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

Zephyr Aerotech Inc., a company incorporated in Delaware, USA, sets up a liaison office in Pune and has a place of business there from which it carries on business in India. Under the Companies Act, 2013, how is this company classified?

Zephyr Aerotech Inc. is a foreign company. The Companies Act, 2013 defines a foreign company as one incorporated outside India that has a place of business in India, itself or through an agent, and carries on business activity there. Both conditions are met by the Pune office.

  1. AForeign companyCorrect
  2. BIndian private company
  3. CGovernment company
  4. DAssociate company of an Indian company

Explanation

A foreign company means a company 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. Zephyr satisfies both conditions. It is not incorporated in India, so it cannot be an Indian private company or a government company.

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