Element of Company Law

Multiple Choice Questions 43 Pages

Savitribai Phule Pune University

Bachelors in commerce

Contributed by

Prajwal Hallale

DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in

TERM I

Unit 1. Introduction to the New Act & Concept of Companies:

1. The term company is defined under which sec of the Act?
A. Sec 3(1)
B. Sec4 (2)
C. Sec2 (4)
D. Sec1 (3)

2. Property of the company belongs to_______
A. Company
B. Share holders
C. Members
D. Promoters

3. Minimum number of members in case of public company_______
A. 1
B. 2
C. 5
D. 7

4. Minimum number of members in case of private company is
A. 1
B. 2
C. 3
D. 7

5. Maximum no. of members in case of private company is
A. 50
B. 100
C. 150
D. 200

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DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in

6. Maximum no .of members in case of public company is
A. 0
B. unlimited
C. 50
D. 100

7. Transfer of shares in the company is
A. Restricted
B. Freely transferable
C. Prohibited
D. None of these

8. A company is named as govt. company if it is holds ______% of paid up share capital
A. more than 30
B. more than 40
C. more than 50
D. None

9. The companies which are formed under special Act. Those companies are called as
A. Chartered companies
B. Statutory companies
C. Registered companies
D. None of these

10. The companies which are formed under companies Act. 1956. They will be called as
A. Chartered companies
B. Statutory companies
C. Registered companies
D. None of these

11. Can private company go for public issue?
A. Yes
B. No.

12. Can private company accept deposits from the public?
A. Yes
B. No
Page 2
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in

13. Minimum paid up share capital in case of a private company is _______
A. 1 Lakh
B. 2 Lakhs
C. 3 Lakhs
D. 4 Lakhs

14. Minimum paid up share capital in case of a public company is ________
A. 1 Lakh
B. 3 Lakhs
C. 5 Lakhs
D. 7 Lakhs

15. Minimum no. of Directors in case of a public company is __________
A. 1
B. 2
C. 3
D. 4

16. The companies which are formed under special charter granted by the king or queen of
England are called
A. Statutory companies
B. Registered companies
C. Chartered companies
D. None of these

17. The companies which are formed under special Act. Those companies are called as
A. Chartered companies
B. Statutory companies
C. Registered companies
D. None of these

18. The companies which are formed under companies Act. 1956. They will be called as
A. Chartered companies
B. Statutory companies
C. Registered companies
D. None of these
Page 3
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in

19. Under which sec. a private company can voluntarily converted into public company
_______
A. 34
B. 44
C. 54
D. 64

20. Under which sec. a private company can automatically converted into a public company
______
A. 34
B. 43
C. 53
D. 35

21. Central Government permission is required in case of _______ conversion __________
A. Private to public
B. Public to private
C. Both (a) or (b)
D. None of the above

22. Can private company go for public issue?
A. Yes
B. No.

23. Can private company accept deposits from the public?
A. Yes
B. No

24. A company is named as govt. company if it is holds ______% of paid up share capital
A. more than 30
B. more than 40
C. more than 50
D. None

Page 4
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in

25. Which companies are exempted to add “Ltd” or “Pvt Ltd” at the end of their name
A. Private
B. Govt
C. Defunct
D. Association not for profits

26. If XYZ is the holding company of P&R Ltd. then, which of the following
statement is not true in this regard.

A. XYZ Ltd. controls the composition of Board of P&R
B. XYZ Ltd. holds more than 50% of the nominal value of the equity shares
C. Both (a) & (b)
D. None of the above

27. which of the following company/companies are registered by the Companies Act, 2013?

A. Government Company
B. Private Company
C. Public Company
D. All of the above
28. A subsidiary of a government company is also treated as a

A. Government Company
B. Public Company
C. Private Company
D. All of the above

29. Which of the following company is incorporated in a country outside India?

A. Private Company
B. Foreign Companies
C. Government Company
D. None of the above

Page 5
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in

30. Which of the following statement is false?

A. No legal formality is required to form a company.
B. The shareholders of a company have limited liability.
C. A company can own property in its own name.
D. A company is managed by the elected representatives of shareholders.

