Company Law

MCQ
LLB II AND BSL IV

1 Question: _________ Order to call a EGM even though 1 member present in

person or by proxy.
(a) ROC
(b) C.G
(c) NCLT
(d) D.C.A
Ans. (b)
2 Question: The time period for conduction of AGM is extended by ROC for how
many months
(a) 1
(b) 2
(c) 3
(d) 4
Ans. (c)
3 Question: Maximum rate of discount that can be allowed on issue of shares
(a) 5%
(b) 10%
(c) 15%
(d) 20%
Ans. (b)
4 Question: Liability under_____ sec. may be imposed only if it is proved that the
companies business has been carried on with a view to defraud the creditors
(a) 540
(b) 541
(c) 542
(d) 543
Ans. (c)
5 Question: The time gap between two AGM’s shall not exceed.
(a) 15 months
(b) 18 months
(c) 16 months
(d) None of these
Ans. (a)
6 Question: Age limit of Directors in case of private company is ___________
(a) 65
(b) 70
(c) 75
(d) No limit
Ans. (d)
7 Question: Debentures payable to a holder of certificate is called_____
(a) Bearer
(b) Unregistered
(c) Secured
(d) Both ((a) & ((b)
Ans. (a)
8 Question: Minimum paid up share capital in case of a public company is _____
(a) 1 Lakh
(b) 3 Lakhs
(c) 5 Lakhs
(d) 7 Lakhs
Ans. (c)
9 Question: The company must deliver share certificate within______ if the shares
applied for transfer.
(a) 3 months
(b) 2 months
(c) 5 months
(d) none of these
Ans. (b)
10 Question: The lending of funds ultra vires, the company has no rights
(a) under the company’s Act
(b) contract Act
(c) under equity
(d) None of the above
Ans. (a)
11 Question: If the company failed to comply with the order of NCLT they will be
punishable with fine and
imprisonment up to
(a) 2 years
(b) 3 years
(c) 4 Years
(d) None of these
Ans. (b)
12 Question: Share warrants can be issued with the prior approval of the____
(a) Company law board
(b) Dept of company affairs
(c) Registrar
(d) None
Ans. (c)
13 Question: Minimum no. of Directors in case of a public company is ___
(a) 1
(b) 2
(c) 3
(d) 4
Ans. (c)
14 Question: Which of the following is not a member of a company?
(a) Partnership firm
(b) Foreigner
(c) Government
(d) HUF
Ans. (a)
15 Question: Debentures payable to person whose name appears both on
Debenture Certificate and company’s register is called
(a) Bearer
(b) Unregistered
(c) Registered
(d) None of the above
Ans. (c)
16 Question: ___ is issued in acknowledgement of any indebtedness
(a) Debenture certificate
(b) Share certificate
(c) Share warrant
(d) None of the above
Ans. (a)
17 Question: In case of Non -Profit making Companies notice of general meeting
should be given with in _____ days
(a) 14
(b) 15
(c) 21
(d) 22
Ans. (a)
18 Question: Change in objects clauses can be effected
(a) For any reason
(b) For special reason only
(c) to comply with C.G order
(d) None of the above
Ans. (b)
19 Question: Which of the following is a right of the members of a
company_____
(a) Right to have share
(b) Right Appoint Auditor
(c) Right Appoint Director
(d) All the above
Ans. (d)
20 Question: Which of the following can issue the share warrant
(a) Public
(b) Private
(c) Both (a) & (b)
(d) None of the above
Ans. (a)
21 Question: In case of continuing default to convene the AGM fine is
Rs.___________ for every day.
(a) 250
(b) 300
(c) 350
(d) 400
Ans. (a)
22 Question: Transfer of shares in the case of public company is
(a) Prohibited
(b) Restricted
(c) Freely transferable
(d) None of these
Ans. (c)
23 Question: In the given below who are required to hold A.G.M___________
(a) Public company
(b) Private company
(c) Government company
(d) All the three
Ans. (a)
24 Question: U/s 274 (f) (g) directors are disqualified for how
many________ years.
(a) 1
(b) 3
(c) 5
(d) 7
Ans. (c)
25 Question: Where the registrar strikes off the register the name of a company as
a defunct one, the court has the power to order restoration of name with in:
(a) 5 years
(b) 7 years
(c) 10 years
(d) 20 years
Ans. (c)
26 Question: In case of default with regards to deposits intimation to NCLT
should be made with how many
days.
(a) 10
(b) 20
(c) 30
(d) 40
Ans. (c)
27 Question: A share warrant is transferable by ____________
(a) By Execution of transfer deed
(b) By delivery
(c) both (a) and (b)
(d) None of the above
Ans. (b)
28 Question: Every AGM must be held with ___ from the date of the Balance
Sheet.
(a) 4 months
(b) 6 months
(c) 9 months
(d) None of these
Ans. (c)
29 Question: After the expiry of how much time the company must think that the
permission was not granted
(a) 11 weeks
(b) 12 weeks
(c) 10 weeks
(d) None of these
Ans. (c)
