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Membership under Companies Act 2013.

Courtesy/By: Sarah Wilson | 2021-03-20 14:08     Views : 45

subscribers to MOA of the Co, every person who agrees in writing to become a member of the Co & whose name is entered in the register of members, every person holding shares of the Co &whose name is entered as a beneficial owner in the records of the depository. Thus a person can become a member of the Co either as the subscriber to the MOA or by subscribing to its shares, transfer of shares from an existing member, acquisition or purchase of shares, acquisition by devolution.

(1)By Subscribing to the MOA: subscribers of the MOA are deemed to have agreed to become members of the company by signing the MOA. They become members the moment the Co is registered & it's not necessary that their names are entered in the register of members-U.P Oil Mills v. Jamna.

(2)By Agreement & Registration-every person who agrees in writing to become a member & whose name is entered in the register of members shall be a member of the Co.

  • Heredia Unimers Ltd v. Renu Jain-the moment the shares are allotted & share certificate signed & name entered in the register of members, the allottee becomes the shareholder irrespective of the allottee receiving the shares or not.
  • Except in the case of subscribers to the MOA, 2 conditions are to be satisfied to become a member of a Co-
  • there is an agreement in writing to become a member
  • the name is entered in the register of members of the company.
  • Balakrishnan Gupta v. Swadeshi, lalithamba Bai v. Harrisons Malayalam Ltd. –the two conditions are cumulative. both conditions have to be satisfied to enable him to exercise the rights of a member.
  • However, for claiming relief under S 241(Oppression & mismanagement), it was held that the requirement of application in writing was not an essential condition to file a petition for relief. 
  • Registration of the name of a person as a member of a Co may arise-upon application & allotment, by transfer, by transmission, by estoppel/holding out.

(3)By agreeing to purchase qualification shares –directors when they sign & deliver to the Registrar a written undertaking to pay for qualification shares, they become a member automatically on the incorporation of the Co.

legal heirs of a deceased shareholder can be regarded as members for the purpose of filing a petition for prevention of oppression & mismanagement- Mrs. Margaret T. Desor v. World Wide Agencies (P)Ltd.-even if the name of the legal heir has not been placed on the register of members he can maintain a petition.

 

This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.

Courtesy/By: Sarah Wilson | 2021-03-20 14:08

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