Question

Company can be called government company if _________% of paid up share capital is held by government company.

• A. more than 30
• B. more than 40
• C. more than 50
• D. none

Answer 1

The correct option is C more than 50

A “Government company” is defined under Section 2(45) of the Companies Act, 2013 as “any company in which not less than 51% of the paid-up share capital is held by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments, and includes a company which is a subsidiary company of such a Government company”. Thus, the cardinal feature of a government company is not less than 51% ownership by Central/state government, either individually or jointly.