30 Question: The resolution passed at AGM are__________
(a) Valid
(b) Void
(c) Voidable
(d) Void ab-initio
Ans. (a)
31 Question: Own funds are called
(a) Debenture capital
(b) Share capital
(c) Loan capital
(d) None of the above
Ans. (b)
32 Question: If a new company get registered with a name which resembles the
name of existing company then it should apply to whom?
(a) NCLT
(b) SEBI
(c) ROC
(d) None of the above
Ans. (a)
33 Question: In case of red-herring prospectus the refund is made with an interest
@_____
(a) 12
(b) 13
(c) 15
(d) 16
Ans. (c)
34 Question: If the guarantee Co. having no share capital the liability of
shareholders will be
(a) To the extent of guarantee
(b) Unpaid value of shares
(c) Unlimited
(d) None of the above
Ans. (a)
35 Question: First AGM must be held within_____________ from the
incorporation of the company
(a) 15 months
(b) 18 months
(c) 12 months
(d) None of these
Ans. (b)
36 Question: The doctrine of__________ does not apply to acts void ab initio.
(a) Ultra virus
(b) Intra virus
(c) constructive notice
(d) Indoor management
Ans. (d)
37 Question: Cumulative preference share holders have voting right if dividend
are in arrears for years
(a) 1
(b) 2
(c) 3
(d) 4
Ans. (b)
38 Question: In case of Partly Convertible Debentures non-convertible portion is
classified as_____
(a) Debt
(b) Equity
(c) Both (a) & (b)
(d) None of the above
Ans. (a)
39 Ques. Transmission is effected by
(a) Sale
(b) Death
(c) Insolvency
(d) Both (b) & (c)
Ans. (d)
40 Ques. Which of the following can be used for buy back of shares
(a) Free reserves
(b) Securities premium
(c) Proceeds of fresh issue of shares
(d) All of the above
Ans. (d)
41 Ques. Deposits should issued with in__________ weeks from the date of
receipt of money.
(a) 2
(b) 4
(c) 6
(d) 8
Ans. (d)
42 Ques. If minimum subscription is not received application money should be
refunded with in _____ days
(a) 20
(b) 25
(c) 30
(d) 10
Ans. (d)
43 Ques. Information memorandum + shelf prospectus together constitutes_____
(a) Memorandum
(b) Articles
(c) Prospectus
(d) None of the above
Ans. (c)
44 Ques. In the event of appointing a proxy joint holders shall sign the proxy form
(a) Singularly
(b) Jointly
(c) None of the above
(d) both (a) & (b)
Ans. (b)
45 Ques. Minimum number of members in case of private company is
(a) 1
(b) 2
(c) 3
(d) 4
Ans. (b)
46 Ques. Maximum no .of members in case of public company is
(a) 0
(b) unlimited
(c) 50
(d) 100
Ans. (b)
47Ques. The liability of members if company is limited by guarantee.
(a) Unpaid value of shares
(b) Guarantee amount
(c) Unlimited liability
(d) None of the above
Ans. (b)
48 Ques. Which one of the following has a right to claim compensation for any
loss due to mis-statement in prospectus
(a) Purchasing shares in Primary Market
(b) Secondary Market
(c) Subscribers to memo
(d) All the above
Ans. (a)
49 Ques. ______ years of imprisonment will be imposed in case of issue of
prospectus with untrue statements
(a) 1
(b) 2
(c) 3
(d) 4
Ans. (b)
50 Ques. The liability of members if company is limited by shares
(a) Unpaid value of shares
(b) Guarantee amount
(c) Unlimited liability
(d) None of the above
Ans. (a)
51 Ques. Forfeiture can be made only if it is authorized by ______
(a) AOA
(b) MOA
(c) ROC
(d) C.G
Ans. (b)
52 Ques. Name of the member is struck off from the register in case
of____________
(a) Issue of share certificate
(b) Share warrant
(c) Forfeiture
(d) None of the above
Ans. (b)
53 Ques. A company can become a members of another company if it is so
authorized by______
(a) MOA
(b) AOA
(c) Both (a) & (b)
(d) None of the above
Ans. (a)
54 Ques. Validity period of information memorandum is___________
(a) 1 year
(b) 2 years
(c) 3 years
(d) 4 years
Ans. (a)
55 Ques. 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
Ans. (b)
56 Ques. How many members should sign the MOA in case of private
company_____________
(a) 1
(b) 2
(c) 3
(d) 4
57 Ans. (b)
Ques. In case minimum subscription is not received and refund is delayed____ %
of interest to be paid by the company.
(a) 5
(b) 6
(c) 7
(d) 8
Ans. (b)
58 Ques. Paying back of capital is called
(a) Redemption
(b) Conversion
(c) Participation
(d) None
Ans. (a)
59 Ques. Proxies cannot vote on_________
(a) Show of hands
(b) Poll
(c) Both (a) & (b)
(d) None of the above
Ans. (a)
60 Ques. Minimum number of members in case of public company
(a) 1
(b) 2
(c) 5
(d) 7
Ans. (d)
61 Ques. Minimum no. of Directors in case of private company is __________
(a) 1
(b) 2
(c) 3
(d) 4
Ans. (b)
