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CS Executive · Company Law and Practice · Members and Shareholders

Veda Textiles Ltd, a company with members in several cities, maintains a register of members showing each member's holding. An inspector finds that the company has no index of the names entered in the register of members. Under the Companies Act, 2013, what is the legal position?

Every register kept under section 88(1), including the register of members, must include an index of the names in it. Failing to maintain it properly attracts a penalty on the company and on each officer in default. No exemption exists for small companies or electronic records.

  1. AAn index is optional if the register is maintained in electronic form
  2. BAn index is required only where the company has more than 200 members
  3. CEvery register under section 88(1) must include an index of the names in it, and failure attracts a penaltyCorrect
  4. DAn index is required only for the register of debenture-holders, not for members

Explanation

Section 88(2) says every register maintained under section 88(1) shall include an index of the names included therein. Under section 88(5), failure to maintain the registers in accordance with sub-section (2) attracts a penalty on the company and on every officer in default. The member-count and electronic-form conditions in the other options do not appear in the Act.

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