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Business Environment and Law-Share & Share Capital

Share & Share Capital

   Posted On :  08.05.2018 08:49 am

Meaning of a Share. Section 2(46) defines a share “as a share in the share capital of a company and includes stock except where a distinction between stock and share is expressed or implied.

Share & Share Capital

Meaning of a Share. Section 2(46) defines a share “as a share in the share capital of a company and includes stock except where a distinction between stock and share is expressed or implied. A share signifies the following:

1. The interest of a shareholder in the company; the right to receive dividend, attend meetings, vote at the meeting and share in the surplus assets of the company, if any, in the event of the company, being wound up ;
2. The liability of the shareholder in the company to pay calls on shares until fully paid up;
3. The right of the shareholder to transfer the shares subject to the articles of association.
4. Binding covenants on the part of the company as well as the shareholder, as given in the Articles of the company.
 
Thus, a share of a company in the hands of a shareholder signifies a bundle of rights and obligations. A share is not a negotiable instrument.
 

 

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