Which are the contracts entered into by promoters on behalf of a prospectus company?

Provisional contracts

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Pre-incorporation contracts

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Preliminary contracts

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Both a and b

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Solution

The correct option is C Both a and b
Promoter is obligated to bring the company in the legal existence and to ensure its successful running,; and in order to accomplish his obligation he may enter into some contract on behalf of prospective company. These types of contract are called pre-incorporation Contract' as well as provisional contracts.

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A provisional contract is signed by promoters before the incorporation of the company.

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