Elements of Company Law - Chapter 7A

 Chapter 7A  
Elements of Company Law
MCQ

1. The term Company derived from the 

____________ words

a. English

b. French

c. Latin

d. Indian

2. Section __________ of the Companies Act, 1956 

defines the Company

a. 2

b. 3

c. 30

d. 31

3. Private company is defined in :

a. Section 3(1)(iii)

b. Section 2

c. Section 3(1)(ii)

d. None of the above

4. The main characteristics of a company are:

a. Corporate Personality

b. Common Seal

c. Perpetual Succession

d. All of the above

5. Salomon v. Salomon & Co. Ltd. 1897, AC 22 

established the principle of:

a. Corporate personality of company

b. Legality of company

c. Nationality of company

d. Meaning of company

6. Company will have fundamental rights:

a. True

b. False

c. Partly true

d. None of the above

7. An association for profit requires ______________ 

from the Central Government.

a. Registration 

b. Licence 

c. Certification 

d. None of the above

8. The features of a company do not include the 

following:

a. It has corporate personality

b. It can sue and be sued

c. It has nationality 

d. It is a citizen of the country

9. A company is a:

a. Legal person

b. Juristic person

c. Artificial person

d. Any of the above

10. Lifting the corporate veil means :

a. Ignoring the corporate personality

b. Promoting corporate personality

c. Deciding corporate personality

d. Modifying corporate personality

11. A company may be :

a. Limited by shares

b. Limited by guarantee

c. Unlimited

d. Any of the above

12. A private company is one whose minimum paid up 

capital is:

a. Rs 1,00,000

b. Rs 5,00,000

c. Rs 10,00,000

d. Rs 100,00,000

13. A Government company is one where:

a. The Central Government holds 50% shares.

b. The Central and State Government hold 50% 

shares.

c. The Central Government holds 51% shares.

d. The Central Government holds more than 50%

14. The following is not a statutory company:

a. Reserve Bank of India

b. Life Insurance Corporation of India

c. Tata Steel Ltd

d. State Bank of India

15. For incorporation of a private company:

a. Minimum 2 persons required

b. Minimum 3 persons required

c. Minimum 5 persons required

d. Minimum 7 persons required

16. Maximum number required for a public company is :

a. 5

b. 10

c. 50

d. None

17. For incorporation of a producer company :

a. Minimum 3 persons required

b. Minimum 5 persons required

c. Minimum 7 persons required

d. Minimum 10 persons required

18. Subsidiary company means a company when 

another company holds:

a. 51% shares in that company

b. More than half of the shares of that other 

company

c. Controls the Board of Directors of that other 

company

d. Both (b) and (c)

19. A company incorporated outside India having a 

place of business in India shall file documents with 

the Central Government within:

a. 21 days

b. 30 days

c. 45 days

d. 90 days

20. State where the registered office is situated is given 

in:

a. MOA

b. AOA

c. Prospectus

d. Any of the above

21. MOA to be signed by the:

a. Subscribers

b. Directors

c. Promotors

d. All of the above

22. MOA should be in form _____________ in 

case of company limited by shares

a. Table A

b. Table B

c. Table C

d. Table D

23. MOA should be in form ___________ in 

case of company limited by guarantee not having 

share capital.

a. Table A

b. Table B

c. Table C

d. Table D

24. MOA should be in form _________ in case 

of company limited by guarantee and having share 

capital.

a. Table A

b. Table B

c. Table C

d. Table D

25. MOA should be in form ___________ in case of a 

unlimited liability

a. Table A

b. Table B

c. Table E

d. None of these

26. E-Form 18 relates to :

a. Incorporation of company

b. Intimation of particulars of Directors

c. Intimation of registered office

d. Filing of miscellaneous documents

27. For incorporation of a company declaration is to be 

given by:

a. Power of Attorney Holder

b. Practising Company Secretary

c. Advocate of Supreme Court

d. (b) or (c)

28. Conclusiveness of Certificate of Incorporation is 

provided in Section:

a. 3

b. 17

c. 31

d. 35

29. The memorandum of association of the company 

contains:

a. The rules regarding the company

b. Charter of the company

c. Procedure of the management of the company

d. None of the above

30. .... Resolution is required to alter MOA.

