Question

A private company can adopt Table 'A' in place of its Articles.

• A. True
• B. False

Answer 1

The correct option is B False

(i) A company is a private company, which by its articles

(a) limits the maximum membership to 50, excluding present and past employees.

(b) prohibits public (subscription) investment to its shares and debentures.

(c) restricts the transfer of its shares.

(ii) The Articles of Association is a document regulating the right of members of the company among themselves and the manner in which the business of the company shall be conducted

(iii) Table 'A' is a model set of articles given by the Companies Act, 1956 in its schedule I.I. contains in all 99 articles.

(iv) Normally, all private companies prepare their own articles and file the same with the Registrant

(v) If a private company has prepared its own articles, there is no need for it to adopt Table 'A'.

(vi) Generally, all these (99) articles are applicable to a public company.

(vii) That is why, a public company may adopt Table 'A' fully or partially and in addition ma adopt its own articles.

(viii) In case, no Articles of Association is filed at the time of incorporation by a public company limited by shares, Table 'A' automatically becomes applicable to such a company.

(ix) Hence, a private company does not adopt Table `A' as it prepares its own Articles.