crores

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A small company is a company whose paid-up capital and turn over shall________________

(c) Not exceed rupees four crores and rupees forty crores
(d) Not exceed rupees two crores and rupees twenty crores

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27.

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‘Banking company’ Defined under section 2(9) of the Companies Act,2013 means; -
(a) Company as defined in clause (c) of section 5 of the Banking Regulation Act, 1949
(b) Company as defined in clause (3) of section 5 of the Banking Regulation Act, 1949

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(c) Company as defined in clause (e) of section 5 of the Banking Regulation Act, 1949
(d) Company as defined in clause (5) of section 5 of the Banking Regulation Act, 1949
28.

29.
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The Advertisement of a Prospectus of a company shall specify therein:
(a) Object Clause

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(c) Amount of share capital of the company
(b) Liability Clause
(d) Content of Memorandum of Association
Which of the following prospectus is filed with the registrar at the stage of the first offer of securities included
therein, which shall indicate a period not exceeding one year as the validity period of such prospectus?
(a) Red Herring Prospectus (b) Deemed Prospectus
(c) Abridged Prospectus (d) Shelf Prospectus
30. What is the penalty prescribed if the corporation fails to comply with the provision of section 33 of the
Companies Act,2013? 3N2T
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(a) Penalty of one lakh for each default (b) Penalty of twenty-five thousand for each default
(c) Penalty of fifty thousand for each default (d) Penalty of two lakh twenty-five thousand for each default
31. A company that has been in existence for __________________ cannot contribute any amount directly or indirectly to
any political party.
(a) Less than three financial years (b)
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(c) More than three financial years (d) Less than six financial years
32. What is the composition of the Nomination and Remuneration Committee and Stakeholders Relationship
Committee s provided under the Companies Act?
(a) Three or more non-executive directors
(b) Two or more non-executive directors
(c) Four 3C
or more non-executive directors out of which not less than one-half shall be independent director
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(d) Three or more non-executive directors out of which not less than one-half shall be independent director `

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33. Given below are two statements
Statement I: Notice for a meeting must be given to every member of a company in writing 21 days before of the
meeting.
Statement II: Notice shall be deemed to be received at the expiration of 48 hours from the time of posting
In the light of the above statements, choose the correct answer from the options given below:
(a) Both Statement I and Statement II are true (b) Both Statement I and Statement II are false
(c) Statement I is true but Statement II is false (d) Statement I is false but Statement II is true
34. What is the appellate authority for the order against National Company Law Appellate Tribunal?
(a) District Court (b) High Court (c) Supreme Court (d) Company Board Committee
35. In which of the following cases, the doctrine of Indoor Management was laid down?
(a) Solmon v. Solomon & Co. Ltd
(b) Ashbury Railway Carriage and Iron Co. Ltd V Riche (ultra vires doctrine)
(c) Royal British Bank v. Turquand

36.
(d) Foss v. Harbottle

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The Central Government has been empowered to conduct investigation into the affairs of the company under

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section 210 of Companies Act 2013
i. On the report of Registrar of Companies

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ii. In public interest
iii. On passing of the special resolution
iv. On order of the court or tribunal
Select the correct answer:

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(a) i and ii only (b) iii and iv only (c) ii and iii only (d) All i, ii, iii and iv
37.

38.
(b) Section 5

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Which of the following sections deals with ‘Entrenchment’?
(a) Section 4

r (c) Section 6 (d) Section 7

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I. when a declaration is filed by a director within 270 days of the date of incorporation of the company with the

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Registrar that every subscriber to the memorandum has paid the value of the shares agreed to be taken by
him on the date of making of such declaration
II. the company has filed with the Registrar a verification of its registered office as provided in section 12 (2).
III. Where no declaration has been filed and the Registrar has reasonable cause to believe that the company is
not carrying on any business or operations, he may initiate action for the removal of the name of the
company from the register of companies.
(a) i and ii (b) only I (c) ii and iii (d) all of the above
39. Given below are two statements:
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Statement I: Every listed company with
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paid-up capital of Rs. 10,00,00,000/- (ten crores’ rupees) or more must
appoint key managerial personnel.
Statement II: A person may act as key managerial personnel in more than one listed company but the number
must not exceed five companies.
In the light of the above statements, choose the correct answer from the options given below:
(a) Both Statement I and Statement II are truetr-5M3S (b) Both
2T7N Statement
7R3N 2T I and Statement II are false
(c) Statement I is true but Statement II is fake (d) Statement I is false but Statement II is true
40. Chapter III of the Companies Act 2013 is related to______.
(a) Incorporation of Company (b) Prospectus and Allotment of Securities
(c) Acceptance of Deposits by Companies (d) Share Capital and Debentures

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41. A corporate resolution is not an offer unless efforts are made to communicate it. In which it was held?
(a) Blair v. Western Mutual Benefit Association
(b) R. v. Dawood
(c) Harvela Investment Ltv. Royal Trust Co. of Canada
(d) None above
42. What is the appellate authority for the order against the Appellate Tribunal?
(a) High Court (b) District Court (c) None of the above (d) Supreme Court
43. Whether the share-holder becomes the owner of bonus shares from the date of resolution in General Meeting or
from the date on which certificates are issued?
(a) Date of resolution (b) Date of certificate issued
(c) Date of certificate received (d) All above
44. What are the exceptions to the Rule in Foss v. Harbottle?

45.
(a) Fraud on Minority
(c) Acts requiring special resolutions
(b) Ultra vires acts
(d) All the above
Which provision of the Companies Act, 2013 provides for the prevention of oppression?

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46.
(a) Section 200 (b) Section 241 (c) Section 190
Section 253 of the Companies Act, 2013 deals with
(a) Liability of Directors (b) Determination of sickness

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(d) Section 241A

47.
(c) Promoters (d) Memorandum

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Who among the following is authorised to issue regulations regarding shelf prospectus:

48.
(a) SEBI
(c) Company law Board

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(c) Consolidate and define
p (b) Consolidate, define and amend
(d) It is an Act to define and amend

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49. A person cannot a director in more than public companies at a time
(b) 25 Companies (a) 20 Companies (d) 50 Companies (c) 10 Companies
50. Which of the following documents contain object of the company?
(a) The memorandum of association (b) The article of association
(c) Prospectus of the company (d) Share of the company

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