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CS Executive · Company Law and Practice · Annual Report - Concepts

Kaveri Textiles Ltd is a Government company in which only the Government of a State holds shares; the Central Government is not a member. Who is responsible for the annual report on its working and affairs?

The State Government is responsible. Where the Central Government is not a member, the State Government must cause the annual report to be prepared within the time specified in section 394(1) and laid before the House or both Houses of the State Legislature with the audit report and CAG comments.

  1. AThe Central Government, under section 461
  2. BThe State Government, which must prepare it within the time in section 394(1) and lay it before the State LegislatureCorrect
  3. CThe Registrar of Companies, which prepares it for the State Legislature
  4. DThe CAG, which prepares and lays it before Parliament

Explanation

Section 395(1) applies where the Central Government is not a member. The State Government must cause the report to be prepared within the time in section 394(1) and laid before the State Legislature with the audit report and CAG comments. Section 461 concerns the general annual report on administration of the Act, not individual companies.

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