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CSEET · Business Laws and Management · Elements of Company Law

Twelve farmers, each a producer, wish to form a Producer Company under the Companies Act, 2013. Which statement is correct?

The Registrar must register the memorandum and articles and issue the certificate within thirty days of receiving the documents, if satisfied that requirements are met. Ten or more producers suffice, liability is limited by shares, and it can never be deemed a public company.

  1. AThe company may become a public limited company once it has more than 200 members
  2. BThe Registrar must register within thirty days of receipt of the documents if satisfied that requirements are complied withCorrect
  3. CMembers' liability is unlimited
  4. DAt least twenty individuals are required

Explanation

Section 378C allows ten or more producer individuals to form it. The Registrar registers within thirty days if satisfied. Liability is limited to the unpaid amount on shares, and it can never become a public company.

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