MATTERS INCIDENTAL THERETO

(PART-C)
- BY CS HIMANSHI
DHAKAD
What we will discuss in this lesson :
• Companies with charitable object (Sec.8 Co).
• Provision related to formation of Sec.8 Co.
• Questions
 COMPANIES WITH CHARITABLE
OBJECT (SEC.8 CO. / LICENCE CO.)

Co.’s object is promotion of commerce, art, science,

sports, education, research or any such object.

Prohibition on Apply its profits only

payment of dividend in promoting its
to its members. objects.
 PROVISIONS RELATED TO
FORMATION OF SEC.8 CO.

Sec.8 Co. formed CG has power to Partnership firm

to promote issue license to may be a member
charitable Sec.8 Co. with of Sec.8 Co.
objects, apply its limited liability
profit to its without adding
objects only & ‘limited’ or ‘private
not pay dividend limited’ to its
to its members. name.
It shall not alter It can convert It is in the
its MOA & AOA itself in any other nature of
except with the form by passing Limited
previous Special Company.
approval of Resolution in
Central general meeting.
Government.
CG can order revocation of
License where:
- Contravenes conditions
- Fraudulent conduct
- Prejudicial to public interest
But before revocation
opportunity of being heard is
given.
On revocation, ROC put ‘Pvt.
Ltd.’ or ‘Ltd.’ in its name in
registers
On revocation, CG may direct :
- Converts Its status & change its
name.
- Wind – up
- Amalgamate with another co. having
similar object
Exceptions :
- Call its GM by giving clear 14 days
notice
- Requirement of min. director not
apply
- Need not constitute Nomination &
remuneration Committee &
shareholders relationship committee.
 QUESTIONS ?
Q.1 Alpha ltd., a Sec.8 Co. calls its general meeting by giving notice of
clear 20 days. Is it valid ?
Ans. Yes, it is valid. It can call its general meeting by giving at least 14
clear days notice instead of 21 clear days notice.
Q.2 On revocation of license, Can a Sec.8 Co. be amalgamated with a
manufacturing Co. ?
Ans. No, it can amalgamated only with any other co. registered u/s 8 &
having similar objects.