Answer Key
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
A
A
D
B
D
B
B
C
B
C
B
B
A
C
C
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
C
B
C
B
B
B
B
B
C
D
D
D
A
B
A

Page 6
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in

Unit 2 Formation and Incorporation of a Company

31. If a company which is formed with unlimited liability wants to convert to limited liability
then it should pass
A. Ordinary resolution
B. Special resolution
C. No need

32. Maximum capital of private company is
A. 50 Lakhs
B. 1 Crore
C. 1.5 Crore
D. Unlimited.

33. Transfer of shares in case of private company is
A. Prohibited
B. Restricted
C. Freely transferable
D. None of these

34. Invitation to public offering shares or debentures in case of private company
A. Prohibited
B. Restricted
C. Acceptable
D. None of these

35. How many members should sign the MOA in case of public company ________
A. 1
B. 3
C. 5
D. 7

Page 7
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in
36. How many members should sign the MOA in case of private company ________
A. 1
B. 2
C. 3
D. 4

37. In case of appointment of Directors ______ form is to be filed
A. 29
B. 32
C. 18
D. 1

38. ______ is the conclusive evidence in case of company that statutory requirements have
complied with
A. Certificate of Incorporation
B. Certificate of commencement of Business
C. Both
D. None of the above

39. Private company can start its business immediately after the issue of
A. Certificate of commencement of Business
B. Certificate of Incorporation
C. Both
D. None of the above

40. Public company Should start business only after getting
A. Certificate of Incorporation
B. Commencement of business
C. None of these

41. Private company can start business only after getting certificate of
A. Incorporation
B. Commencement of business
C. None of these

Page 8
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in
42. Which of the following is not a stage of the development of company?

A. Promotion
B. Production
C. Incorporation
D. Commencement of Business

43. A is one who performs the preliminary duties necessary to bring a company into being and
float it.

A. Auditor
B. Promoter
C. Director
D. Financer

44. “One who undertakes to form a company with reference to a given object and set it going and
who takes the necessary steps to accomplish that purpose
A. Promoter
B. Directors
C. C.E.O.
D. Board of Directors

45. Which of the following are the functions of a promoter?

A. Decides name of a company
B. Nomination of directors
C. Settles the details of memorandum and articles
D. All of these

46. The whole process of the company formation may be divided into three direct stages, the
sequence is-
A. (a) Promotion, incorporation by registration, commencement of business.
B. (b) Incorporation by registration, commencement of business, promotion.
C. (c) Commencement of business, promotion, incorporation by registration.
D. (d) Commencement of business, incorporation by registration, promotion.

Page 9
DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, PUNE45

Subject –Element of Company Law (205) Class : SYB.COM (2019 Pattern)

PROF . SWATI BHALERAO www.dacc.edu.in
47. _______stands in the fiduciary position of the company
A. Directors
B. Promoters
C. Auditors
D. None of the above

48. ______ are the contracts entered into by promoters on behalf of a prospectus company.
A. Provisional contracts
B. Pre-Incorporation contracts
C. Preliminary contracts
D. Both a) & b)

49. Contracts made after incorporation but before the grant of Certificate of commencement
Of Business _____
A. Provisional contracts
B. Preincorporation contracts
C. Preliminary contracts
D. Both (b) & (c)

50. Pre-incorporation contract is also known as _________
A. Provisional
B. Preliminary
C. illegal
D. Legal

51. A public company can borrow money ___________
A. before incorporation
B. Soon after incorporation
C. after issuing a proposal
D. after obtaining certificate to commerce business.

52. A private company can borrow funds
A. after incorporation
B. after obtaining certificate to commerce business
C. after holding first annual general meeting
D. None of the above

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Element of Company Law

Element of Company Law

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