a. Special

b. Ordinary

c. Two-third majority

d. None of the above

31. The object clause of a company can be changed by 

passing resolution:

a. By the Board of Director

b. By shareholders

c. By creditors

d. None of the above

32. Doctrine of ultra vires means :

a. Against the company

b. Outside the objects of the company

c. Illegal business

d. Wrong objects of the company

33. The articles of association of the company contains:

a. The rules regarding the company

b. Charter of the company

c. Procedure for internal management of the 

company

d. None of the above

34. Articles is defined in :

a. Section 2(1)

b. Section 2(2)

c. Section 2(3)

d. Section 2(12)

35. Which one of the following is the relation between 

the doctrine of constructive notice and indoor 

management:

a. Constructive notice is contemporary to indoor 

management.

b. Constructive notice is opposite to indoor 

management.

c. Constructive notice and indoor management 

runs at par.

d. Constructive notice and indoor management are 

parallel.

36. Application for registration of a company shall be 

made by filing:

a. E-Form 1

b. E-Form 2

c. E-Form 18

d. E-Form 32

37. A company in India is guided by the:

a. Constitution of India

b. Companies Act, 1956

c. SEBI Act, 1992

d. Stock Exchange Regulations

38. _________ conceives the idea of the business.

a. Promoters

b. Directors

c. Auditors

d. None of the above

39. _________ persons required for formation of a 

public company.

a. 7

b. 15

c. 21

d. None of the above

40. A private company can start business after 

obtaining 

a. Certificate of Incorporation

b. Certificate of Commencement

c. Licence from the Central Government

d. All of the above

41. Property of the company belongs to :

a. Company

b. Shareholders

c. Members

d. Promoters

42. Which company shares can be freely transferable:

a. Private Company

b. Public Company

c. Both (a) & (b)

d. None of the above

43. Minimum number of members in case of public 

company should be:

a. 1

b. 2

c. 5

d. 7

44. Minimum number of members in case of private 

company is:

a. 1

b. 2

c. 3

d. 5

45. Maximum numberof members in case of private 

company is:

a. 50

b. 100

c. 150

d. 200

46. Liability of a member in case of a private company 

is:

a. Limited

b. Unlimited

c. Both (a) or (b)

d. None of the above

47. XYZ private company had reduced to a single 

member and continued business more than 6 

months. The company's liability will be:

a. Limited

b. Unlimited

c. Restricted

d. None of the above

48. Generally rights and obligations of the company are 

regulated in:

a. AOA

b. MOA

c. Prospectus

d. None of these

49. Which companies are exempted to add “Ltd.” or 

“Pvt. Ltd.” at the end of their name?

a. Private

b. Government

c. Defunct

d. Association not for profits

50. The companies which are formed under special 

charter granted by the king or queen of England are 

called:

a. Statutory companies

b. Registered companies

c. Chartered companies

d. None of these.

51. The companies which are formed under special Act, 

are called as:

a. Chartered companies

b. Statutory companies

c. Registered companies

d. None of these

52. The companies formed under Companies Act, 1956 

are called as:

a. Chartered companies

b. Statutory companies

c. Registered companies

d. None of these

53. While calculating maximum limit in case of private 

company which of the following will not be included:

a. Employee + Member

b. Member + Employee

c. Member

d. None of these

54. Z Pvt. Ltd. is subsidiary of X Ltd. which is a public 

Company? Z Pvt. Ltd. is a :

a. Private Co.

b. PublicCo.

c. Government Co.

d. None of these

55. ________ is the conclusive evidence in case of 

company that statutory requirements have complied 

with.

a. Certificate of Incorporation

b. Certificate of commencement of Business

c. Both (a) and (b)

d. None of the above

56. Public company Should start business after getting 

certificate of:

a. Incorporation

b. Commencement of business

c. Both (a) and (b)

d. None of the above

57. Companies are allotted a _________ by the MCA 

on registration

a. PAN

b. SIN

c. PIN

d. CIN

ANSWERS

1 C 31 B

2 B 32 B

3 A 33 A

4 D 34 B

5 A 35 B

6 A 36 A

7 B 37 B

8 D 38 A

9 D 39 A

10 A 40 A

11 D 41 A

12 A 42 B

13 C 43 D

14 C 44 B

15 A 45 A

16 D 46 C

17 D 47 B

18 A 48 B

19 C 49 D

20 A 50 C

21 A 51 B

22 B 52 C

23 C 53 B

24 D 54 B

25 C 55 A

26 D 56 B

27 D 57 D

28 D

29 B

30 A

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