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Provided that such class or classes of holding companies as may be prescribed shall not have layers of subsidiaries beyond such numbers as may be prescribed Explain me this topic
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For certain companies, there can be a prescription that they cannot have more than say 2 layers of subsidiaries. Example A ltd. holds 51% shares in B ltd. B ltd. holds 51% shares in C ltd., C ltd. holds 51% share in D ltd., these are 3 layers of subsidiaries
Sahibdeep Singh
For certain companies, there can be a prescription that they cannot have more than say 2 layers of subsidiaries. Example A ltd. holds 51% shares in B ltd. B ltd. holds 51% shares in C ltd., C ltd. holds 51% share in D ltd., these are 3 layers of subsidiaries
So D ltd shall be deemed subsidiary comapny only of c Ltd not A Ltd
Thread Starter
Rakesh ShahSo D ltd shall be deemed subsidiary comapny only of c Ltd not A Ltd
No, that's not allowed. If company contravenes, it will have to pay fine. Rules say company and every officer of the company who is in default shall be punishable with fine which may extend to ten thousand rupees and where the contravention is a continuing one, with a further fine which may extend to one thousand rupees for every day after the first during which such contravention continues.
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