62 Ques. If the company failed to refund application money with in 130 days from
the date of issue of
prospectus on non-receipt of minimum subscription who will be personally liable.
(a) Company
(b) Directors
(c) Shareholders
(d) None of these
Ans. (b)
63 Ques. 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
Ans. (c)
64 Ques. _______ % of shares should be held by a company in another company
so as to become subsidiary
(a) more than 50
(b) more than 40
(c) more than 30
(d) more than 20
Ans. (a)
65 Ques. In case of Non -Profit making Companies books of accounts are required
to be preserved for _____ years
(a) 2
(b) 4
(c) 6
(d) 8
Ans. (b)
66 Ques. Accepting of deposits from public in case of private company is
(a) Prohibited
(b) Restricted
(c) Acceptable
(d) None of these
Ans. (a)
67 Ques. XYZ Co. is a holding of XZ Pvt. Company. XZ Co. issued deferred
shares. The issue is valid or void
(a) Valid
(b) Void
(c) Situation does not arise
Ans. (b)
68 Ques. Stamp duty on registration of the company is payable based
on____________ capital.
(a) Nominal
(b) Authorized
(c) Both (a) & (b)
(d) None
Ans. (c)
69 Ques. ____ are the shares issued by the company to it employees or directors
for consideration other than cash
(a) Bonus
(b) Sweat
(c) Right
(d) None of the above
Ans. (b)
70 Ques. ________ resolution should be passed by the company to offer shares to
outsiders
(a) Special resolution
(b) Ordinary resolution
(c) C.G
(d) None of the above
Ans. (a)
71 Ques. For reducing its share capital it should give notice to whom?
(a) Debtors
(b) Creditors
(c) Both (a) & (b)
(d) None of the above
Ans. (b
72 Ques. The doctrine of indoor management is an_________ to the doctrine of
constructive notice
(a) Exception
(b) Extension
(c) Alternative
(d) None of the above
Ans. (b)
73 Ques. Companies are now allotted a_________ in addition to their name
(a) PAN
(b) SIN
(c) PIN
(d) CIN
Ans. (d)
74 Ques. In how many days did the company have its registered office after
incorporation
(a) 10
(b) 20
(c) 30
(d) 40
Ans. (c)
75 Ques. In the MOA there are 6 clauses. We can alter all clauses expect one
clause. What is that clause?
(a) Objects clause
(b) Name clause
(c) Association clause
(d) None of these
Ans. (c)
76 Ques. If any body wants to file a case against the company they should file at
what place _____
(a) Company
(b) Registered Office
(c) BOD
(d) Books of accounts
Ans. (b)
77 Ques. Ultra vires loans granted by the company are
(a) Void
(b) Voidable
(c) Valid
(d) None of the above
Ans. (a)
78 Ques. conceives the idea of the business
(a) Promoters
(b) Directors
(c) Auditors
(d) None of the above
Ans. (a)
(79) 1. What are the limits of number of members in a Private Company?
(a) Fifty (b) Seven (c) Twenty (d) Two hundred
Answer: D
(80) 3. Which of the following is not a stage of the development of company?
(a) Promotion (b) ProductionD(c) Incorporation (d) Commencement of Business
Answer: B
(81) 4. 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
Answer: D
(82) 6. 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
Answer: A
(83) 7. The_____________ of a government company is appointed or reappointed
by the Comptroller and Auditor General of India.
(a) Auditor (b) Company Secretary (c) Both (a) and (b) (d) None of the above
Answer: A
(84) 8. 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
Answer: B
(85) 9. 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: A
(86) 10. A is one who performs the preliminary duties necessary to bring a
company into being and float it.
(a) Auditor (b) Promoter (c) Director I (d) Financer
Answer: B
(87) 11. The registered office clause of memorandum of association contains
(a) The name of the state in which the registered office of the company is to be
situated.
(b) The name of the city/town only and not that of the state.
(c) The name of registrar of companies
(d) The complete postal address.
Answer: A
(88) 12. “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
Answer: A
(89) 13. 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
Answer: D
(90). Which documents contains the constitution of a company?
(a) Memorandum of Association
(b) Articles of Association
(c) Both (a) and (b)
(d) None of these
Answer: A
(91) 16. Which documents contains the regulations relating to the internal
management of a company?
(a) Memorandum of Association
(b) Articles of Association
(c) Both (a) and (b)
(d) None
Answer: B
(92) 21. Company is managed by
(a) Shareholders (b) Board of Directors (c) Karta (d) Both(a)&(b)
Answer: . B

