“LEGAL ASPECT OF TYPES OF SHARE CAPITAL TO A COMPANY”

ROUGH DRAFT SUBMITTED IN THE PARTIAL FULFILENT OF THE COURSE

TITLED-

PRINCIPES OF ACCOUNTING AND AUDIT

Submitted by: Submitted to:

AMISHA PRAKASH MR. Ashok Kumar Sharma

ROLL NO:2005(2nd Semester)

B.B.A .LL.B,CNLU,PATNA

Academic session-2018-2023

CHANAKYA NATIONAL LAW UNIERSITY

Nyaya Nagar ,Mithapur,Patna 80001

INTRODUCTION

Share capital denotes the amount of capital raised by the issue of shares, by a
company. It is collected through the issue of shares and remains with the company
till its liquidation.

Share capital is owned capital of the company, since it is the money of the
shareholder and these shareholder are the owners of the company. The total share
capital is divided into small parts and each part is called a share. Share is the
smallest part of the total capital of a company. The amount of share capital a
company reports on its balance sheet only accounts for the initial amount for which
the original shareholders purchased the shares from the issuing company. Anyprice
differences arising from price appreciation/depreciation as a result of transactions
in these secondary market are not included.

For example, suppose ABC Inc. raised $2 billion from its initial public offering.
Over the next year,the total value of its shares increases to $5 billion. In this case,
the value of the share capital is still only $2 billion because ABC Inc. had received
only $2 billion from the sale of its securities to the investing public.

RESEARCH QUESTIONS

1) What are the types of share?

2) Process of allotment in terms of contract Act?
3) What are the legal provision of shares in he companes act 1956?

HYPOTHESIS

Share capital is owned capital of the company, since it is the money of the
shareholder and the shareholder are the owners of the company.

CHAPTERISATION

1) INTRODUCTION
1.1) Features of Share Capital
1.2) Types of Share Capital
2) KINDS OF SHARES
2.1) Deferred Shares
 2.2) Preference Shares

2.3) Equity or ordinary shares ; a) With voting rights b) Differential rights

3) Distinction between the Preference shares and equity shares.

4) MEANING OF UNDERWRITING

5) SECTIONS OF THE COMPANIES ACT 1956

5.1) SECTION 77
Case law; Bisakha Sales Pvt Ltd, Kolkata vs Assessee

5.2) SECTION 79

5.3) SECTION 113

5.4) SECTION 114

5.5) SECTION 81
Case law; Sree Ayannar spinning and waiving mills limited Vs.V.V.V Rajendran

Nanalal Zaver v. Bombay Life Assurance Co. Ltd

6) CONCLUSION

RESEARCH METHODOLOGY

Mostly doctrine sources and primary method of research was adopted in the
making of this project.

Few primary and secondary methods were used. Some literary works and books
and articles were referred and the interent through various websites were use
extensively for the collection of data which was required for the study needed for
this research.

BIBILOGRAPHY

The following sources were consulted by the researcher to complete this rough
proposal;

WEBSITES;
 https://www.jstor.org/stable/27878558
 https://www.lawteacher.net/free-law-essays/business-law/securities-and-
exchange-board-of-india-business-law-essay.php
 http://shodhganga.inflibnet.ac.in/bitstream/10603/67315/11/11_summary%2
0and%20conclusions.pdf
BOOKS;
1) LexisGreen Smart Pack: Law Books and Bare Acts
2) Accountancy part 2; TS Grewal