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CA Intermediate · Corporate and Other Laws · Companies Incorporated Outside India

Zenith Optics Inc., a company incorporated in Singapore, has set up a liaison office in Pune and also purchases a place of business in Chennai from where it sells its products in India. Under Chapter XXII of the Companies Act, 2013, which description best fits the Chennai establishment?

Zenith Optics is a foreign company. A company incorporated outside India that has a place of business in India, itself or through an agent, and conducts business activity there is a foreign company. Incorporation abroad means it cannot be an Indian company.

  1. AIt is a foreign company because it has a place of business in IndiaCorrect
  2. BIt is an Indian company because it carries on business in India
  3. CIt is a company limited by guarantee registered in India
  4. DIt is a private company deemed incorporated in India

Explanation

A foreign company is one incorporated outside India that has a place of business in India, whether by itself or through an agent, physically or electronically, and conducts business activity in India. Zenith satisfies this. It is not an Indian company because incorporation took place in Singapore, not under Indian law.

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