CA Intermediate · Corporate and Other Laws · Incorporation of Company and Matters Incidental Thereto

Vikram Textiles Private Limited has been incorporated. Later, the Registrar finds that the company was registered on the basis of a declaration of compliance that contained false information about the registered office address. Which statement reflects the correct legal position under the Companies Act, 2013 about the effect on the company's existence?

The company continues to exist because the certificate of incorporation is conclusive evidence of due registration. The false declaration does not make the incorporation void automatically. It can, however, expose the persons responsible to penal consequences or action for fraud, rather than undoing the company's legal existence.

1. AThe certificate of incorporation is conclusive evidence of valid incorporation, so the company continues to exist, though the persons responsible may be liable for the false declarationCorrect
2. BThe incorporation is void from the beginning and the company is deemed never to have existed
3. CThe company automatically stands dissolved on discovery of the false declaration
4. DThe company continues but all contracts it made become voidable at the option of the other party