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CS Executive · Company Law and Practice · Members and Shareholders

Kaveri Textiles Ltd, a company incorporated in Coimbatore, has equity shareholders and preference shareholders. Its Company Secretary maintains one register of members showing only each member's total shareholding without splitting by class. Under the Companies Act, 2013, which defect is most directly at issue?

The register of members must show separately, for each class of equity and preference shares, the holding of each member, whether resident in or outside India. A register giving only combined totals fails Section 88(1)(a), so the company is in default.

  1. AThe register must indicate separately for each class of equity and preference shares held by each memberCorrect
  2. BThe register must be maintained only in electronic form
  3. CThe register must show only members residing in India
  4. DThe register need not include any index of names

Explanation

Section 88(1)(a) requires the register of members to indicate separately for each class of equity and preference shares held by each member, whether residing in or outside India. A register showing only total holdings does not meet this. The other options misstate the section: residence outside India is covered, and an index is required.

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