(93) 1. The most important document of a company is its __________.

A. prospectus.

B. annual report.

C. memorandum of association .

D. articles of association .

ANSWER: C

(94) 2. The rules and regulations for the internal management of a company are
contained in its_______.

A. prospectus .

B. annual report .

C. memorandum of association .

D. articles of association .

ANSWER: D
(95) 4. The union government may appoint such number of directors in a company
as it may deem necessary

A. at its own initiative .

B. on the application of least 100 members of the company .

C. on the application of members holding at least 10% voting rights.

D. any of the above .

ANSWER: D

(96) 5. A director’s election takes place in a general meeting through a separated

Resolution passed by a _______ majority.

A. single.

B. two-thirds.

C. three-fourths.

D. five-sixths .

ANSWER: A

(97) 6. Which of the following is beyond the powers of the board of directors?

A. To issue debentures.

B. To make loans.

C. To remit the payment of any debt due by a director.

D. to issue prospectus.

ANSWER: C

(98) 7. The minimum subscription is to be received within ______days of the offer.

A. 30.

B. 60.

C. 120.
D. 150.

ANSWER: C

(99) 9. A share certificate once issued by the company binds it in two ways,
namely by estoppel as to title and ___________.

A. by estoppel as to payment.

B. by estoppel as to profit.

C. by estoppel as to dividend.

D. none

ANSWER: A

(100) 10. Share capital of a company means __________.

A. equity share capital .

B. preference share capital

C. equity and preference share capital .

D. equity and preference share capital and debentures.

ANSWER: C

(101) 11. A shareholder in a company___________.

A. can be its debentureholder

B. cannot be its debentureholder

C. alone can become its debentureholder

D. must also become its debentureholder within a year of being a shareholder.

ANSWER: A
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