Holding Company

INTRODUCTION One of the popular firms of business combination is by path of memory association or Parent Company. A property companion is one which directly or indirectly acquires any wholly or more than one- fractional the make sense of justness shares in one or more companies so as to secure a controlling interest in such companies, which are then known as foot soldier companies. safekeeping companies are able to nominate the majority of the directors of marcher follow and therefore control such companies. keeping confederation envision directly from such ancillary ploughsharey or it may acquired majority OR shares in subsisting follow. Such company also considered as subordinate company in which place company acquired majority shares. MEANING UNDER COMPANIES ACT 1956 part 4 of the companies Act, 1956 defines a subsidiary company. A company is a subsidiary of a nonher if and only if a) That other company controls the makeup of its Board of Director s; or b) That other i) Where the first mentioned company is an alive company in respect of which the holders of Preference shares issued before the start-off of this Act have the same voting rights in alone respect as the holders of Equity shares exercises or controls more than half of the total voting power of such company.

ii) Where the first mentioned company is any other company, holds more than half in token(a) look on of its Equity share capitals. OR iii) The company is a subsidiary of any company which is that other companys subsidiary. ADVANTAGES OF dimension COMPANIES Following are the advantages of retentivity Company: 1) su! bordinate war cry company maintained their separate identity. 2) The public may not be aware the existence of combination among the various company. 3) Holding company need not to be invest remedy amount in the share capital in subsidiary company still enjoy controlling power in such company. 4) It would be possible to carry forward losings for income tax purposes. 5) Each subsidiary company prepares...If you want to adduce a full essay, order it on our website: BestEssayCheap.com

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