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CS Executive · Capital Market and Securities Laws · Buy-Back of Securities

Orchid Foods Pvt Ltd, an unlisted company, proposes a buy-back authorised by a special resolution. Which statement about its filings under the Companies Act, 2013 is correct?

An unlisted company must still file the declaration of solvency with the Registrar before the buy-back, but it is not required to file it with SEBI because its shares are not listed on a recognised stock exchange. The same exemption from SEBI filing applies to the post-buy-back return.

  1. AIt must file the declaration of solvency with SEBI as well as the Registrar
  2. BIt need not file the declaration of solvency with SEBI, but must file it with the RegistrarCorrect
  3. CIt need not file any declaration of solvency at all
  4. DIt must file the post-buy-back return with SEBI but not the Registrar

Explanation

Under section 68(6) a declaration of solvency is filed with the Registrar. The proviso says no declaration is filed with SEBI by a company whose shares are not listed. Likewise, the return under section 68(10) is not filed with SEBI by an unlisted company, though it goes to the Registrar.

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